East Africa’s telecom titan rebounds with M-PESA and data leading the charge
After two years of earnings pressure, Safaricom has bounced back, reporting an 11% rise in full-year profit to $540 million (KES 69.8 billion) for the fiscal year ending March 2025. This resurgence is attributed to robust growth in Kenya’s mobile data and M-PESA services, alongside a significant reduction in startup losses from its Ethiopian operations.
Kenya’s Core Drives Revenue Surge
Safaricom’s service revenue climbed 10% year-on-year to $2.8 billion (KES 371.4 billion), with customer numbers increasing by 16% to 57.1 million. The Kenyan market remains the company’s profit engine, bolstered by increased mobile data usage, voice services, and the continued dominance of M-PESA in the mobile money sector.
Ethiopia’s Losses Halve as Expansion Gains Traction
In Ethiopia, Safaricom’s losses reduced by nearly 50% to $165.7 million (KES 21.4 billion), as the company expanded its subscriber base and accelerated the rollout of M-PESA, which launched in August 2023. The Ethiopian unit contributed 9% to group service revenue, indicating promising growth in the new market
Strategic Investments and Future Outlook
Safaricom continues to invest heavily in its Ethiopian subsidiary, focusing on building network infrastructure and scaling M-PESA services. The company projects further narrowing of Ethiopia’s losses to between $178.1 million (KES 23 billion) and $201.3 million (KES 26 billion) in the current financial year. Additionally, earnings before interest and taxes (EBIT) are expected to rise by 50% to $1.16 billion (KES 150 billion) by March 2026.
Here’s What This Means for Nigerians
- Fintech Inspiration: Safaricom’s success with M-PESA underscores the potential of mobile money platforms in driving financial inclusion—a model that Nigerian fintechs can emulate.
- Cross-Border Opportunities: The company’s expansion into Ethiopia highlights the viability of scaling services across African markets, offering insights for Nigerian startups eyeing regional growth.
- Investment Signals: The telecom’s rebound may attract investor interest in African tech ventures, potentially increasing funding opportunities for Nigerian tech companies.
Safaricom’s strategic maneuvers and resilient performance serve as a blueprint for telecom and fintech companies across Africa. As the company continues to innovate and expand, it sets a precedent for leveraging technology to drive growth in emerging markets.
KEEP READING: Stablecoins Transform Cross-Border Payments in Africa
