Verizon, AT&T and T-Mobile sell off on SpaceX U.S. network plans

Telecommunications stocks sold off on Friday after Elon Musk‘s SpaceX announced an agreement to purchase a nationwide spectrum portfolio, aiming to expand its Starlink internet into mobile service.

Verizon closed down 8.75% on the news, its worst day since July 2002. Shares of T-Mobile dropped 13.27% while AT&T fell 9.81%, each notching their own worst days since 2013 and 2000, respectively.

SpaceX stock climbed slightly, around 1% for the day.

The deal includes acquiring the spectrum from Grain Management, which SpaceX described as a “license portfolio of up to 14 megahertz of paired spectrum in the 800 MHz band,” in a Thursday statement.

FCC Chair Brendan Carr, whose agency will oversee approval of the deal, said that competition in the spectrum market was “really good news for the American consumers” in a CNBC interview.

“We’re probably going to bring over $100 billion of spectrum into the market over the next two years, so we’re seeing a lot of competition,” Carr told CNBC’s “Squawk on the Street” on Friday.

“There’s going to be moves in the market. People are going to try to out-compete, out-innovate, and I think that’s great. We’re going to see how this plays out. It’s not for us ultimately to pick winners and losers,” he added.

Multiple SpaceX analysts lauded the new spectrum deal, with Evercore ISI writing that the rocket maker “now has the outline of a real network” alongside its existing satellite capabilities. JPMorgan wrote that the acquisition made Starlink Mobile’s long-term opportunity “more credible.”

“That said, we continue to see limited near-term risk to U.S. wireless incumbents given the time, infrastructure and capital required to build a competitive terrestrial network,” analysts added in a Friday note.