MTN Nigeria Nine-Month Profit Climbs 55 Percent

MTN Nigeria Communications grew nine-month profit after tax by 55.3 percent to N1.17 trillion in the period to 30 September, from N750.2 billion a year earlier, as data revenue surged 35.8 percent and the telecoms operator more than paid for its recovery with income tax of N295.4 billion, unaudited results released on Monday showed.

Total revenue rose 23.6 percent to N4.61 trillion for the nine months, while service revenue climbed 23.7 percent to N4.59 trillion. Data revenue reached N2.68 trillion, the largest slice of service revenue, after active data users rose 12 percent to 57.2 million and average monthly usage per active data user increased 16.2 percent to 15.3 gigabytes — a demand mix that keeps Nigeria's largest mobile operator consumer-facing and volume-driven in a market where voice remains the base but plainly secondary business.

Earnings before interest, tax, depreciation and amortisation grew 36.8 percent to N2.62 trillion, widening the nine-month margin to 56.9 percent, with management reporting that the improvement came from higher data consumption and stronger operating efficiency rather than extraordinary items. On the cost side, the operator's energy spend and tower operating expenses have grown far more slowly than traffic for most of 2026, adding margin on every new gigabyte sold.

The company told investors on its earnings call that service revenue accelerated through the quarter, growing 19.7 percent in the third quarter and reaching 21.6 percent in September alone, helped by data, fintech and home broadband while the slower second quarter proved temporary. Free cash flow climbed 57.5 percent to about N1.2 trillion even after higher network spending.

A tax bill nearly fourteen times larger

The clearest sign of the turnaround sits in the cash flow statement, where income tax payments jumped roughly 1,271 percent to N295.4 billion for the nine months, from N21.5 billion in the same period of 2025 — nearly fourteen times the prior-year figure, according to the unaudited consolidated statement of cash flows — a magnitude that dwarfs the operator's entire first-half network spending in most other African markets it serves.

That swing matters beyond the operator itself. Nigerian companies' cash tax payments closely track how the post-devaluation profit cycle converts into actual fiscal inflows, and a bill of this size from a single listed firm illustrates how quickly the corporate contribution to the Federation Account is growing as the naira gains created one-off taxable gains and higher nominal profits for consumer-and-connectivity businesses.

The stock market's verdict

MTN's parent group in Johannesburg recorded its strongest single-day share gain in about a year as the Nigerian numbers landed, with analysts pointing to the group's Nigerian rebound as the main driver of the move rather than any domestic South African development. Shares of MTN Nigeria, which trades over the counter for foreign investors, held near the top of their 52-week US-dollar range.

The gain brackets a running theme for emerging-market telecoms in 2026: operators that survived the 2023-2025 currency shocks with intact balance sheets are now converting pricing discipline into margins, and MTN Nigeria's EBITDA margin widening — 58.7 percent in the third quarter alone — puts it among the strongest operators on the continent, encouraging the group to caution investors less about its most difficult market.

Competition and the fintech race

The results also sharpen the strategic picture inside Nigeria. Data revenue that grew more than two and a half times faster than voice-complemented segments confirms that connection growth has shifted from SIMs to gigabytes, which pressures both capex budgets — denser sites, bigger backhaul — and the fintech ambitions sitting on top of the network.

Fintech was one of three named growth drivers alongside data and home broadband, and the operator's money business competes directly with the bank-led payment platforms that dominate Nigerian card and transfer volumes. Rising data usage feeds that loop: cheaper megabytes pull more customers into digital payments, and every payment session made on the operator's rails adds service revenue the network itself did not carry two years ago.

For investors, the numbers present a balance between momentum and pricing. A 12.7-times forward earnings valuation on the over-the-counter line, with free cash flow growing faster than revenue, leaves room for the market to keep repricing the Nigerian franchise — but only if further naira stability holds, network upgrades keep pace with 15-plus gigabyte monthly usage, and regulators allow the pricing and spectrum decisions that data-heavy operators now need.

For Nigerian businesses and consumers, the signal is industrial rather than corporate: the sector's profitability is rebounding into network investment, and the same quarterly filings that show N1.17 trillion of profit show capital going into the towers, spectrum and fintech rails that determine whether Nigeria's data prices and service quality improve through 2027.