Olufemi Adeyemi
MTN, the largest telecom operator in the country with nearly 80 million subscribers, announced a total revenue of N1.27 trillion for the first six months of 2024, largely driven by a notable increase in data services.
This revenue includes N726.6 billion from data services, marking a 55 percent rise from N469.7 billion in the same timeframe in 2023. Voice services also saw growth, with revenue climbing to N541.3 billion, up from N474.1 billion year-on-year.
The operator, which has been catering to Nigeria's extensive population for two decades, credited this growth to improvements in service quality and strong demand for data services.
Additionally, price optimization strategies implemented in the fourth quarter of 2023 contributed to this upward trend.
Airtel, which boasts over 60 million subscribers, reported $229 million in revenue for the quarter ending June 30, 2024.
This figure includes $112 million from voice services and $117 million from data services. Despite a significant decline of 55.8 percent in voice revenue from $254 million in the same quarter last year, it showed a 21.6 percent increase when adjusted for constant currency.
Data revenue also fell by 48.6 percent from $228 million in the previous year; however, constant currency figures indicated a strong growth of 41.3 percent, reflecting an increasing demand for internet services.
For the fiscal year ending March 31, 2024, Airtel's report indicated $711 million in voice revenue and $654 million in data revenue, totaling $1.594 billion across both periods.
When converted to naira at an exchange rate of N1500/$1, Airtel's total revenue for the six months amounted to N2.4 trillion.
The combined revenue figures reveal that Airtel generated N2.4 trillion, while MTN contributed N1.27 trillion, culminating in a total revenue of approximately N3.67 trillion from data and voice services over the six-month period.
The two companies are skillfully maneuvering through a rapidly evolving telecommunications sector, taking advantage of the increasing demand for digital services as Nigeria's digital economy continues to grow. Nevertheless, they encounter considerable obstacles, primarily stemming from the depreciating naira against the dollar, which has significantly affected their operational expenses.
Both MTN Nigeria and Airtel Africa, which are publicly traded on the Nigerian Stock Exchange, allocate a substantial portion of their revenues to diesel fuel. Industry experts estimate that telecom operators consume over 50 million liters of diesel each month to support their infrastructure.
In light of these escalating costs, telecom firms are now redirecting their efforts towards renewable energy solutions, including solar, wind, and lithium batteries. Femi Adeniran, the Director of Corporate Communications and CSR at Airtel Nigeria, revealed last month in Lagos that the company spends around N28 billion monthly on diesel.
A senior executive from the telecom sector, who preferred to remain unnamed, indicated that MTN, which boasts approximately 80 million subscribers, faces diesel expenses exceeding N30 billion each month to operate its roughly 25,000 base stations.
Collectively, MTN and Airtel incurred about N570 billion in the first eight months of 2024 due to surging fuel costs, with diesel prices averaging N1,426.09 per liter last month.
In the first half of 2024, MTN recorded a post-tax loss of $519.1 billion, whereas Airtel experienced an $89 million loss for the fiscal year concluding in March 2024. Notably, Airtel was able to secure a profit of $31 million in the second quarter, despite facing $80 million in losses related to derivatives and foreign exchange.