K2 Space Awarded $22.9 Million Space Force Deal for Orbital Terminals

The Torrance, California, satellite maker will procure, integrate, launch and operate two Enterprise Space Terminals as hosted payloads on its space buses, with work due by November 2028.

First Published: July 31, 2026, 1:21 PM ET

TORRANCE, CALIFORNIA — K2 Space, the Torrance, California, satellite maker founded by former SpaceX engineers, received a $22.9 million contract to build and fly two orbital terminals for the U.S. Space Force.

The firm-fixed-price award covers procuring, integrating, launching and operating two Enterprise Space Terminals as hosted payloads on two separate K2 Space buses, according to the contract announcement as announced on war.gov. Fiscal 2025 research, development, test and evaluation funds of $22.9 million were obligated at award, and the work should finish by November 2028.

“The industry went small. We asked: what happens if you go the other way?” said Neel Kunjur, chief technical officer of K2 Space, according to k2space.com.

The deal marks a further push by the Space Systems Command to buy capability from a fast-scaling private venture rather than a legacy prime, a shift that could lower per-mission costs across defense space programs.

K2 Space, founded in 2022 by brothers Karan Kunjur and Neel Kunjur, designs large, high-power satellite platforms it calls Mega Class buses, according to orbital-intel.com. The company builds roughly 80% of each satellite in-house and says its platform delivers 10 times the power of typical constellation-class satellites, or 20 kilowatts versus 2 kilowatts, according to k2space.com. That vertical integration underpins its pitch of lower cost and faster production for both commercial and government customers.

The contract used the FreeSol Broad Agency Announcement, a flexible acquisition path that lets the government fund research and prototype work outside standard procurement. The Space Based Sensing and Targeting Directorate at Los Angeles Air Force Base serves as the contracting activity under identifier FA8819-26-C-B009.

Money has followed the company’s ambitions.K2 Space has raised more than $398 million across six funding rounds, most recently a $250 million Series C in December 2025 that valued the firm at about $3 billion, according to orbital-intel.com. Lead investors include Altimeter, Redpoint, T. Rowe Price and Lightspeed, according to Google.

For the average reader, the award signals how the Pentagon is spreading orbital work to newer suppliers that promise cheaper access to space. That trend shapes the cost of the communications, navigation and weather services many Americans rely on daily.

This is the first contract to K2 Space in 2026, bringing its total contract value for the year to $22.9 million, according to Defense Department records. It ranks as the 91st defense contract awarded in California during 2026, and it was one of six defense contracts issued nationwide on July 31, 2026.

The next milestone rests with K2 Space and the Space Systems Command as the terminals move toward integration and launch, with completion expected by November 2028. A date for the initial launch has not been announced.

Hosted payloads have a long lineage in military space, as happened before. The Air Force flew a Commercially Hosted Infrared Payload aboard a commercial communications satellite launched in 2011, a $65 million demonstration meant to prove that missile-warning sensors could ride on private spacecraft, according to weforum.org. That experiment helped normalize renting space on commercial buses, opening a door that firms like K2 Space now walk through with far larger platforms.

This contract represents the 1st contract awarded to K2 Space, in 2026, bringing the company’s total contract value for the year to $22,947,034. It is also the 91st Department of Defense contract awarded in California during 2026. While this is not the largest contract ever awarded to K2 Space, whose record stands at $30,000,000, it is notable within the Air Force portfolio. Specifically, it falls between the 2026 Air Force portfolio’s year-to-date minimum of $17 and maximum of $5,600,000,000. Overall, this award was announced among 6 Department of Defense contracts issued nationwide on July 31, 2026.