16 February 2026 | 5:52AM GMT Equity Research The discussion explored two key themes: 1) space data centres, which do not yet exist but could become viable, and 2) satellite connectivity as a telco service, which is already in action. In the longer term, space datacentres appear an increasingly likely reality. More relevant today, our conversation suggests the extent of investor concerns on satellite competition to telecoms and towercos are overstated - as we wrote in our 2025 satellite/telco report. Satell ...

In less than 2 months since Starlink Direct to Cell launched in Ukraine, 3M+ people have subscribed to the satellite-to-mobile serviceVEON (@VEONGroup):📢 Kyivstar reaches 3 million registered users of Direct to Cell satellite connectivity services powered by @Starlink.Since the launch of Direct to Cell last November, more than 1.2 million SMS messages have been delivered through satellite connectivity, with the rapid adoption https://t.co/S8UhsmsMtb ...

Core Thesis - Vodafone Group Public Limited Company is perceived as a low-growth telecom company despite having significant asset value, including a 45% stake in tower and infrastructure assets worth approximately $10 billion [2] Valuation and Market Perception - Vodafone's share price was $13.18 as of January 13, with trailing and forward P/E ratios of 20.37 and 37.45 respectively [1] - The market continues to price Vodafone as a "boring" income stock, with a stock price of 96p as of December 23, 2025, reflecting no credible growth options [3] Growth Opportunities - Vodafone's exposure to AST SpaceMobile and its European joint venture, Sat-co, could represent significant growth potential, which is largely ignored in current valuations [3][4] - AST SpaceMobile's equity has increased significantly, now exceeding Vodafone's market capitalization, with Vodafone holding 14.5 million shares worth approximately $1.2 billion [4] Strategic Importance of Sat-co - Sat-co aims to provide direct-to-device broadband and voice connectivity across Europe using AST's LEO satellites, which could eliminate coverage gaps without new hardware [4] - Full European coverage is expected by the end of 2026, with interest from mobile operators in 21 EU countries [5] - The strategic importance of Sat-co is enhanced by upcoming European S-band spectrum allocation and rising defense spending, positioning Vodafone favorably against competitors like Starlink [6] Financial Impact - If Sat-co generates over €1 billion in incremental EBITDA for Vodafone, it could significantly improve earnings growth, quality, and free cash flow, potentially leading to a re-rating of Vodafone's valuation multiples [6]

Core Insights - AT&T, Inc. has seen a decline of 5.1% over the past three months, underperforming compared to the Wireless National industry, which decreased by 7%, and the S&P 500 [1][8] - The company has also lagged behind peers such as Verizon Communications Inc. and Comcast Corporation, which saw declines of 2.2% and 5%, respectively [2] Key Challenges for AT&T - The U.S. wireless market is highly saturated and competitive, leading to price sensitivity and aggressive promotions among telecom companies [3] - AT&T faces risks associated with high customer churn rates and retention costs, compounded by competition from Verizon and T-Mobile, which are rapidly expanding their 5G networks [3] - The company is also contending with a significant long-term debt burden of $128.09 billion, which has increased from $123.06 billion in the previous quarter [5] Growth Drivers for AT&T - AT&T is focusing on onboarding converged customers who will purchase multiple services, which may lead to better long-term margins despite short-term moderation in Average Revenue Per User (ARPU) growth [4] - The company is investing in edge computing services, which are expected to provide a competitive edge and cater to high-bandwidth applications in various sectors, including autonomous vehicles and drones [9] - AT&T boasts one of the largest 5G networks, covering over 310 million people across 26,100 locations, and is leveraging millimeter wave spectrum for urban deployment [10] - The U.S. 5G services market is projected to grow at a compound annual growth rate of 51.1% from 2025 to 2030, and AT&T is expanding its infrastructure to capitalize on this trend [11] - Collaborations with AST SpaceMobile aim to enhance satellite connectivity, addressing connectivity issues in rural areas [12] Financial Metrics - Earnings estimates for AT&T for 2025 have increased over the past 60 days, while estimates for 2026 remain unchanged [13] - From a valuation perspective, AT&T is trading at a price/earnings ratio of 10.88, which is lower than the industry average of 11.73 and the company's historical mean of 12.56 [15] Strategic Outlook - The company's strategy of enhancing network infrastructure and 5G capabilities is expected to drive subscriber growth and improve service quality, particularly in rural areas [17] - The focus on acquiring converged customers is anticipated to positively impact ARPU in the long run [17]

Core Insights - Apple Inc. is advancing its decade-long satellite connectivity project, focusing on innovative features to enhance satellite services [1] - The initial goal of replacing cellular networks with satellite connectivity was deemed impractical, leading to the development of Emergency SOS via Satellite [2] - Apple has expanded its satellite services since the launch of the iPhone 14, introducing features like roadside assistance and text messaging in remote areas [3] Group 1 - The Satellite Connectivity Group (SCG) oversees Apple's satellite services, led by Mike Trela [3] - Compatible devices include iPhones and the Apple Watch Ultra 3, with potential future expansion to iPads [4] - Apple is committed to its satellite vision despite competition from companies like SpaceX and Starlink [5] Group 2 - The company is developing additional features such as a satellite framework for third-party apps and enhanced messaging capabilities [5] - Industry dynamics may require Apple to adjust its strategy, especially with Globalstar considering a sale [6] - Despite potential shifts in the industry, Apple remains focused on its long-term satellite vision [6]

Product Testing & Validation - Apple tests Apple Watch Series 11 antenna performance in a controlled environment to eliminate external interference [1][2] - Apple simulates real-world conditions by testing how the human body affects Apple Watch signal transmission [2] - Apple Watch Ultra 3 location transmission accuracy is tested using satellite connectivity in a specialized chamber [3] - Apple recreates satellite geometry to simulate any location on Earth for testing emergency SOS and location sharing features [4] Product Development Cycle - Apple's testing process can take up to a year, suggesting continuous product development and testing cycles [4]

Technology & Connectivity - SpaceX's Starlink Direct to Cell technology is being tested in Ukraine [1] - The technology aims to provide satellite connectivity to every Ukrainian's smartphone [1] - Kyivstar CEO Oleksandr Komarov is involved in testing the Starlink technology [1] Future Availability - The technology is described as a technology of the future and will soon be available [1]