What the Blue Origin explosion means for Amazon’s satellite ambitions
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Stocks lost a bit of steam in afternoon trading on Friday. The S & P 500 and the Nasdaq Composite are hovering near the flatline despite falling oil prices. It’s a subtle session to cap off a strong May, with the S & P 500 up 5% and the Nasdaq adding over 8%, fueled by the remarkable rally in artificial intelligence stocks. With both indexes coming into the day at record highs, it’s hard to blame anyone for wanting to take a little bit off the table heading into the weekend, especially amid uncertainty over the Iran peace talks. President Donald Trump said earlier in the day on Truth Social that he’s going “to make a final determination” on Iran’s demands. Within the portfolio, our biggest winners for the month are chip designer Arm Holdings , up more than 67%, followed by cybersecurity vendors CrowdStrike and Palo Alto Networks , up roughly 63% and 55%, respectively. Amazon’s satellite ambitions hit a potential snag after Blue Origin’s New Glenn rocket exploded Thursday night during a launch test at Cape Canaveral, Florida. The incident raises questions about the timeline for Amazon Leo, the company’s planned low-Earth orbit broadband satellite network. The Blue Origin explosion occurred during a ground test while the rocket remained secured to the launch pad; no injuries were reported. The plan was for the rocket to launch 48 Leo satellites into orbit. Blue Origin said the satellites were not onboard at the time of the explosion. Still, the incident is under investigation and could potentially delay future launches. This matters for Amazon because Blue Origin’s New Glenn rocket is part of the company’s strategy to deploy thousands of Leo satellites into orbit. In a March blog post , Amazon said it had a total of “24 firm launches on New Glenn.” Blue Origin is owned by Amazon founder Jeff Bezos, who remains the e-commerce giant’s executive chair. Amazon has other launch providers through agreements with United Launch Alliance, Arianespace, and Elon Musk’s SpaceX. For investors, the news highlights a big challenge facing Amazon’s satellite business, which is slated to begin initial commercial service in the third quarter. Amazon has deployed about 240 satellites over the past year. The company is racing to build a space-based internet network capable of competing with SpaceX’s Starlink, which already has thousands of satellites in orbit and benefits from the industry’s most active launch platform. SpaceX has conducted more than 600 launches and currently handles the majority of global orbit launches. To be sure, Amazon’s use of multiple launch providers reduces the risk that any single launch failure derails its plans. And because no satellites were on board the New Glenn vehicle at the time of the explosion, Amazon avoided losing valuable inventory. However, delays could complicate Amazon’s efforts to deploy satellites on time as it competes with the incumbent Starlink. Amazon did not respond to CNBC’s request for comment on Friday. Separately, an FCC filing published this week provided details on Amazon’s previously announced acquisition of Globalstar , including the transfer of Apple’s 20% ownership stake. As we explained in April , Amazon’s bid to acquire Globalstar is an important part of its plan to expand its satellite offerings into so-called direct-to-device services. Next week starts off strong, as Nvidia CEO Jensen Huang will give his keynote at Computex in Taiwan Monday morning local time. Also on Monday, Club name FedEx’s freight spin-off begins trading under the name FedEx Freight with the ticker FDXF. Another conference on our radar is Microsoft’s developer event Build in San Francisco, beginning Tuesday. We’ll also hear from a trio of Club names next week, with Palo Alto Networks on Tuesday night and CrowdStrike and Broadcom on Wednesday evening. Palo Alto and CrowdStrike have been scorching hot — as mentioned earlier — so expectations are elevated into the release. Broadcom has its groove back after a mid-May pullback and touched a fresh all-time high Friday. On the economic side, it is all about jobs data, highlighted by next Friday’s May nonfarm payrolls report. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.