News and Analysis
November 12, 2024
Safaricom Plc has released its financial results for the first half of the financial year ending March 2025. The results reinforce the telco’s place as the region’s leading technology and digital financial services provider.
The company recorded group revenues of Ksh181 billion for the half year ending in September 2024 - a 14% increase from the past year. The firm also recorded a Ksh28.1 billion profit over the same period.
Despite a difficult macro-economic environment, the telco announced a 13.1% growth in service revenue, reaching Ksh 179.9 billion, underscoring the loyalty of its Kenyan customer base amid market challenges.
Safaricom’s ‘golden child’—M-Pesa— had revenues surging by 16.6% to Ksh77.2 billion, and mobile data revenue growing by 20.2% year-on-year, Safaricom proves it is far from “expensive and out of reach” for the value delivered.
“We have once again delivered a strong performance in the first half of the 2024/25 financial year despite facing a challenging period. This success reflects the dedication and collaborative efforts of all our staff members, for which I am extremely grateful.”
“Over this period, we have not only connected Kenyans with reliable, safe, and secure telecommunication services, while rolling out cutting-edge products and services. We have played a leading role in enabling financial inclusion, digitising the delivery of citizen services, and growing, enhancing, and always innovating the world-famous M-Pesa platform,” Safaricom CEO Peter Ndegwa said of the progress so far.
The results mark the last of Safaricom's 2020-2025 strategy, transitioning the company from a telecommunications provider to a technology company, and now moving to become Africa’s leading purpose-led technology company by 2030.
M-Pesa: Expanding Financial Accessibility and Opportunities
Despite recent entries and overtures by foreign companies, consumers continue to embrace M-Pesa. Active one-month users have risen to 33.46 million, and data-driven services are expanding as more customers adopt affordable 4G and 5G devices.
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Through its East Africa Device Assembly Limited (EADAK) initiative, Safaricom is producing and financing affordable 4G devices, paving the way for more users to own smartphones, which is crucial as mobile devices serve as entry points for accessing financial services on M-Pesa, mobile banking, and even e-commerce.
Safaricom also recorded growth in its credit services such as Fuliza, Mshwari, KCB M-Pesa, Timiza, and the M-Pesa merchant overdraft. In the year under review (March-September 2024), the value of Fuliza transactions stood at Ksh450 billion, a 7.3% increase compared to the same period last year. For perspective, M-Pesa customers accessed an average of Ksh2.5 billion per day through the Fuliza overdraft service.
M-Pesa transaction volumes and values increased by 30.6%, totaling 17.09 billion transactions, demonstrating the platform’s critical role in handling day-to-day payments, from groceries to bill payments, and providing a safer alternative to cash.
Lipa Na M-Pesa (LNM) active tills rose by 13.6%, indicating the service is becoming an even more ubiquitous payment solution for businesses and consumers.
Savings and Investment
M-Pesa’s investment feature, Mali, saw a 21.6% increase in active customers, reflecting increased adoption of investment options among M-Pesa users. Mali is a Money Market Fund (MMF) that enables M-Pesa customers to invest small amounts and earn passive income.
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This service is especially beneficial to many young adults and emerging investors who want accessible entry points into wealth-building products. Overall, Safaricom customers can look forward to easier access to business-friendly tools, enabling small business owners to accept payments, manage cash flow, and take small loans through merchant overdrafts.
Expanding to Ethiopia
Across the border, Safaricom's performance in the Ethiopian market has been marked by impressive gains in customer acquisition and service growth, but also significant challenges due to economic and regulatory headwinds.
Despite Ethiopia’s hyperinflation and foreign exchange challenges, which impacted revenue translation and operational costs, Safaricom remains optimistic. CEO Peter Ndegwa noted that while the reforms “may be painful in the short term, they are essential for long-term success in Ethiopia.”
The Ethiopian Birr depreciated sharply following major reforms by the Ethiopian Central Bank to float the currency. By the end of September 2024, the Birr had lost 106% of its value against the dollar, resulting in substantial foreign exchange losses for Safaricom Ethiopia.
Despite these challenges, Safaricom’s Ethiopia subsidiary already has a 46% penetration with 52 million customers - already surpassing the Kenyan entity due to the high population. It has a target to reach 55% of the Ethiopian population by mid-2025.
M-Pesa Ethiopia has 8.31 million registered customers and 86.5 million transactions valued at Ksh10.9 billion.
Safaricom Ethiopia has made notable progress toward its mission to secure the promising Eastern African market and the latest numbers paint a promising future.
You Can access the full report here.
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