Amazon shows off new satellite internet antennas as it takes on SpaceX’s Starlink
The tech giant said the “standard” version of the satellite antenna, also known as a customer terminal, is expected to cost Amazon less than $400 each to produce.
“Every technology and business decision we’ve had has centered on what will deliver the best experience for different customers around the world, and our range of customer terminals reflect those choices,” Rajeev Badyal, Amazon vice president of technology for Project Kuiper, said in a statement.
Project Kuiper is Amazon’s plan to build a network of 3,236 satellites in low Earth orbit, to provide high-speed internet to anywhere in the world. The Federal Communications Commission in 2020 authorized Amazon’s system, in which the company has said it will “invest more than $10 billion” to build.
The Kuiper antennas
The “ultra-compact” version of the Project Kuiper
The “standard” design measures under 11 inches square and 1 inch thick, and weighs under 5 pounds. Amazon says the device will deliver speeds to customers of “up to 400 megabits per second (Mbps).”
An “ultra-compact” model, which Amazon says is its smallest and most affordable, is a 7-inch square design that weighs about 1 pound and will offer speeds up to 100 Mbps. In additional to residential customers, Amazon plans to offer the antenna to government and enterprise customers for services like “ground mobility and internet of things.”
Amazon Senior Vice President of Devices and Services Dave Limp declined to say how much it costs to make each ultra-compact antenna, but told CNBC that it is “materially less” expensive to make than the standard model.
Its largest “pro” model, at 19 inches by 30 inches, represents a high-bandwidth version for more demanding customers. Amazon says this antenna will be able to “deliver speeds up to 1 gigabit per second (Gbps)” via space. Badyal told CNBC there are a variety of enterprise and government applications for the pro series, such as “oil rigs in the middle of the ocean” or “ships that want lots of bandwidth,” such as military vessels.
The company’s “Pro” customer terminal, the largest of the trio of Project Kuiper satellite antennas at 19 inches by 30 inches.
Amazon has yet to say what it expects the monthly service cost for Project Kuiper customers will be.
In showing early customers its antennas, Limp said he’s seen them get “excited” about the lineup.
“They’re surprised by the price points, surprised at the performance for the size, and [the antennas] are solid state so there’s no motors,” Limp told CNBC.
Amazon said it expects to begin mass-producing commercial satellites by the end of this year. Limp told CNBC that once Amazon’s manufacturing facility is fully built, the company expects to manufacture up to “three to five satellites per day at scale.”
“We’ll ramp up to that volume,” Limp said.
Amazon’s demand for rocket launches
The company’s first two prototype satellites are scheduled to launch on the debut mission of United Launch Alliance’s Vulcan rocket, set for May.
Badyal told CNBC that Amazon expects to make “minor tweaks” from the prototypes to the commercial version, as the satellites are “almost identical” but represent the first time much of the company’s hardware has flown in space.
The company’s prototype Project Kuiper satellites shipping for launch.
While Amazon has yet to show off its satellites, or reveal many details, Limp noted that the Kuiper spacecraft are “larger mass” than the first generation of SpaceX’s Starlink satellites, with Amazon aiming for “Goldilocks-sizing.” And Amazon expects the performance of its Kuiper satellites to “outperform them significantly” when compared to Starlink, with expected performance of processing up to 1 terabit per second (Tbps) of traffic. The satellites are expected to have a lifespan in space of about seven years, before they need to be replaced.
Launches of production satellites are scheduled to begin in the first half of 2024, with initial service slated for once the company has a few hundred satellites in orbit, Limp noted.
Last year, Amazon announced the biggest corporate rocket deal in the industry’s history, and has booked 77 launches – deals that included options for more when needed – from a variety of companies to deploy the satellites fast enough to meet regulatory requirements.
Limp said that those launches mean Amazon has “enough to get the vast majority of the constellation up” in space.
“I don’t think you’re ever done thinking about launch capacity, but we feel pretty good about what we have on the order books,” Limp added. “If new vehicles come online, that are more competitive, we’re going to look at it.”
Notably, Amazon has not purchased launches from SpaceX, the most active U.S. rocket launcher. Instead, Amazon has tapped a variety of competitors, purchasing rides largely on rockets that have yet to debut.
“I don’t have any religious issue not to buy capacity from SpaceX, they’re a very reliable rocket, but the Falcon 9 economically wasn’t the best rocket for us,” Limp explained.
Asked whether Amazon would consider owning a rocket system to support its launches, Limp said, “I would never say never to a question like that” but that the company looks for acquisitions in areas “where you can have something that’s differentiated and it’s something where it’s not well-served.”
