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AST SpaceMobile, Inc. (NASDAQ:ASTS) shares are trading higher on Monday after the company partnered with Japan's Rakuten Group to establish Rakuten AST, Inc., a joint venture focused on developing a direct-to-device satellite communications network in Japan.
The network will use low Earth orbit (LEO) satellites to provide connectivity to commercially available smartphones and strengthen communications infrastructure during disasters and emergencies.
Japan's Ministry of Internal Affairs and Communications (MIC) selected the joint proposal under its Japan Low Earth Orbit Satellite Communications Project (J-LEO).
Rakuten AST is eligible to receive up to 148 billion yen (approximately $1 billion) in government funding over roughly three years.
Under the partnership, AST SpaceMobile will supply satellites for Japan's sovereign mid-band satellite constellation.
The companies aim to deploy and manage the satellites and begin domestic operations by the end of March 2029.
The J-LEO project will use large-scale LEO satellites to extend broadband coverage to underserved areas and maintain connectivity during natural disasters through emergency roaming across mobile operators.
Through Rakuten AST, the companies plan to build and operate a Japan-managed non-terrestrial network.
AST SpaceMobile will supply satellites enabling high-speed internet, including video streaming and social media, on standard smartphones without specialized equipment.
Rakuten AST also plans to explore global service expansion, subject to regulatory approval.
Separately, Rakuten Mobile will work with AST SpaceMobile on AI edge computing and AI-driven spectrum management to develop faster connectivity and IoT solutions for logistics, construction, agriculture and infrastructure monitoring.
Rakuten Mobile also plans to begin commercial-environment testing of its satellite-to-mobile service in 2026 under its partnership with AST SpaceMobile, established in March 2020.
The company will report third quarter earnings results after market close today. Analysts expect the company to report a loss of 40 cents per share and revenue of $46.64 million, according to market data estimates.
Analyst Consensus & Recent Actions: The stock carries a Buy rating with an average price forecast of $75.39. Recent analyst moves include:
Significance: Because ASTS carries significant weight in these funds, any significant inflows or outflows for these ETFs will likely force automatic buying or selling of the stock.
ASTS Price Action: AST SpaceMobile shares were up 14.69% at $37.08 at the time of publication on Monday, according to market data.
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