Safaricom has posted a remarkable 59% jump in annual pretax earnings, signalling a strong recovery for Kenya’s largest telecom operator even as it continues to navigate challenges in its Ethiopia expansion.
The telecom giant reported robust growth across its core business segments, driven by increased mobile money transactions through M-Pesa, higher data consumption, and a growing subscriber base. The results mark a significant turnaround from the previous financial year when earnings were weighed down by heavy investment costs in Ethiopia.
Ethiopia Operations Turning the Corner
One of the most encouraging signs for investors was the narrowing of losses from Safaricom’s Ethiopian operations. The company entered the Ethiopian market in 2022 after securing a licence in a landmark deal, but has faced steep infrastructure costs and regulatory hurdles in building out its network across Africa’s second most populous nation.
However, the latest results suggest the massive bet on Ethiopia may be starting to pay off. Subscriber numbers in Ethiopia have been climbing steadily, and the company has been ramping up its network coverage in key cities including Addis Ababa and Dire Dawa.
M-Pesa Continues to Drive Revenue
M-Pesa remained the crown jewel of Safaricom’s business, processing billions of shillings in transactions daily. The mobile money platform has been expanding its services beyond simple transfers to include savings, loans, and merchant payments, deepening its grip on Kenya’s digital economy.
Data revenue also posted strong growth as more Kenyans consumed video content and used cloud-based services, helped by ongoing network upgrades across the country.
What Lies Ahead
Industry analysts say the results reinforce Safaricom’s position as East Africa’s most profitable company, though questions remain about the timeline for profitability in Ethiopia. The company has indicated it will continue investing heavily in its Ethiopian network while maintaining its dividend policy for shareholders back home.