Limp noted that it’s a different scenario than something like “Prime Air,” the company’s cargo airline, as that was a situation in which the company’s forecast for e-commerce growth was higher than transportation providers like FedEx or UPS or USPS believed.
“We were just using a lot of the excess capacity … only then when it stopped becoming well served did we look at it,” Limp said. “There was a shift in it being well-served for our needs. Right now, I don’t see that from a rocket perspective. There is a lot of launch out there.”
GameStop stock soars after retailer posts first quarterly profit in two years
Shares of the company soared more than 45% during after-hours trading.
For the quarter ended Jan. 28, net sales dropped slightly to $2.23 billion from $2.25 billion in last year’s fourth quarter. The video game retailer also posted a profit of $48.2 million, or 16 cents a share, compared to a loss of $147.5 million, or 49 cents, a year ago.
GameStop did not provide financial guidance and has not done so since the early days of the pandemic. Its results can’t be compared with Wall Street estimates because too few analysts cover the company.
The retailer had been working to steer itself back to profitability, and got there in part by cutting costs. Selling, general and administrative expenses came in at $453.4 million for the quarter, or 20.4% of sales, compared to $538.9 million, or 23.9% of sales, in the year-earlier period.
Scott Olson | Getty Images
CEO Matt Furlong said on an investor call the company is going into 2023 with further plans to cut excess costs including in European markets, where it has already exited and begun to pull out of some countries. He said that GameStop is also considering bolstering its business with higher margin categories such as toys.
GameStop had previously been riding some short-term, meme-stock momentum, but that has since leveled out and the company has made progress in right-sizing its business by cleaning up its inventory levels and reworking its cost structure.
The stock closed trading on Tuesday at around $18 per share, down dramatically from its 52-week high of nearly $50 about a year ago.
GameStop’s turnaround plan was reinvigorated by a leadership shake-up in 2021 that put Furlong, an Amazon veteran, at the helm and added Ryan Cohen, Chewy founder and former Bed Bath & Beyond activist investor, as board chair. The company also laid off staff and replaced its chief financial officer.
The retailer has been working to revamp its real estate portfolio and increase its online business as the video game industry heads in that direction.
For the full fiscal year, GameStop saw $5.93 billion in sales, down slightly from $6.01 billion in fiscal 2021, and saw increased revenues from its collectibles category, which the retailer is banking will promote long-term growth.
Like many retailers, GameStop experienced supply chain delays that left it with a backlog of inventory after it previously tried to meet high demand. The company is still hanging on to $682.9 million in inventory, which is down from $915 million a year ago, according to its fourth-quarter balance sheet.
As part of its revival strategy, GameStop also has been trying to improve its cash balance. This quarter, its cash and cash equivalents were $1.39 billion.
While managing the burdens of its brick-and-mortar presence, the company has also been working to find its digital identity. So far, those experiments have come with a few missteps.
In September, it launched an ill-fated partnership with the now-bankrupt crypto exchange FTX. The companies had planned to collaborate on e-commerce marketing and GameStop was going to sell FTX gift cards in its stores. Two months later, GameStop tweeted that it would be “winding down” the partnership and refunding anyone who had purchased an FTX gift card in its stores.
In addition, the company has been experimenting with an NFT marketplace since July. That launch came amid chatter of a “crypto winter” as cryptocurrencies experienced a widespread cooldown from their 2021 rallies. The marketplace saw an initial volume surge but has since leveled off and may not be the ticket to a stable digital presence the company had hoped it would be.
Still, Furlong said on a call with investors that compared to 2021, when many “predicted we were heading for bankruptcy,” the company is better positioned.
“GameStop is a much healthier business today than it was at the start of 2021,” he said.
Nike’s holiday quarter plagued by bloated inventory, weak China sales
Mike Segar | Reuters
Nike, like other retailers, has been in the process of offloading a glut of inventory brought on by supply chain disruptions and shifting consumer demands that’s been weighing on its margins.
Gross margins were down to 43.3% for the quarter, a decrease of 3.3 percentage points, due to higher markdowns and promotions its used to liquidate its inventory.
While Nike CEO John Donahoe told investors last quarter he believes the company is past its inventory peak, the company warned gross margins were expected to take a hit during the holiday quarter.
Inventories were up 16% compared with the year ago period at $8.9 billion, which the company attributed to higher product input costs and elevated freight expenses.
