Safaricom hits record Ksh 99.7 billion profit as Ethiopia losses narrow

Safaricom PLC has reported a 67.3 percent jump in group net income to Ksh 99.7 billion for the financial year ending March 31, 2026. This performance represents the highest profit ever recorded by a company in the East and Central Africa region.

The telco saw its group service revenue cross the Ksh 400 billion threshold, eventually settling at Ksh 414.1 billion. This growth was largely underpinned by the double-digit performance of the Kenyan unit and the rapid commercial scaling of operations in Ethiopia.

In the Kenyan market, service revenue rose by 10 percent, contributing a profit of Ksh 119.1 billion. The performance was driven by a 4 percent growth in M-Pesa revenue to Ksh 182.7 billion and a 3 percent increase in mobile data earnings, which reached Ksh 92.9 billion.

The group's overall bottom line was bolstered by the narrowing of losses in Ethiopia. The subsidiary reported a net loss of Ksh 21.2 billion, which is roughly half of the loss recorded in the previous financial year.

Infrastructure development in Ethiopia reached a critical phase during the period. The company has now deployed 3,504 network sites, providing coverage to approximately 60 percent of the Ethiopian population. This expansion supported a subscriber growth of 54.2 percent, reaching 13.6 million active customers.

Total funding for the Ethiopian operation has increased to $2.65 billion. This includes a rise in direct funding from Safaricom PLC, which now stands at $1.22 billion. The investment is part of a broader $8.5 billion commitment by the Global Partnership for Ethiopia (GPE) consortium.

Management noted that deferred vendor payables, which are obligations to infrastructure and equipment suppliers, fell by 70 percent over the last two years. These payables dropped from $301 million in March 2024 to $89 million by March 2026.

Safaricom Group Chief Finance Officer (CFO), Dilip Pal, stated that the reduction in Ethiopia's losses provided a meaningful uplift to the group's performance. He confirmed that the business is now targeting Earnings Before Interest and Taxes (EBIT) breakeven for the Ethiopia unit by the 2027 financial year.

The group's Earnings Before Interest and Taxes (EBIT) rose 59 percent to Ksh 153.9 billion, surpassing earlier management guidance. Following these results, the board has recommended a final dividend of Ksh 1.15 per share, bringing the total payout for the year to Ksh 2.00 per share.

Safaricom CEO, Peter Ndegwa, attributed the results to a strong second-half acceleration. He noted that the Kenyan performance was sufficient to offset the impacts of currency reforms and the timing of market repair actions in the Ethiopian market.

The company is now entering the second year of its Vision 2030 strategy, which focuses on transitioning from a traditional telecommunications provider into a purpose-led technology firm.