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Airtel Africa’s latest financial report for the period ending December 2024 has revealed a major revenue decline in Nigeria, its largest market, despite growth in other African regions.
Revenue Decline in Nigeria Amid Rising User Base
The telecom giant, which operates in 14 African countries, including Uganda, Zambia, Malawi, Chad, and Gabon, saw its Nigerian revenue plummet by $500 million, dropping 40.3% from $1.23 billion in 2023 to $738 million in 2024.
This loss comes even as Airtel Africa experienced an 8.2% increase in subscribers in Nigeria, growing from 50.5 million to 52.1 million, and a 37.2% rise in data usage per customer, from 6.2GB to 8.2GB per month.
According to Airtel Africa, the primary factor behind the decline was the significant devaluation of the Nigerian naira. The company reported that the naira depreciated from a weighted average NGN/USD rate of 677 in the previous nine-month period to NGN/USD 1,532 in the current period.
Growth in East and Francophone Africa
Despite facing currency devaluation challenges in Malawi and Zambia, Airtel Africa’s East African operations still increased revenue by $140 million, climbing from $1.22 billion to $1.367 billion in the nine-month period.
Similarly, its Francophone Africa operations recorded a 6.1% revenue growth, rising from $912 million to $968 million. However, overall mobile service revenue dropped by 8.8%, falling from $3.37 billion to $3.07 billion.
Data Remains Airtel’s Primary Revenue Driver
Data continues to be the largest revenue source for Airtel Africa across its markets. However, in Nigeria, data revenue fell by 34%, declining from $539 million to $344 million. In contrast, data revenue in East and Francophone Africa increased by 19.4% and 19.5%, respectively.
Due to Nigeria’s major revenue decline, Airtel Africa’s overall operating profit from mobile services dropped by 23.8%, reducing from $976 million to $744 million.
Broader Industry Trends and Future Outlook
The financial strain on Airtel Africa mirrors the challenges faced by other major telecom operators, such as MTN, which suffered an after-tax loss of ₦137 billion in 2023 and ₦656.4 billion in net foreign exchange losses.
To help cushion the impact of Nigeria’s currency devaluation, the Nigerian Communications Commission (NCC) recently approved a 50% tariff increase for telecom services. Airtel Africa described this as “a balanced approach to ensuring the sustainability of the telecommunications sector while safeguarding the interests of consumers.”
However, industry experts argue that telcos must explore additional revenue sources, as the tariff hike alone may not be enough to offset financial losses.
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