MTN Nigeria Revenue Soars Amid Market Challenges
MTN Nigeria revenue reached a record high in 2024 despite the company facing financial setbacks. The telecom giant reported a revenue of N3.36 trillion, reflecting strong growth in data services and voice revenue. However, the company also recorded a significant loss due to foreign exchange fluctuations, impacting overall financial performance. The loss was largely attributed to the depreciation of the naira, which increased the company’s financial burden.
The telecom sector in Nigeria continues to expand, with MTN maintaining its position as the largest network provider. The rise in data users and increased internet consumption have driven revenue growth. Despite this, currency devaluation and regulatory policies have posed significant financial risks, affecting the company’s net profit. MTN has made efforts to mitigate these risks by reducing its exposure to foreign currency debt and increasing local investments.
Surge in Subscribers and Data Usage
MTN Nigeria’s revenue has been fueled by an increase in subscriber numbers and data consumption. The telecom company expanded its customer base by 1.6 percent, reaching 80.9 million users. Despite regulatory challenges, including the mandatory disconnection of unregistered SIM cards, the company managed to grow its network. This demonstrates the resilience of the telecom industry in Nigeria, where demand for mobile services continues to rise.
Data usage has also surged, with active data users rising to 47.7 million. The demand for Internet services has grown significantly, leading to a 42.9 percent increase in data traffic. On average, subscribers used 11.2GB per month, showing a shift towards higher digital consumption in Nigeria. This trend highlights the growing importance of mobile internet services in daily life, as more Nigerians rely on smartphones for communication, entertainment, and business transactions.
Record-Breaking Financial Performance
MTN Nigeria’s revenue for 2024 stood at N3.36 trillion, marking an all-time high for the company. The rise in revenue was driven mainly by data services, which contributed N1.59 trillion, a 49.08 percent increase from the previous year. Voice services also performed well, generating N1.30 trillion, up by 14.53 percent. These figures indicate the strong demand for both data and traditional voice communication services in Nigeria.
Despite this impressive growth, MTN recorded a loss after tax of N400.4 billion. This was largely due to foreign exchange losses, which surged to N925.36 billion. The company attributed the loss to the revaluation of foreign currency-denominated liabilities, which impacted overall financial stability. The company’s management has emphasized the need for regulatory interventions to stabilize the exchange rate and reduce the financial burden on businesses operating in Nigeria.
Foreign Exchange Woes and Debt Reduction
MTN Nigeria’s revenue remained strong, but the company struggled with foreign exchange challenges. The depreciation of the naira significantly affected its financial performance. The telecom giant revealed that without forex-related losses, it would have reported a profit of N247.3 billion after tax. The naira’s instability has been a major challenge for businesses operating in Nigeria, as it increases the cost of servicing foreign debts and purchasing imported equipment.
To mitigate risks, MTN reduced its outstanding US-dollar obligations from $416.6 million to $20.8 million by the end of 2024. This move helped stabilize its financial position and limit exposure to currency fluctuations. Additionally, the proportion of naira-denominated debt increased to 72 percent, reducing reliance on foreign currency borrowings. This strategy aligns with the company’s long-term goal of minimizing foreign exchange risks while ensuring steady growth in the Nigerian market.
Capital Expenditure and Debt Financing
MTN Nigeria’s revenue growth has been supported by continued investments in infrastructure. The company spent N443.5 billion on capital expenditure, prioritizing network expansion and operational efficiency. Despite this investment, capital spending declined slightly by 1.3 percent compared to the previous year. The company is focusing on optimizing its resources while ensuring that its services remain competitive in the rapidly evolving telecom industry.
The telecom giant also raised N190 billion from the domestic debt market under its N250 billion Commercial Paper Issuance Programme. This initiative aimed to strengthen its financial standing and support long-term business operations. By shifting towards fixed interest rate borrowings, the company reduced its exposure to fluctuating debt costs. This approach ensures financial stability and allows MTN to continue expanding its network and improving service delivery to customers.
Unsettled USSD Payments and Cash Flow
MTN Nigeria’s revenue includes earnings from financial services, including Unstructured Supplementary Service Data (USSD) transactions. However, the company revealed that Nigerian banks owe it N74 billion for USSD services. Out of this amount, MTN received N32 billion, with the remaining balance expected to be settled in 2025. The delay in payments has been a source of concern for the company, as it affects cash flow and revenue projections.
Despite financial setbacks, the company maintained a positive free cash flow of N388.2 billion. This represented a slight decline of 3.7 percent from the previous year but demonstrated MTN’s ability to generate steady cash flow even in challenging economic conditions. The company’s leadership remains optimistic that improved regulatory policies and better economic conditions will enhance its financial outlook.
Outlook for MTN Nigeria
MTN Nigeria’s revenue remains on an upward trajectory, driven by increasing demand for data services and voice communication. However, the company must navigate regulatory policies, currency fluctuations, and market competition to maintain profitability. The telecom industry in Nigeria is highly competitive, with several players vying for market share, making it essential for MTN to continue innovating and providing high-quality services.
Going forward, MTN aims to enhance its digital transformation strategy and invest in network expansion. The company’s ability to manage forex risks and debt obligations will be crucial in sustaining growth. With Nigeria’s telecom market evolving rapidly, MTN is positioned to capitalize on the increasing reliance on digital services and connectivity. The company also plans to roll out 5G services across more cities, ensuring that Nigerians have access to high-speed internet services.