Here’s how the sneaker giant performed in its third fiscal quarter of 2023 compared with what Wall Street was anticipating, based on a survey of analysts by Refinitiv:
- Earnings per share: 79 cents vs. 55 cents expected
- Revenue: $12.39 billion vs. $11.47 billion expected
The company’s reported net income for the three-month period that ended Feb. 28 was $1.2 billion, or 79 cents per share, compared with $1.4 billion, or 87 cents per share, a year earlier.
Sales rose to $12.39 billion, up 14% from $10.87 billion a year earlier.
Nike has been looking to see a sales rebound in China, its third-biggest market by revenue, as the region recovers from the Covid pandemic. But those hopes failed to materialize. Sales were down 8% in the region during the third quarter to $1.99 billion, despite the end of China’s zero-Covid policy that had weighed on operations.
Wall Street analysts had anticipated sales in the region of $2.09 billion, according to StreetAccount estimates.
Sales in China have been soft as consumers contended with sweeping lockdowns and rising infections. While some activity has begun to pick back up, consumers aren’t back to pre-pandemic shopping levels just yet, according to a Citi research note.
Outside China, Nike saw double-digit sales increases in all of its other markets. Sales in North America were up 27% and in Europe, Middle East and Africa, revenue jumped 17% compared with the year-ago period. In Asia Pacific and Latin America, sales were up 10%.
For the last several years, Nike has been working to build out its direct-to-consumer sales and has invested heavily in the channel by building out experiential stores, developing its loyalty program and growing its e-commerce sales.
The investments into its DTC channel has come at a cost, but sales have continued to grow. Nike Direct sales were up 17% during the holiday quarter to $5.3 billion and Nike digital sales jumped 20%.
Selling and administrative expenses were up 15% to $4 billion, the bulk of which was related to wage-related expenses and Nike Direct costs.
As part of its efforts to focus on DTC, Nike has ties with a host of wholesalers, and over the last two quarters has relied on those partnerships to offload inventory. Wholesale revenues were up 12% in the quarter, following 19% growth during the previous quarter.
On Monday, Foot Locker CEO Mary Dillon touted a “renewed” and revitalized relationship with Nike, its biggest brand partner.
A lot of money is on the line for women’s pro soccer in the U.S.
Jeff Halstead | Icon Sportswire | Getty Images
Last year was transformative for women’s professional soccer, as Berman took the helm of an organization that had been plagued with problems ranging from accusations of emotional and sexual abuse and sexism, and an overall lack of confidence in the league.
The NWSL hired Berman, who was a labor lawyer at Proskauer Rose for 13 years, in March 2022, from her role as deputy commissioner of the Premier Lacrosse League. Her biggest priorities? Restore faith in women’s soccer and grow the business.
Since then, the commissioner has made changes to not only drastically transform the culture of the league but also supersize the business through its infrastructure, staffing and rules. Sports Business Journal named her the “Best Hire of the Year” for 2022.
It’s all led to a pivotal moment for the league, as it looks to add more teams and its media deal is up for grabs. Then, this summer, the FIFA Women’s World Cup will put the league’s talent on display – about 25% to 30% of NWSL’s players will travel to Australia and New Zealand for the tournament.
At the moment, the league has momentum. Berman told reporters Tuesday that business is strong and ticket sales are rising.
“Attendance and ticket sales are really the rocket fuel that will grow this league,” she said. “We’re up 20% in season ticket holders on a league-wide basis.”
Building on a strong year
More than 1 million fans attended matches last year, the league said, as nearly every market grew following the pandemic. Attendance was up about 80% in 2022, while ticketing revenue grew more than 125%, according to NWSL.
Sponsorship revenue also surged 87% last year, Berman said. The league averaged 37 sponsorship deals per team, which is more than any other women’s sport, according to sports data and intelligence platform Sponsor United. The league also plans to expand to 14 teams from 12 beginning next year.
The NWSL just signed a deal to bring soccer back to Utah with a new ownership group in a deal reportedly worth between $2 million and $5 million, a major bargain that had been part of a deal negotiated in 2020, before team valuations started to soar.
The league is also in advanced discussions to further expand in San Francisco for 2024, followed by Boston, which is launching “later,” both with a whopping $50 million franchise tag, according to The Wall Street Journal.
Women’s pro soccer valuations are also soaring. It used to take a few million dollars to get in on the league. Today, Angel City FC, based in Los Angeles, is valued at $100 million, according to Sportico.
