What Happened?
Shares of satellite communications provider jumped 4.1% in the afternoon session after the stock's positive momentum continued as the company unveiled a new chip to protect GPS from attacks and a director disclosed a significant purchase of company stock.
Iridium announced its new PNT ASIC chip, designed to shield GPS and other navigation systems from jamming and spoofing. The market for this alternative navigation technology was projected to reach $3.2 billion by 2032, with Iridium's chip scheduled to be available in 2026. Adding to the positive news, company director Robert H. Niehaus bought 30,000 shares for $524,700. Such a large purchase by an insider often indicated strong belief in the company's future. The stock's advance occurred even as Cathie Wood's ARK ETF sold a significant number of shares the previous day, continuing its recent trend of reducing its position in the company.
The shares closed the day at $19.17, up 8.6% from previous close.
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What Is The Market Telling Us
Iridium’s shares are quite volatile and have had 18 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 21 days ago when the stock dropped 5% on the news that investors reacted to signs of growing competition in the satellite communications market after Amazon's Project Kuiper outlined plans to expand its services.
The news followed a meeting where a delegation from Amazon detailed plans to launch its Project Kuiper satellite broadband service in Pakistan. This expansion by a major technology company highlighted the increasingly crowded field for satellite communications. For existing players like Iridium, the entry and growth of well-funded competitors such as Amazon's Kuiper and others like Starlink signaled a more challenging market ahead, potentially putting pressure on future growth and market share. Adding to the weakness, markets pulled back as worries over worsening trade relations with China were triggered by critical comments from President Donald Trump. Trump targeted China's tightening controls on rare earth metals, which are vital components in many technology products from electric vehicles to defense systems. The president's tone and the suggestion of canceling a meeting with President Xi caused a rapid sell-off in the market.
Iridium is down 35.6% since the beginning of the year, and at $19.05 per share, it is trading 41.7% below its 52-week high of $32.66 from February 2025. Investors who bought $1,000 worth of Iridium’s shares 5 years ago would now be looking at an investment worth $704.51.
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