Safaricom H1 profit jumps 52% as Ethiopian losses narrow 

Safaricom, Kenya’s biggest telco and most profitable company, has posted strong half-year results, with profit after tax climbing 52.1% to KES 42.8 billion ($331 million), helped by growth in its M-PESA business and a reduction in losses from its Ethiopian unit.

Total revenue rose 8.1% to KES 204.7 billion ($1.58 billion), supported by an 11.1% jump in service revenue to KES 199.9 billion ($1.54 billion). M-PESA, the company’s mobile money platform, remained the biggest driver, growing 14.1% to KES 88.1 billion ($681.8 million) as usage continued to deepen across Kenya.

Losses from its Ethiopian subsidiary fell to KES 13.3 billion ($102.9 million) from KES 28.2 billion ($218.2 million) a year earlier, as the operation nearly doubled its subscriber base to 11.1 million.

“Ethiopia is full of promise, and we are here for the long term,” said Safaricom CEO Peter Ndegwa. “We’re engaging the government and key stakeholders to navigate market repair caused by currency reforms, which is necessary for a sustainable industry into the future.”

Ethiopian bet

The results underline a shift for Safaricom as it looks beyond its home market for new growth. The company entered Ethiopia in 2022, following the government’s opening of the tightly controlled telecoms sector to foreign investors. It is counting on the vast market — Africa’s second most populous nation — to drive its next chapter.

Cash generated from operations dipped 8.4% to KES 92.3 billion ($714.3 million), reflecting higher investment spending, while net finance costs eased 9.4% to KES 9.9 billion ($76.9 million).

At home, Safaricom remains Kenya’s dominant telecoms operator, commanding about 65% of the mobile market and processing the vast majority of mobile money transactions through M-PESA. The platform now generates more than 40% of service revenue and has become integral to Kenya’s financial system, underpinning daily payments, savings and credit for millions of users.

Its strength in mobile money and data has helped the company stay resilient as voice revenue growth slows. Analysts say Safaricom’s ability to build financial and digital services around its network has enabled it to maintain some of the healthiest profit margins in the region.