MTN Nigeria crossed the N1 trillion revenue mark in the first quarter of 2025, recovering strongly from a loss position last year, buoyed largely by the phased implementation of a 50% tariff hike approved by the Nigerian Communications Commission (NCC) and early signs of exchange rate stability.
The telecom giant’s revenue for Q1 2025 rose by 40.5% compared to the same period in 2024, according to its unaudited financial results released Monday. The company also posted a profit after tax of N133.7 billion, reversing the N392.7 billion loss recorded in Q1 of the previous year.
The improved earnings come just months after the NCC gave operators the nod to adjust tariffs upwards by 50%, a move that sparked debate across industry circles but was justified by regulators as necessary for the telecom industry sustainability. For MTN, the adjustment began mid-February and fully rolled out across its data and voice bundles by March — meaning the full impact is expected to manifest in Q2.
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Despite only a few weeks of implementing the new pricing regime, the company reported early resilience in customer demand.
“We commenced phased implementation of the new tariff structure in mid-February… While the full impact on usage and revenue is expected from Q2, early indicators suggest continued resilience in customer demand, aided by our targeted CVM initiatives,” said CEO Karl Toriola.
Surge in Capital Expenditure
MTN’s network investments also spiked during the quarter as it moved to comply with regulatory conditions tied to the tariff increase. The company spent N202.4 billion on capital expenditure (CAPEX), representing a staggering 159% jump from the N78.1 billion it deployed in the same quarter last year.
The NCC had demanded that telcos ramp up infrastructure investments within three months of the approval. Tobe Okigbo, MTN Nigeria’s Chief Corporate Services and Sustainability Officer, noted earlier that “the better the quality [of service], the more money you spend,” adding that poor network quality results in losses for operators as well.
The increased spending appears to have been matched by meaningful growth in network usage. MTN added 3.2 million new subscribers, growing its total base to 84.1 million. Active data users increased by 2.6 million, lifting its data customer base to 50.3 million — helping drive a 46.4% year-on-year surge in data traffic.
“This growth was supported by our disciplined approach to gross connections and churn management, as well as continuous innovation in customer value propositions,” Toriola said.
Stabilizing Macroeconomic Environment
MTN’s recovery is unfolding against a backdrop of relatively steady macroeconomic indicators in Q1 2025. The company acknowledged that although uncertainty lingers, the naira’s performance, stabilizing at N1,537 to the U.S. dollar by the end of March, along with a recalibrated Consumer Price Index (CPI) and moderated inflation at 24.2%, provided tailwinds.
The easing of foreign exchange pressure, combined with MTN’s renegotiated lease terms with IHS Towers, helped curb operational costs. The new lease deal reportedly reduced the company’s forex exposure and capped price escalations.
“As a result, EBITDA increased by 65.9%, and the EBITDA margin expanded by 7.2 percentage points to 46.6%, which aligns with our guidance,” Toriola noted. He added that the exchange rate stability between December 2024 and Q1 2025 helped reduce forex-related losses, which had contributed significantly to the company’s losses last year.
Regulator’s Mandate
The NCC’s directive on tariff review, issued on January 20, was framed around the rising cost burden on operators. It referenced Section 108 of the Nigerian Communications Act of 2003, which allows it to intervene in pricing under extraordinary circumstances.
The Commission also made it clear that the hike came with responsibilities. Operators were given a three-month window to show tangible improvements in service quality, with expectations that higher tariffs would translate into better user experiences.
Industry players had long complained about squeezed margins due to inflation, forex volatility, and increasing energy costs, prompting fears that without price adjustments, infrastructure investment and service quality could deteriorate further.
MTN’s response so far has aligned with the NCC’s expectations — with CAPEX expansion, network capacity upgrades, and steady subscriber growth as key indicators.
Market Response
The company’s strong Q1 showing has sparked a rebound in investor confidence. MTN’s share price, which suffered a 24.24% year-to-date loss in 2024, has staged a comeback in 2025. As of April 29, 2025, the shares were trading at N240, up 20% since the beginning of the year.
The rally reflects both the earnings rebound and broader market optimism around the impact of the tariff hike and improving forex conditions. For investors and analysts who questioned the company’s trajectory amid macroeconomic shocks and regulatory uncertainties last year, Q1 2025 has provided reasons for renewed confidence.
However, while MTN Nigeria’s turnaround in Q1 is significant, much of the heavy lifting lies ahead. Analysts expect the full revenue impact of the new tariffs to play out in Q2 and beyond. Execution of the NCC’s service quality targets will also remain under scrutiny as subscribers begin to expect value for the higher prices they now pay.