MTN Nigeria Communications Plc and Airtel Nigeria collectively reported revenues of approximately N3.67 trillion from their data and voice services in the first half of 2024, according to an analysis of their financial results.
MTN, Nigeria’s largest telecom operator with nearly 80 million subscribers, generated N1.27 trillion during this period, fueled by a substantial increase in data service revenue. Of this total, N726.6 billion came from data services, marking a 55% rise from N469.7 billion in the same period last year. Voice service revenue also saw growth, reaching N541.3 billion, up from N474.1 billion year-on-year. The company attributed this success to improved service quality and strong demand for data, alongside price optimization strategies implemented in late 2023.
Airtel, which boasts over 60 million subscribers, recorded $229 million in revenue for the quarter ending June 30, 2024. This figure included $112 million from voice services and $117 million from data services. While voice revenue saw a significant decline of 55.8% from $254 million in the same quarter last year, it showed a 21.6% increase in constant currency. Data revenue also fell by 48.6% from $228 million, yet constant currency figures indicated a solid growth of 41.3%, reflecting rising demand for internet services.
For the full fiscal year ending March 31, 2024, Airtel achieved $711 million in voice revenue and $654 million in data revenue, totaling $1.594 billion. When converted at an exchange rate of N1500/$1, Airtel’s revenue amounted to N2.4 trillion over the six-month period.
Combining the results, Airtel contributed N2.4 trillion, while MTN added N1.27 trillion, resulting in an overall revenue of approximately N3.67 trillion from data and voice services.
Both companies are effectively navigating a dynamic telecommunications landscape, capitalizing on the growing demand for digital services in Nigeria’s expanding digital economy. However, they face challenges due to the depreciating naira against the dollar, which has significantly impacted operational costs.
MTN and Airtel have allocated a substantial portion of their revenues to diesel consumption, as both companies rely heavily on it to power their infrastructure. Industry estimates suggest that telecom operators consume over 50 million liters of diesel monthly.
In light of rising costs, both firms are shifting focus towards renewable energy sources like solar, wind, and lithium batteries. Femi Adeniran, Director of Corporate Communications and CSR at Airtel Nigeria, stated last month that the company spends about N28 billion monthly on diesel. Meanwhile, a senior executive at MTN revealed that the company incurs over N30 billion in monthly diesel expenses for its approximately 25,000 base stations.
Collectively, MTN and Airtel are projected to have spent around N570 billion on diesel between January and August 2024, with diesel prices averaging N1,426.09 per liter.
Despite these challenges, MTN reported a loss of $519.1 billion after tax for the first half of 2024, while Airtel posted an $89 million loss for the fiscal year ending March 2024. However, Airtel achieved a $31 million profit in Q2, despite incurring $80 million in derivative and foreign exchange losses.
