MTN is spending less on the best network in South Africa - Ralph Mupita — MTN Group CEO Ralph Mupita

MTN Group cut capital spending on its South African network by 17.1% in the six months to June, to R2.64-billion excluding leases, in a half that saw its prepaid base shrink by about 1.5 million customers and its total subscriber base fall 0.7% year on year to 39.5 million.

The reduction holds on both measures MTN reports. On the IFRS 16 basis used in its segment tables, South African capital expenditure fell 13.5% to R3.3-billion from R3.81-billion.

Group capital expenditure was R19.7-billion excluding leases, down 5% as reported and marginally higher in constant currency. What changed was the allocation. MTN invested R7.34-billion ex-leases in its Nigerian network in the half, 2.8 times the South African figure. Nigerian capital intensity was 20.6%, against 16.6% for the group.

MTN does not publish a capital intensity figure for South Africa. On the basis it uses for the group and for Nigeria — capital expenditure excluding leases as a share of revenue — South African intensity was 10.6% in the half, down from 12.6% a year earlier. That is about half the Nigerian level and below the 15-18% range MTN targets at group level.

Group CEO Ralph Mupita told a media call on Monday the South African reduction was a matter of timing. Capital deployment is seasonal, he said, and MTN expects full-year South African spending of around R7-billion, weighted to the second half. “There is no concern about undercapitalising on South Africa,” he said.

MTN did not specify whether that R7-billion is measured on the same basis as its segment disclosure, which put South African capital expenditure at R8.38-billion for 2025.

Composition has shifted

“We have had network leadership there for a long time, and we want to defend it,” he said of South Africa. He used similar language about Nigeria, where he said the higher intensity was because MTN continues to defend and expand its network leadership.

The results document supports the phasing argument, though not for South Africa specifically. MTN told shareholders that group cash generation is weighted towards the second half, reflecting the phasing of collections, capital expenditure and the timing of dividend receipts.

Read: MTN sheds prepaid customers as voice decline accelerates

The commitments disclosure points the same way. MTN entered 2026 with R42.2-billion of authorised capital commitments for property, plant, equipment and software. It spent R24-billion in the first half on an IFRS 16 basis and had R18.3-billion of authorised commitments remaining at the end of June.

The composition has shifted. Of what remains, R4.7-billion is contracted and R13.6-billion is not. A year earlier the position was close to reversed, with R14.5-billion contracted and R3.1-billion not. Less of the remaining spend is locked into supplier agreements than at the same point last year.

Vodacom's South African capital intensity was 12.8% in the year to March, against MTN's 10.6% in the half to June — Vodacom’s South African capital intensity was 12.8% in the year to March, against MTN’s 10.6% in the half to June

None of that is South African. MTN gives no capital expenditure guidance for its South African business anywhere in the results, and the outlook section for the unit covers prepaid recovery, commercial initiatives and cost reduction without mentioning the network. The one country-level forward statement MTN does commit to writing is that capital intensity at MTN Nigeria will moderate in the second half.

Vodacom invested R11.88-billion in South Africa in the year to March 2026, up 2.8% from R11.55-billion, and has guided to around R12-billion for the year to March 2027. The money went to scaling its 5G footprint and improving capacity and resilience, it said, describing the objective as remaining South Africa’s most reliable network.

Vodacom’s figure is owned capital expenditure and excludes spectrum, licences and capitalised right-of-use assets. It added a further R7.4-billion of South African right-of-use assets during the year, up from R4.1-billion. On the same measure applied to MTN, Vodacom’s South African capital intensity was 12.8%.

It is holding that investment through a soft year at home. Vodacom’s South African service revenue grew 2.1% to R64.4-billion and its earnings before interest, tax, depreciation and amortisation fell 1.7% to R33-billion.

Meanwhile, Telkom’s group capital expenditure rose 10.4% to R6.43-billion in the year to March, at 14.5% capital intensity. Almost the entire increase went to back-office IT, which more than tripled to R952-million. Mobile capital expenditure fell 3.5% to R2.69-billion and spending on network rehabilitation and sustainment was cut 92.2% to R26-million.

A network catch-up is coming. Authorised capital expenditure not yet contracted jumped to R8.54-billion from R3.91-billion, which Telkom attributed to a higher budget for network infrastructure.

Best network

For now, the operator spending least on its network is growing fastest in the segment where the other two are losing ground. Telkom’s mobile prepaid revenue rose 10.3% in the year to March. Vodacom’s South African prepaid revenue fell 2.1% over the same period. MTN’s fell 3.3% in the six months to June.

In Opensignal’s 2025 South African report, built on billions of handset measurements, MTN won 11 of 15 awards, including all four overall experience awards. Ookla puts MTN’s median mobile download speed at 74.76Mbit/s, the fastest in the country, and Icasa records national 4G population coverage of 99.5%.

Read: The trap that stops MTN and Vodacom eating Cell C’s lunch

The lead is not recent. Ookla gave MTN a speed score of 97.32 for the second half of 2024, well ahead of Vodacom and Cell C on median download speed and with the best network consistency in the market at 92.8%, though Vodacom took the lead on 5G speeds.

What the testing does not explain is why customers are leaving. DataEQ’s operational customer experience score puts MTN at -17%, against Rain’s +16%, the highest in the industry – close to an inversion of the network rankings.

MTN’s losses are concentrated in prepaid, where the competition is on price rather than speed. Capitec Connect, which owns no network and runs on Cell C’s wholesale capacity, scrapped charges for calls between its own Sim cards in April and carried 768 million voice minutes in the year to February, up 150%. MTN’s South African voice revenue fell 10.2% in the half.