Strong Quarter for MTN Nigeria as Service Revenue Climbs 42% and Profit Nearly Triples

MTN Nigeria  Communications Plc has reported a strong set of financial results for the first quarter ended 31 March 2026, with service revenue climbing 41.8% year-on-year to N1.489 trillion, driven primarily by data, fintech and voice services.

The results, released on 29 April 2026, reflect the operator’s continued commercial momentum despite a challenging macroeconomic backdrop marked by elevated energy prices and renewed inflationary pressures in the final weeks of the quarter.

Data Leads the Charge

Data remains the engine of MTN Nigeria’s growth story. Data revenue surged 56.2% year-on-year to N827.2 billion, supported by a 9.5% increase in active data subscribers to 55 million and a 5.5 percentage point rise in smartphone penetration to 66.2%. Data traffic grew by 22.9% over the period, while average usage per subscriber rose 12.3% to 14.3GB.

Total mobile subscribers reached 89.5 million, up 6.5% year-on-year, with the operator adding 2.3 million revenue-generating subscribers in the quarter alone.

Margins Expand as Cost Discipline Holds

Despite higher energy costs towards the end of the quarter, MTN Nigeria kept operating expenditure growth contained at 16.1%, well below service revenue growth. EBITDA rose 68.1% to N828.3 billion, with the EBITDA margin expanding by 8.7 percentage points to 55.3%, landing firmly within the operator’s medium-term guidance of a mid-to-high 50% margin range.

Profit before tax rose 169.6% to N546.4 billion, while profit after tax jumped 165.9% to N355.5 billion. Earnings per share climbed to N16.95 from N6.37 in Q1 2025.

Capex Acceleration Signals Long-Term Confidence

Capital expenditure excluding leases rose 92.8% to N390.3 billion, reflecting a deliberate push to expand network capacity and improve quality of service. Capex intensity stood at 26.0% in the quarter, though management indicated it expects this to moderate in the second half of the year.

Free cash flow came in at N326.5 billion, up 55.6% year-on-year, reinforcing the company’s capacity to fund continued investment while maintaining a healthy balance sheet. The quarter closed with a positive net cash position of N129.0 billion and shareholders’ equity of N903.9 billion, up 64.7% from December 2025.

Fintech Momentum; Xtratime Suspension Noted

Fintech revenue grew 77.9% to N64.2 billion. Excluding the impact of the suspended Xtratime service, core fintech revenue rose 190.6%, underpinned by higher deposit balances and stronger adoption of advanced financial services.

MTN Nigeria temporarily suspended Xtratime, its airtime and data credit advance product, following new compliance requirements introduced under the Digital, Electronic, Online or Non-Traditional Consumer Lending Regulations, 2025. The company said recharge patterns have begun to normalise and that no material financial impact is expected once onboarding of approved providers is completed.

Fintech Separation in Progress

The company also confirmed it is advancing the structural separation of its fintech subsidiaries, MoMo Payment Service Bank Limited and Y’ello Digital Financial Services Limited, through a proposed transaction with MTN Group Fintech Holdings B.V. Under the deal, MTN Group Fintech will acquire a 60% stake with MTN Nigeria retaining 40%, alongside a capital injection of N152.1 billion. The transaction was subject to shareholder approval at the AGM scheduled for 30 April 2026, as well as relevant regulatory sign-off.

Commenting on the results, Chief Executive Officer Karl Toriola said the quarter demonstrated the strength of the company’s execution model under pressure. “The first quarter of 2026 underscores the strength of our execution and the resilience of our business model in a complex and evolving operating environment,” he said, noting that the relatively stronger naira, which closed at N1,387 per US dollar, helped partially offset the impact of elevated energy prices.

Toriola said the company expects service revenue growth to normalise from Q2 2026 as the base effects of mid-2025 price adjustments become fully annualised. The company maintains its medium-term guidance of at least low-20% average service revenue growth and an EBITDA margin target in the mid-to-high 50% range, premised on average inflation remaining in the mid-teens and exchange rates holding within the N1,400 to N1,700 per US dollar band.