MTN Nigeria and Airtel Africa Expected to Regain Profitability by 2025

CSL Stockbrokers Limited forecasts that MTN Nigeria and Airtel Africa Plc will return to profitability by 2025 following substantial foreign exchange losses. MTN Nigeria’s revenue grew to N3.36 trillion in 2024, while Airtel Africa experienced a revenue decline. Both companies are implementing strategic measures to mitigate FX losses and manage costs amid rising inflation.

Recent projections by CSL Stockbrokers Limited indicate that the leading telecom providers in Nigeria, MTN Nigeria and Airtel Africa Plc, are anticipated to regain profitability by 2025. This follows significant foreign exchange (FX) losses attributed to the devaluation of the Nigerian naira, which has adversely affected operators’ financial positions. In 2024, MTN Nigeria recorded over N925 billion in FX losses, negatively impacting its balance sheet quality.

Despite the adverse FX conditions, MTN Nigeria maintained a robust revenue growth, achieving a 36.0% year-on-year increase to N3.36 trillion in 2024, up from N2.47 trillion in the previous year. Conversely, Airtel Africa experienced a 5.8% decline in revenue for its 9-month results of 2025, dropping to $3.66 billion from $3.88 billion in 2024, a change linked to substantial currency devaluation in critical markets like Nigeria, Malawi, and Zambia.

MTN Nigeria’s revenue growth was primarily driven by increased data and voice revenues, which surged by 49.1% and 14.5% year-on-year, respectively. In contrast, Airtel reported declines of 2.8% in data revenue and 14.7% in voice revenue, demonstrating the pressure on profitability exerted by currency fluctuations.

Both operators are also facing heightened operational costs due to rising inflation and energy prices. MTN Nigeria’s Direct Network Operating Costs escalated by 88.1% year-on-year to N1.23 trillion in FY 2024, reflecting the intense financial strain. On the other hand, Airtel Africa displayed improved cost management, achieving a slight 1.1% decrease in Direct Network Operating Costs, which fell to $708 million in 9M 2025.

Currency devaluation poses a significant challenge; MTN Nigeria’s extensive FX losses prompted strategic adjustments. The company renegotiated tower lease agreements to secure more favorable terms, transitioning to primarily Naira-based contracts with minimized dollar-linked portions. These measures allowed MTN to report a substantial quarterly profit of N114.49 billion in Q4 2024, marking a recovery from a previous loss.

Similarly, Airtel has localized its foreign debt, reducing FX losses to US$153 million in 9M 2025, a decrease from $903 million the prior year, while also reporting a net profit increase to US$248 million, in stark contrast to the US$2 million profit of 9M 2024.

CSL Stockbrokers noted a favorable outlook driven by increased mobile subscriptions, new tariff implementations, and advancements in network technologies, including 4G and 5G, which bode well for the sector moving forward.

In summary, MTN Nigeria and Airtel Africa are projected to return to profitability in 2025 following significant remedial actions to address foreign exchange losses and operational inefficiencies. Despite facing challenges due to inflation and currency devaluations, both companies have made strategic adjustments that promise a recovery in their financial performances, evidenced by improving revenue metrics and cost management. A positive outlook for the telecommunications sector is supported by growth in mobile subscriptions and network expansions.

Original Source: dmarketforces.com