Starlink Scraps 260 Satellites in Six Months: SpaceX’s "Space Depreciation" Ledger Surfaces as It Joins Nasdaq 100 Index

The scale itself is not surprising; what is truly worth pondering is its composition: of the 260 disposed satellites, the first-generation V1 accounted for 176, while the more powerful V2 accounted for 84. The V2 boasts stronger processing power and larger transmission capacity, and the market had previously generally expected it to offer superior economics. However, another set of data in the FCC report sent the opposite signal: collision avoidance maneuver frequency. V2 satellites performed 142,015 propulsion maneuvers within six months, more than double that of the V1.

Whether this growth is because the V2 operates in a lower orbit and undertakes more complex networking tasks, or is a passive response to an increasingly crowded near-Earth space, still requires further attribution. But regardless of the driving factor, the doubling of maneuver frequency putting pressure on fuel budgets is an established fact. As maneuver frequency doubles, fuel consumption doubles accordingly, and the effective lifespan of the satellites is significantly shortened due to the premature depletion of propellant. The commercial value brought by performance upgrades is being partially offset by higher operating costs.

Wall Street's pricing of SpaceX has long centered around the core narrative of 'growth,' including user numbers, launch cadence, and global coverage. But this set of data points to another reality: Starlink is transitioning from the infrastructure phase to the operations and maintenance phase. And the core financial variable in the operations and maintenance phase is no longer new users, but rather the depreciation and replacement costs of existing satellites.

SpaceX itself admits that maintaining this 'conservative disposal strategy'—actively deorbiting satellites ahead of schedule rather than waiting for them to fail naturally—requires 'significant investment.' The actual lifespan of each satellite is shorter than its design lifespan; for every day it is shortened, capital expenditures occur one day earlier.

At the current average deorbit rate of about 43 satellites per month, those 349 satellites awaiting disposal represent about eight months of depletion inventory, not yet accounting for the portion of future newly launched satellites destined for early retirement. Starlink not only needs high-frequency launches to replenish losses, but must also run a 'replacement production line' for the long term.

In addition, the FCC report mentioned that the two Gen1 and two Gen2 disposal failures were all hardware issues. Meanwhile, academic research on the large-scale ablation of low-Earth orbit (LEO) satellites in the atmosphere is increasing, with researchers from the CIRES institute at the University of Colorado publicly stating that such large-scale LEO constellation deployments could impact the middle atmosphere.

If the FCC links the 'successful disposal rate' to spectrum renewals in the future, or if the international community begins levying environmental costs on constellation deployments, that 5.7% replacement rate won't just be depreciation—it could become a hard expense, forcing a complete recalculation of Starlink's cost structure.

Coinciding with its inclusion in the Nasdaq 100, expected passive inflows of approximately $4.3 billion provided support for the stock price. However, short interest surged from 13% to 31% of the float within days; while this includes market maker hedging and arbitrage components, the increase in directional shorts remains significant.

Morningstar strategist Michael Field flatly called the valuation 'too high,' pointing out that Starlink trades at nearly 107 times price-to-sales, compared to roughly 21 times for Nvidia. This bull-bear battle is ostensibly about valuation multiples, but its substance is a market-wide reassessment of the capital intensity of Starlink's business model.

Comparing it to traditional satellite operator Intelsat, the latter's depreciation and amortization as a percentage of revenue has long hovered between 15% and 20%. Whether Starlink's satellite replacement rate, when annualized over its full life cycle, will result in a higher depreciation-to-revenue ratio than this cannot be precisely calculated with currently public data.

Starlink's business logic has never been about 'running a single satellite for ten years,' but rather using cheaper satellites and faster iteration cycles to offset shorter lifespans. This model works when launch costs are low enough. However, as orbits become more crowded, maneuvers more frequent, and compliance thresholds higher, this replacement bill may ultimately end up much larger than the depreciation line item in Wall Street models.

This content was translated using AI and reviewed for clarity. It is for informational purposes only.