A reading of Vodacom Group’s 2026 financial results shows its home market is barely growing in customer terms, that what top-line growth there is leans heavily on price adjustments in February rather than volume growth, and profitability would have looked materially worse without a one-off accounting gain from the Maziv fibre transaction.
Service revenue in South Africa rose 2.1% to R64.4-billion in the year to 31 March 2026, well below inflation. Ebitda – a measure of operating profit – fell 1.7% to R33-billion, hit by what Vodacom described as a one-off settlement cost in the first half.
The cost was not disclosed, but the same announcement separately confirmed that the long-running “please call me” dispute with former Vodacom employee Nkosana Makate had been concluded out of court on 4 November 2025.
Reported operating profit was effectively flat at R20.5-billion (down 0.2%). On a normalised basis – stripping out the impact of the Maziv transaction, which Vodacom said included a R1.1-billion book gain on the disposal of fibre assets in December 2025 – operating profit fell 7.1%. The normalised figure still carries the impact of the one-off settlement charge raised in the first half; Vodacom did not disclose what the underlying decline would have been with that cost stripped out as well.
The customer numbers underline how thin the underlying growth has become:
- Vodacom’s South African contract base grew by just 28 000 customers in the year, ending at seven million – growth of 0.4%.
- Prepaid customers, the bulk of the South African base at 39.1 million, also grew 0.4%.
- Data customers – those generating billable mobile data traffic each month – actually declined 4.3% to 26.5 million, which Vodacom attributed to seasonal offers driving consolidation onto primary Sims.
Prepaid mobile customer revenue fell 2.1% for the year, although the decline moderated through the second half and to 1.6% in the fourth quarter. Mobile contract customer revenue grew 3.5%, with average revenue per user up 3.3% – almost entirely a function of price rather than upgrades or net additions.
In the fourth quarter, contract revenue growth lifted to 4.1% on the back of the February 2026 price adjustments. That is Vodacom’s main lever in a saturated market, but a difficult one to maximise in a highly competitive industry.
Data traffic was up 32.1% and average consumption per smart device rose 24.6% to 6.3GB/month, even as voice revenue continued to decline. Monetising data traffic at a pace that grows the top line ahead of inflation is proving elusive.
Structural drag
The Maziv deal also had a meaningful effect on the South African operating result. Vodacom South Africa contributed fibre assets and cash worth R12.6-billion to the new fibre vehicle in December 2025 in exchange for a 30% stake. The fair value uplift on the contributed assets produced a R1.1-billion gain that flowed through the income statement.
The structural drag on the local mobile business – competitive intensity, weak consumer spending and prepaid pressure – was masked at a reported level by the Maziv accounting gain and a price-led contract uplift in the final quarter.
Read: Vodacom’s fintech machine tops 100 million customers
“Beyond mobile” services were the real growth story in the local business. The category – which includes fixed lines (fibre), financial services, digital services and the internet of things – grew 6.8% to R12-billion, contributing 18.7% of South African service revenue. Vodacom Business service revenue grew 6.2% to R17.9-billion, with cloud, hosting and security up 27.1%. Financial services revenue grew 8.1% to R3.7-billion, helped by insurance and merchant services.
These segments are the growth story now, not consumer mobile. Vodacom is guiding for capital spending in South Africa of R12-billion in the 2027 financial year, broadly flat on the R11.9-billion invested in the year just ended.
So, what is the South African business now? From a growth perspective, the answer increasingly appears to be an enterprise and fintech business.
Asked how important the enterprise segment will become in the years ahead, Joosub told TechCentral in an interview on Monday that the growth in Vodacom Business is coming from fixed services, cloud hosting and security, and the internet of things (IoT).
“Overall fixed revenue is up 8% for both consumer and enterprise, but also cloud, hosting and security, which is up a healthy 27%, and IoT is up about 10%,” he said. “The diversification of what I call ‘beyond core services’ is playing a big role in growing the enterprise revenue.”
Read: Voice going the way of SMS, says Vodacom CEO
The segment will become increasingly important as AI and cloud adoption accelerate, Joosub said. “We want to be well positioned, on one hand, to provide connectivity – whether that’s mobile, fixed or satellite – and on the other to be able to provide the extra services that enterprises need, both from small businesses to large businesses.”
On whether Vodacom would bolster its enterprise capabilities through acquisitions, Joosub said the group remained open to bolt-on deals but was wary of scale-driven deals that failed to add profit. – (c) 2026 NewsCentral Media
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