Who can afford to play

Most of the carriers’ cash is spoken for

All five incumbents in this section generate large operating cash flows. What decides each one’s room for manoeuvre is how much remains once the network and the shareholders have been paid (Exhibit 1).

AT&T, Verizon and T-Mobile between them generated $105.4 billion of operating cash flow in FY2025. Capital expenditure took $47.8 billion of that, and dividends took another $23.8 billion. The $33.8 billion that remains is the discretionary money, and it stands against about $337 billion of combined long-term debt less cash. Charter, which pays no dividend, is the exception that shows the pattern: its free cash flow and its free cash flow after dividends are the same $4,418 million.

The same shape repeats across all five companies: operating cash flow is large, capital expenditure takes a big share of it, and dividends take much of what is left. The line that describes strategic room is therefore free cash flow after dividends. The table uses each filer’s own tagged lines rather than any adjusted measure (Exhibit 2).

The debt measure is long-term debt less cash rather than a full net-debt figure, for a practical reason: T-Mobile’s current-debt line is not tagged in a recent filing, and a stale figure would distort the total. The table shows that the carriers are short of uncommitted cash rather than of cash. Every new commitment must displace an existing one, and that condition changes slowly.

SpaceX’s 65 MHz position cost $19.6 billion, about seven months of the three carriers’ combined post-dividend free cash flow. They could not have paid it and funded a network build as well, or paid it without the debt markets noticing.

The bill has since grown. On 8 October 2026 SpaceX agreed to buy Grain Management’s 800 MHz portfolio, up to 14 MHz of paired low band, at a price neither party has stated; the Wall Street Journal reported about $8 billion in cash, and SpaceX had filed nothing on it by 12 October (part 4). At the reported price, SpaceX’s contracted spectrum comes to about $27.6 billion, roughly ten months of the three carriers’ post-dividend free cash flow and about 8.6% of the cash SpaceX itself held on 30 June. A purchase that would have taken a year of one carrier’s discretionary money is, for the buyer, a rounding of its balance sheet. In our view that asymmetry, rather than any single transaction, is what the carriers’ boards are now looking at.

Auction 113 shows the dividend constraint at work

Verizon’s gross winning bids for AWS-3 licences in Auction 113 came to $3.16 billion, which is 37% of its FY2025 free cash flow after dividends of $8,645 million (our calculation). T-Mobile, which pays a smaller dividend and carries less debt, bought more licences than Verizon, 102 against 82, and paid $277.8 million for them, about 2% of its own post-dividend free cash flow. AT&T’s $120.8 million was about 1% of its own. The three bid in the same auction with very different degrees of freedom, and the prior claim on the cash is what separates them.

The satellite operators have freedom to spend but little cash

The satellite side is the mirror image. With no dividend to protect and no legacy network to maintain, every dollar is available for the build, and there are not many dollars. The four operators are not a single category (Exhibit 3).

AST’s revenue is small but real: $70.9 million in FY2025, against $4.4 million the year before. The spending is the larger story. The company put $859 million into capital expenditure in the first half of 2026 while running a $145 million operating cash outflow. Against $2,288 million of cash, that is about fourteen months at the current rate before new financing is needed (our calculation). AST has raised capital repeatedly and may do so again, but the clock is visible in the filings and runs alongside the 9 May 2028 lease expiry from part 2.

EchoStar wrote down its spectrum and then sold it

EchoStar’s FY2025 Form 10-K records the impairments. The company carries its FCC authorisations on the balance sheet at $34,548,952,000 at 31 December 2025. Against that, in FY2025 it recorded pre-tax impairments of $5,784,779,000 on indefinite-lived intangibles, $6.5 billion on long-lived assets and $4.3 billion on operating leases. It reported a net loss of $14.5 billion for the year. The charges are pre-tax and do not sum to the loss; they show the scale of the write-down.

EchoStar has since agreed to sell about 115 MHz for about $39.9 billion before the escrow described in part 4. The AT&T leg closed on 28 July 2026, and the SpaceX leg is approved and expected to close on or about 30 November 2027. The subsidiaries had a harder year. DISH DBS repaid $2.0 billion of senior notes on 28 July 2026 with the authorisation of the US Bankruptcy Court for the Southern District of Texas (Form 8-K, filed 28 July 2026). It emerged from its prepackaged Chapter 11 case in that court on 1 October 2026 (Form 8-K, filed 2 October 2026). Another subsidiary, Hughes Satellite Systems, filed for Chapter 11 on 2 August 2026 (Form 8-K, filed 3 August 2026) (Exhibit 4).

Owning spectrum and being able to use it are different conditions. A balance sheet full of licences is not a business, and EchoStar’s FY2025 shows what the difference costs.

Both owned-spectrum operators are being bought from outside telecoms

Part 1 picked out Globalstar and Iridium as the operators that never appear in the lease records, because they own their spectrum outright. Both have now agreed to be acquired, and neither buyer is a telecom company. The terms below are from each company’s Form 8-K rather than from the accompanying announcements (Exhibit 5).

Iridium, the one unambiguously profitable business among the four satellite operators, with $872 million of revenue and $114 million of net income in FY2025, is being bought. Globalstar, the other operator that never had to rent the spectrum it uses, is going the same way. Both owned-spectrum incumbents pass into other hands within eleven weeks of each other.

We read the two agreements as demand rather than distress. Owned mobile-satellite spectrum has become an input that Amazon, Rocket Lab and SpaceX want, and none of the three is a telecom incumbent.

Cash flow and freedom of action have ended up in different hands

The filings show three positions, and no company holds both cash flow and freedom of action.

• The carriers have the cash flow and lack the freedom. Their operating cash flow dwarfs the satellite side’s, but capex, dividends and debt service get to it first. They can win an auction but cannot fund a second, parallel network.
• The satellite operators have the freedom and lack the cash. AST has about fourteen months of visible runway, Globalstar and Iridium have agreed to be acquired, and EchoStar has sold the asset and closed half of the sale.
• The capital is arriving from outside the industry. Amazon, Rocket Lab and SpaceX, a public company since its June 2026 offering, are funding this from balance sheets that no US carrier can match and no satellite operator ever had. SpaceX’s October agreement for the 800 MHz band, at a reported $8 billion, is the latest instance; the seller is a private investment firm that had bought the band from T-Mobile.

SpaceX’s balance sheet has been public since its June 2026 prospectus, and the first thing it shows is scale. Its first Form 10-Q reports $93,522 million of cash and cash equivalents at 30 June 2026, nearly three times the cash of the nine other companies on this page combined (Exhibit 6). All three buyers now file with the SEC. A filing still cannot isolate SpaceX’s phone business, because satellite-to-phone is reported inside the Enterprise & Government line of its Connectivity segment, so the direct-to-cell economics remain the one figure in this market that cannot be read from a filing.

Terms used

• Free cash flow. Operating cash flow less capital expenditure, both as filed. Free cash flow after dividends also deducts the dividends paid; it is the money left for anything new.
• Long-term debt less cash. The debt measure used here in place of net debt, because one filer’s current-debt line is not tagged in a recent filing.
• XBRL. The machine-readable tagging of SEC filings. Reading the tags gives each company’s own definition of a line, which is why the tables note where definitions differ.
• Prepackaged Chapter 11. A bankruptcy case filed with a reorganisation plan the creditors accepted before filing, so the company can emerge quickly. DISH DBS filed one on 30 June 2026 and emerged on 1 October 2026.
• Carrying value. The amount at which an asset is held on the balance sheet after impairments, which differs from what a buyer would pay for it.