ASTS Stock Before Q3 Earnings: A Smart Buy or Risky Investment?

AST SpaceMobile ASTS is scheduled to report third-quarter 2025 earnings on Nov 10, 2025, after market closes. The Zacks Consensus Estimate for revenues and earnings is pegged at $20.74 million and a loss of 18 cents per share, respectively. Over the past 60 days, the earnings estimate for ASTS for fiscal 2025 has remained unchanged, and for fiscal 2026, it has increased by 2.86%.

Earnings Surprise History

The company delivered a negative four-quarter earnings surprise of 38.12%, on average. In the last reported quarter, the company delivered a negative earnings surprise of 115.79%.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for ASTS this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the chances of an earnings beat. This is not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

ASTS currently has an ESP of -28.57% with a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.

Factors Shaping the Upcoming Results

During the quarter, ASTS inked a deal to acquire global S-Band spectrum priority rights for $64.5 million. The acquisition will give ASTS S-band ITU priority rights to mobile satellite services frequencies in the range of 1980-2010 MHz and 2170-2200 MHz. Along with the L-Band spectrum strategy in the United States and Canada, the addition of S-band will significantly enhance ASTS’ network coverage worldwide, boosting its subscriber capacity. 

ASTS aims to deliver robust connectivity from space to every smartphone with a peak data transmission speed of upto 120 Mbps. Hence, the company is also steadily increasing its mobile network operator partner base along with spectrum acquisition. These factors are expected to have a favorable impact in the upcoming results.

However, unfavorable macroeconomic conditions, such as rising inflation, higher interest rates, volatility in the capital markets, imposition of tariffs and geopolitical conflicts, often negatively impact AST SpaceMobile’s operations. Fluctuations in satellite material prices due to these factors increase capital costs and affect its financial condition. Forex volatility remains a concern.

Price Performance

Over the past year, ASTS has gained 212.5% compared to the industry’s growth of 40.4%. However, it has outperformed its peers like  Iridium Communications, Inc. IRDM but underperformed Viasat, Inc. VSAT over this period. Viasat has increased 268.9%, while Iridium has declined 40.7% during this period.

Key Valuation Metric of ASTS

From a valuation standpoint, ASTS is currently trading at a premium compared to the industry. Going by the price/sales ratio, the company’s shares currently trade at 109.86 forward sales, higher than 4.47 for the industry.

Investment Considerations

ASTS deployed its initial set of five commercial satellites in low earth orbit. Named Bluebird, these satellites feature over 5,600 cells within the premium low-band spectrum. In the second half of 2025, it is also set to launch its next generation of commercial “Block 2 BlueBird (BB) satellites,” featuring communication arrays of up to 2,400 square feet. This will be a major step forward in establishing a robust space-based broadband connectivity system.

It is benefiting from a growing client base in the public and private sectors backed by its robust satellite connectivity portfolio. Acquisition of S-Band spectrum priority rights and access to 45 MHz of L-Band, premium lower mid-band spectrum, in the United States and Canada has significantly boosted its subscriber capacity globally. Moreover, expanding collaboration with major telecom operators worldwide, such as AT&T, Verizon, Vodafone Idea and Rakuten, has boosted commercial prospects.

However, the company faces stiff competition from existing and new industry leaders like SpaceX’s Starlink, Iridium and Viasat, which are developing satellite communications technology. Iridium has been making solid investments to boost its technology infrastructure. It aims to launch satellite services for Direct-to-Device and satellite-based personal communication devices. Viasat is ramping up investments in the development of its revolutionary ViaSat-3 broadband communications platform. VSAT is also expanding its partner base in emerging markets worldwide to boost prospects in the space-based connectivity domain. This can pose a major challenge to ASTS.

Moreover, to build its competitive edge in the industry, ASTS has to invest continuously in innovation, infrastructure improvement and portfolio expansion. These factors are driving up the operating costs and straining margins. 

The company is working with leading-edge direct-to-smartphone satellite communication technology. Investors are betting big on the future potential of this technology. However, it is to be noted that ASTS' valuation significantly exceeds that of satellite peers competing in the same space. Owing to the stock’s premium valuation, we believe investors should remain cautious as macroeconomic factors, or economic downturns, can significantly impact overvalued stocks like ASTS.

End Note

A comprehensive patent portfolio, strategic collaboration with major telecom operators and strong focus on satcom infrastructure expansion are expected to drive growth. The strategy of expanding subscriber capacity with spectrum acquisition will likely bring long-term benefits.

However, the operating costs associated with the development of sophisticated satellite technology will continue to strain the margin in the near term. Stiff competition, premium valuation amid macroeconomic headwinds and fluctuating satellite material prices are major concerns.

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This article originally published on Zacks Investment Research (zacks.com).

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