Bank of America has told clients that SpaceX’s push into mobile service could reshape Apple’s business in the United States, with analyst Wamsi Mohan setting out three risks in a note published on Monday. The warning, reported on 12 October 2026 by Yahoo Finance executive editor Brian Sozzi, follows SpaceX’s statement late last week that it had bought a nationwide low-band spectrum portfolio.
The three risks BofA names
The first is the carrier subsidy model. Mohan’s note said subscribers who switch to Starlink potentially lose the carrier promotional credit, which could lengthen their replacement cycle or push them to trade down to lower-end phones.
The second is a rival device. Yahoo Finance reports Mohan raised the possibility of a competitive handset taking share from Apple, referring specifically to a Grok-powered low-cost SpaceX phone.
The third is the wider ecosystem. Integration with Tesla and SpaceX including Grok — Elon Musk’s artificial-intelligence assistant — “creates an end-to-end competitor including AI capabilities,” Mohan wrote, in comments carried by Yahoo Finance.
Revenue is not where he placed the main risk. “We see the bigger risk as the valuation multiple where the debate becomes US iPhone pricing power and the durability of the US premium mix with lower carrier subsidies,” he wrote. The investor question, on that framing, is whether Apple can keep selling expensive phones in its home market if the discounts that have carried them to customers shrink. Near term, Mohan said carriers are likely to defend their base with heavier promotions — which he described as a tailwind for upgrades.
The arithmetic behind the $6 billion
Mohan built the estimate from volume rather than price. On his figures, roughly 53 million iPhones a year pass through AT&T, Verizon and T-Mobile, each carrying a blended $800 promotional credit. Move a tenth of those carriers’ postpaid phone subscribers to SpaceX, he said, and Apple loses about 5 million units and $6 billion in revenue.
Three things follow from his own inputs, on our calculation rather than his. At $800 across 53 million units, the Big 3 are channelling on the order of $42 billion a year into iPhone discounts — the pool a satellite entrant would begin to drain. At $6 billion across 5 million units, the implied revenue per lost handset is about $1,200, towards the upper end of Apple’s US line-up, which is consistent with his argument that the premium mix is what is really exposed. And a straight 10% of 53 million units would be 5.3 million, not 5 million, suggesting the unit figure is derived from the carriers’ subscriber base rather than from unit share.
Starlink-news has not seen the BofA note, which was distributed to clients rather than published; the quoted figures are as carried by Yahoo Finance and have not been confirmed by Bank of America to this site.
A second analyst, and a deal that is not done
The device risk is the one point where more than one sell-side view now points the same way: another analyst note on a possible Starlink handset published last week reached a similar conclusion about pressure on carriers and on Samsung, before BofA’s note appeared. Mohan’s contribution is to extend that logic to the money carriers spend on discounting rather than to the handsets themselves.
Both arguments rest on a transaction that still needs regulatory clearance. Spectrum licences in the United States cannot simply change hands: the assignment has to be approved by the Federal Communications Commission, and until it is, SpaceX cannot use the airwaves commercially. Nothing in the reported note assumes a date for that approval.
What a US subsidy fight could signal for Starlink elsewhere
The licences in question are American, and so is the competitive threat Mohan describes — AT&T, Verizon and T-Mobile. But the mechanism he is pointing at travels badly, and that is itself informative for readers tracking Starlink outside the US. In markets where handsets are generally bought outright rather than bundled into a contract, including much of Africa, there is no subsidy pool for a satellite entrant to disrupt. A Starlink Mobile offer in those markets would have to win on tariff and coverage alone, which is the same test Starlink’s residential satellite internet service already faces there.
The sequencing matters too. Because spectrum is licensed country by country, any mobile service beyond the US would need its own national spectrum arrangement and regulator — which is why Starlink’s international footprint today is fixed satellite internet rather than phone service. If and when SpaceX publishes US mobile tariffs, those prices become the first public reference point for what a direct-to-handset product costs, and the benchmark against which later launches elsewhere will be read.
What the note does not say
Yahoo Finance reports no timetable for Starlink Mobile, no tariffs and no launch date, and SpaceX has not published pricing for the mobile offering in the material cited. Apple is not quoted in the report, and neither SpaceX nor the three carriers are recorded responding to Mohan’s estimates.
Frequently Asked Questions
What is low-band spectrum, and why does it matter for a mobile service?
Low-band refers to the lower radio frequencies used by mobile networks. As a general property of radio, signals at those frequencies travel further from each transmitter and pass through buildings more readily than higher-frequency airwaves, but they carry less capacity. That trade-off is why low-band licences are prized for wide-area coverage — the kind of footprint a satellite-plus-ground operator would need to look like a national carrier rather than a niche add-on.
What are ‘postpaid phone subscribers’, and why does the subsidy sit with them?
Postpaid customers are billed monthly after use, usually on a contract or device instalment plan, as opposed to prepaid users who pay in advance. Carrier handset promotions are typically structured as bill credits spread over that contract, so the discount only works if the customer stays. That is the mechanism Mohan’s $800 blended figure describes, and it is also why a customer leaving for a different network is the event that breaks it.
Would customers need a special phone to use Starlink Mobile?
No. According to Mohan’s note as reported by Yahoo Finance, Starlink Mobile works on unmodified handsets, and he said that for that reason most people switching would keep their existing iPhone or buy a new one. That detail is what makes his subsidy argument a revenue question rather than a compatibility one.
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