Apple is set to invest up to $1.5 billion in American satellite provider Globalstar Inc. to enhance iPhone communication capabilities, particularly in areas lacking traditional network coverage, according to a recent report by Reuters.

Under the terms of the agreement, Apple will provide $1.1 billion in cash, alongside a $400 million equity purchase, granting it a 20% stake in Globalstar. The satellite provider announced it would use a portion of the funds to reduce existing debt, says Reuters. This funding boost also aligns with Apple's interest in satellite technology, enabling iPhone connectivity solutions independent of traditional telecom networks.

The funding agreement specifies that Globalstar will allocate 85% of its network capacity exclusively to Apple, supporting the company's goal of improving connectivity for iPhone users in underserved or remote areas. As part of the arrangement, Globalstar is expected to deploy new satellites and other infrastructure necessary to meet Apple's connectivity requirements. 

Following the announcement, shares of Globalstar surged by over 30%, reports Reuters. Apple's shares, however, declined by approximately 1.4% as the company had recently signalled lower-than-expected quarterly revenue growth. 

This agreement comes as Apple and its competitors increasingly explore non-terrestrial networks to bolster service availability worldwide. It also marks another step in Apple's strategy to leverage satellite connectivity, building on a partnership with Globalstar established in 2022 to enable iPhone users to send emergency messages from remote locations.