NWSL commissioner Jessica Berman speaks during the 2023 NWSL Draft at the Pennsylvania Convention Center on January 12, 2023 in Philadelphia, Pennsylvania. (Photo by Tim Nwachukwu/Getty Images)
Tim Nwachukwu | Getty Images Sport | Getty Images
Athletes, celebrities and investors all want a piece of the action. Big name investors include everyone from Eli Manning, Kevin Durant, Sue Bird, Natalie Portman and Jennifer Garner.
“I think, if anything that we’ve learned in the last 11 months, which is that the market will tell us our value so long as we give it the appropriate opportunity to produce that value. And everything that I’ve seen, has validated that,” Berman said.
The league is busy looking for new ownership groups in Chicago and Portland after a yearlong investigation. Portland Thorns owner Merritt Paulson and Chicago Red Stars owner Arnim Whisler both announced in December, they would be selling their teams.
Berman said the vetting stages for new ownership groups in Chicago and Portland are in “advanced stages,” and they aren’t going to set an “artificial deadline.” She said it’s about putting the right person in place who is not just well resourced but also willing to invest in the club to provide a professional environment.
“The old ways of doing business are probably no longer applicable,” Berman said. “We’re not going to close deals in 30 to 60 days. We’re dealing with really sophisticated people who appropriately have questions,” she added.
Berman says they are not looking for the quick win when it comes to ownership, rather finding the right partner.
“We’re looking to go from a mentality of surviving to thriving,” she said. “I think all of that requires a changes in mentality, culture and expectations.”
As part of that transformation, Berman and the league are investing heavily.
The league recently moved its headquarters to Madison Avenue in New York from Chicago. It is also beefing up staff, doubling the number of people in the league office in order to support all the new initiatives they are working on. Berman said multiple teams have doubled or tripled their investment into staffing as well.
“These little things actually matter in terms of having people feel professional and valued,” she said.
In January, ahead of the NWSL draft, Berman outlined major updates to the salary cap. Each team will see a 25% increase from $1.1 million per year in 2022 to $1.375 million in 2023.
Media deal up for grabs
Viewership for NWSL matches also rose 30% last year on Paramount +.
Last year’s championship, which aired in primetime thanks to sponsor Ally Financial upping its financial commitment, was the most-watched game in league history, with a 71% increase in viewership. Paramount+ said it was the most streamed NWSL matched ever, even though it was up against Game 1 of the World Series and a college football game between rivals Michigan and Michigan State.
These metrics should come in handy as the league’s three-year, $4.5 million deal with Paramount Global, which also owns CBS, is set to expire at the end of the new season.
Berman said she’s had robust conversations about the rights, and said there are several interested parties.
“We think that there are some really interesting opportunities here and overseas to consider as we think about growing our brand globally and really claiming our space as the best league in the world,” she said.
The league also announced a recent partnership with EA Sports to feature NWSL players and clubs in EA Sports FIFA game for the first time ahead of a new season.
OL Reign forward Megan Rapinoe (15) scores on a penalty kick during the second half of the National Womens Soccer League game between NJ/NY Gotham FC and OL Reign on September 21, 2022 at Red Bull Arena in Harrison, New Jersey.
Rich Graessle | Icon Sportswire | Getty Images
The NWSL’s culture is under the microscope, as well.
The league is implementing major reforms – from new mandatory training sessions, the addition of anonymous hotlines, player surveys, safety officers, mental health benefits and more.
The league was involved in a yearlong investigation after two former players came forward and accused longtime coach Paul Riley of sexual harassment. Sally Yates, a former top Justice Department official, conducted her own investigation, as well. The reports confirmed the allegations of systemic abuse, sexual misconduct and found “widespread misconduct” in more than half of the league’s teams.
Berman took swift action following the findings, making changes in personnel, putting new infrastructure in place to prevent future problems and issuing massive fines to the offending teams. The NWSL permanently banned Riley and three other coaches who were accused of misconduct. Riley has denied the accusations.
“The teams are really welcoming of the increased focus and support in this area knowing that it is really sort of table stakes as we think about the growth of the league,” Berman said.
Berman spent much of her first year as commissioner on a “listening tour,” meeting with players, coaches and executives to hear “first-hand experiences” and what needs to change.
Today, Berman hopes the new changes and protections will position the league for success.
Berman said she’s heard from players that they are tired from the burdens of having to carry some of weight of culture challenges and reforms.
“I think it’s their hope that we the league and through ownership and management can really take on the burden and work behind the scenes to offer the playing environment that meets the standard that I’ve committed to, which is a place that makes the players proud to play,” Berman said.
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