Safaricom reaches 52 million subscribers in Ethiopia

Feyisayo Ajayi -
Key Points
  • Safaricom Ethiopia surpasses 52 million subscribers within two years, capturing 46% of Ethiopia’s population and driving robust expansion in the telecom sector.
  • Currency depreciation hits profits; Safaricom reports a 17.7% drop in half-year profits amid Ethiopian Birr losses, despite subscriber growth.
  • M-PESA expansion sees 8.31 million registered users, fueling Safaricom's growth in new markets.

Safaricom, East Africa’s largest telecom operator, led by Kenyan tycoon Peter Ndegwa, has reached a significant milestone in Ethiopia, surpassing 52 million subscribers—46 percent of the country’s 112 million population—just two years after entering the market.

The telecom giant reported this milestone with its half-year results, marking rapid growth in one of Africa’s biggest telecom markets. Group Chairman Adil Khawaja said Safaricom is meeting its license obligations and aims for 55 percent population coverage by June 2025.

Safaricom entered the Ethiopian market in October 2022, becoming the first private operator following a successful bid of Ksh110 billion ($853 million) for its license. The operator is on track to meet its target of 55 percent population coverage by June 2025. 

Ethiopian expansion boosts Safaricom's user base

Safaricom’s Ethiopian unit is grappling with a steep 106 percent depreciation of the Ethiopian Birr, which fell to 118.99 per U.S. dollar on Sept. 30 from 57.69 in June. The devaluation has weighed on the unit’s profitability, as reflected in Safaricom's financial results.

Despite the currency hit, Safaricom Ethiopia posted strong growth in key areas. Voice revenue jumped 27.1 percent to Ksh516.4 million ($3.99 million), supported by rising usage and a growing customer base. Active voice customers rose 63.8 percent to 3.57 million, with call minutes up 52.2 percent to 97.15 million.

Mobile data usage remains robust, with active data users doubling to 3.5 million. Average data use per subscriber increased to 6.56GB per month, pushing ARPU up 10.8 percent to Ksh199.91 ($0.15).

M-PESA also gained traction, bringing in Ksh24.4 million ($0.18 million) in revenue for the half-year. Registered M-PESA users reached 8.31 million, active agents grew to 3,160, and Lipa M-PESA merchants climbed to 6,660.

Safaricom sees profit drop, eyes expansion

Founded in 1993 and based in Nairobi, Safaricom has grown into a telecom powerhouse, offering services from mobile connectivity to cloud hosting and M-PESA payments.

Under Peter Ndegwa, the company is committed to global expansion and environmental, social, and governance (ESG) initiatives, reinforcing its importance in Kenya’s economy.

Half-year profit for the period ending Sept. 30, 2024, dropped 17.7 percent to Ksh28.1 billion ($217.8 million), down from Ksh34.1 billion ($264.3 million) a year earlier, hit by a Ksh17.5 billion ($135.7 million) loss due to a 51.1 percent Ethiopian Birr depreciation, despite subscriber growth reaching 52 million.

The company remains an important player in Kenya’s economy, contributing $7.6 billion and supporting 1.28 million jobs in the last financial year.