MTN Nigeria recently released its unaudited results for the third quarter of the month (Q3), which ended September 30th, 2024, showcasing a resilient performance despite macroeconomic pressures.
During the year, the company experienced growth in its key business segments, highlighting the resilience in the demand for data, voice, fintech, and digital services, each delivering double-digit growth.
MTN delivered a growth of 52.3% in data revenue, driven by an expansion in user base and data usage. The growing demand for digital services, social media, and streaming content has been crucial in driving data consumption. As a result, the average data usage per customer increased by 31.2%, reaching 11.2 GB, while overall data traffic grew by 42.1%.
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Significant progress was recorded in scaling its position in the home broadband market, adding over a million new home broadband subscribers. This brings the total number of subscribers using the 5G fixed wireless access devices, mobile broadband solutions, and fiber-to-the-home connectivity solutions to over 3 million.
MTN’s Fintech revenue grew by 18.0%, with an acceleration in Q3 (up 32.3%) with Xtratime contributing significantly to the growth. In Q3, the company streamlined the incentive structures in its sales and distribution channels. As part of this, it went ahead to rationalize the sales force to focus on service penetration, improve monetization, and reduce acquisition costs.
This impacted the evolution of the ecosystem indicators in the short term, with a decline in active wallet (down 21.7%), agent (down 81.5%), and merchant (down 53.3%) bases. Overall, the company expects these interventions to enhance the profitability of the MoMo PSB ecosystem.
Despite these trends, transaction volume increased by 16.6% YoY overall, demonstrating improved quality and the underlying demand momentum in the ecosystem. The company announced plans to continue the work to deliver a compelling product portfolio and user interfaces, with a focus on advanced services to sustainably scale the business in line with our strategy.
Revenue from digital services continued to accelerate, rising by approximately 103%. This increase was driven by higher adoption of expanded digital offerings and improvements to the user journey experience. This significant growth was achieved, despite NCC’s NIN-SIM directive, which impacted its user base in Q3. MTN ended the period with approximately 16.2 million users, reflecting a 0.7% increase YoY.
Commenting on the company’s performance, MTN Nigeria CEO, Karl Toriola said,
“Despite persistent macroeconomic pressures and regulatory challenges, we maintained our growth momentum. The challenging inflationary environment and naira depreciation impacted consumer spending power and business activity. However, we focused on operational efficiency and commercial growth.”
As MTN moves into the final quarter of 2024, the company anticipates that ongoing macroeconomic pressures which include high inflation and forex volatility, will continue to impact consumer spending and businesses. However, it has assured to remain focused on implementing strategic initiatives to mitigate the impact on overall operations.
In this regard, MTN Nigeria plans to prioritize the recovery of its subscriber base, which was impacted by the NIN-SIM directive. At the same time, it highlights plans to remain engaged with regulatory authorities to make tariff adjustments for the sustainability of the industry and its value chain.
Against this backdrop, the company remains optimistic about a constructive outcome from industry tariff engagements, which it believes will support the recovery of profitability and balance sheet profile, as well as the medium and long-term growth of our business.
In fintech, it has streamlined its sales and distribution model to drive quality and more profitable growth in its business. In this context, MTN will continue to prioritize the accelerated adoption of wallets, focusing on advanced services and the MoMo PSB app to enhance the user experience and engagement.
Notably, the company highlighted a significant plan to continue implementing appropriate interventions to navigate the challenging operating environment as it executes its strategy to sustain growth. This includes driving cost management across the business through expense efficiency programs and strengthening operations and financial positions to support the recovery of overall capital position.