Hughes Satellite Systems files Chapter 11 bankruptcy amid Starlink competition

Hughes Satellite Systems Corporation filed for Chapter 11 bankruptcy extortion connected Sunday, citing mounting contention from low-earth-orbit outer providers and an inability to repay $1.5 cardinal successful bonds that matured August 1.

The Germantown, Maryland-based company, a portion of Charlie Ergen's EchoStar Corp., filed voluntary petitions successful the Bankruptcy Court for the Southern District of Texas, Houston Division. Hughes had $102 cardinal successful currency connected manus arsenic of the extremity of March, according to The Wall Street Journal, leaving it good abbreviated of the funds needed to screen the debt.

Hughes's lawsuit basal includes astir 641,000 residential subscribers successful agrarian areas of North and South America, arsenic good arsenic defence agencies, airlines, and authorities clients. The company's broadband subscriber basal declined astir 21.7% successful the twelvemonth ending June 30, 2025, according to Bloomberg.

Chief Restructuring Officer Robert del Genio said successful a tribunal filing that contention from operators specified arsenic SpaceX and Amazon Leo — which connection agrarian broadband with little latency and higher speeds — has structurally undermined Hughes's halfway business. "LEO outer contention is structural, not cyclical, and the company's competitors proceed to grow sum and trim costs," del Genio said, according to Bloomberg. The institution does not expect the subscriber diminution to reverse, helium added.

Hughes said it plans to usage the bankruptcy process to reorganize astir enterprise, government, and defence customers. To enactment that pivot, the institution pointed successful its filing to a contracted endeavor pipeline worthy $1.5 cardinal and caller awards it has secured with hose and U.S. defence customers. The institution said it has capable currency to support the concern moving done the restructuring play and has asked the tribunal to let it to grant obligations to workers and suppliers arsenic proceedings continue.

EchoStar and Hughes's planetary subsidiaries are not portion of the Chapter 11 proceedings. The filing has nary interaction connected EchoStar's different brands, including DISH TV, Sling TV, and Boost Mobile, the institution said. White & Case LLP is serving arsenic ineligible counsel and FTI Consulting, Inc. arsenic fiscal advisor to the filing entities.

Creditors representing astir 80% of Hughes's elder bonds by look worth formally enactment the institution connected announcement successful a July 21 letter, asserting fraudulent transfers and violations of fiduciary duty. Hughes pushed backmost done del Genio, who stated successful his filing that the institution rejects immoderate proposition that those claims person merit.