Safaricom Ethiopia Races Toward Breakeven With 14.7 Million Customers

Ethiopia · Telecoms

Safaricom Ethiopia is growing faster than any unit in the Kenyan telecoms group. Four years after entering Addis Ababa, it has 14.7 million active customers, triple-digit revenue growth and a credible path to breaking even by March 2027.

The quarterly update, reported at the end of July, shows active customers up from 10.06 million a year earlier. Voice users grew 37% to 12.03 million, data users reached 11.52 million, and M-Pesa counted 5.69 million three-month active customers.

Momentum is building where it matters most. Mobile money is the historic profit engine of the parent group in Kenya, and Ethiopia’s M-Pesa base more than doubled over the past financial year.

Losses halved, breakeven in sight

The Ethiopian start-up has been the drag on Safaricom’s accounts since launch. In the financial year to March 2026, that drag shrank sharply, with the unit’s loss more than halving to KSh 21.2 billion (US$164 million).

Tariff reviews on voice and data, introduced in late 2025, did much of the work. Group finance chief Dilip Pal says the trajectory points one way: “it shows that we are geared for positive EBITDA breakeven in FY27.”

The numbers behind that confidence are striking. Service revenue grew 130.9% to ETB 15.9 billion (US$114 million) in FY26, and Ethiopia contributed 15% of the group’s total service-revenue growth.

Guidance for FY27 keeps the discipline. Ethiopian capital expenditure falls to between KSh 6 and 9 billion (US$47–70 million), from KSh 18.7 billion (US$145 million) the previous year, as the market exits its peak investment phase and shifts to sweating the network it has built.

A US$2.6 billion bet on liberalisation

Safaricom entered Ethiopia in 2022 as the first private challenger to state-owned Ethio Telecom, in what remains one of Africa’s boldest telecoms openings. Total funding into the venture had reached US$2.6 billion by March 2026.

The network now spans 3,504 sites and covers 59% of the population with 4G. Its 963 permanent staff are 98% Ethiopian — a localisation record few foreign operators in the region can match.

The bet now sits inside a new corporate structure. Vodacom completed a US$2.1 billion deal to take control of Safaricom in early July, a transaction The Rio Times covered in detail, tying Ethiopia’s growth story to one of Africa’s largest telecoms groups.

Ethiopia remains the only market where the group runs a greenfield operation of this scale. Safaricom won its licence in 2021 and switched on the network the following year, ending Ethio Telecom’s long monopoly in a country of more than 120 million people.

At group level, the Ethiopian recovery helped Safaricom post a record FY26. The board declared a full-year dividend of KSh 2.00 (about 1.6 US cents) per share, up 66.7% on the prior year.

M-Pesa carried ETB 32.5 billion (US$232 million) across 442.2 million transactions in FY26. Merchant payments and enterprise services are the next layer the company wants to build on top.

The macro storm around the growth

The commercial momentum arrives against a difficult backdrop. Ethiopian inflation climbed to 13.4% in May from 11.7% in April, driven by food and transport costs as Middle East conflict pushed up global oil prices.

The birr depreciated 16.8% against the US dollar in the year to June. For a business that reports in Kenyan shillings and funds expansion partly in hard currency, the exchange rate remains the single largest accounting risk.

Yet the market’s scale keeps the thesis intact. Africa’s second-most-populous country is still early in its mobile-data adoption curve, and Safaricom is the only private network competing for those customers.

What to watch

First, the FY27 breakeven. Management has staked credibility on positive Ethiopian EBITDA by March 2027; any currency shock that delays it will move the Nairobi-listed share price.

Second, M-Pesa monetisation. Doubling users is the easy part; turning them into a payments ecosystem that matches Kenya’s margins is the real test.

Third, integration under Vodacom. The new controlling shareholder has its own pan-African fintech ambitions, and how it sequences Ethiopia within them will shape the venture’s next funding round — watched closely across Eastern Africa.

Frequently asked questions

How many customers does Safaricom Ethiopia have?
Its 90-day active customer base reached 14.7 million in the quarter to June 2026, up 46.1% from 10.06 million a year earlier. Voice users number 12.03 million and data users 11.52 million.

When will Safaricom Ethiopia break even?
Management targets positive EBITDA in the 2027 financial year, which ends in March 2027. The unit more than halved its loss to KSh 21.2 billion (US$164 million) in FY26 after tariff reviews and strong customer growth.

How much has Safaricom invested in Ethiopia?
Total funding reached US$2.6 billion by March 2026, supporting a network of 3,504 sites with 59% 4G population coverage. Ethiopian capex falls sharply in FY27 as the peak investment phase ends.

Who owns Safaricom Ethiopia now?
The unit is part of Safaricom PLC, which came under Vodacom’s control in a US$2.1 billion deal completed in early July 2026. Safaricom retains its Kenyan headquarters and Vision 2030 strategy of becoming Africa’s leading purpose-led technology company.

This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error

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