Telkom’s strong financial performance in its 2025 financial year has continued into the new year, with the partially state-owned telecommunications group on Tuesday reporting good growth in its mobile and fibre businesses.
In a trading update, Telkom Group CEO Serame Taukobong said the company’s data-led strategy “continues to be the competitive advantage enabling us to sustain our momentum into FY2026 and the increased contribution by mobile data and fibre-based services to total revenue is consistent with the assumptions supporting our medium-term objectives”.
Telkom said group revenue in the first quarter — ended 30 June 2025 — increased by a modest 1.1% year on year. However, Telkom Consumer’s mobile revenue leapt by 7.8% and wholesale division Openserve’s fibre data revenue is up 11.3%.
Mobile data subscribers jumped by 27.5% to 17.2 million and home connected with fibre rose by 17.5%, with a connectivity attachment rate — the number of homes connected where fibre in available — at a solid 51.1%.
Meanwhile, group Ebitda margin – Ebitda is a measure of operating profit — rose by 1.4 percentage points to 25.9%.
“We are optimising selling channels, continuously improving customer experience on our networks, and providing customer-centric value with affordable and flexible offerings…,” said Taukobong. “This resulted in improved profitability for the group, with Ebitda growing by a solid 6.5%. I am confident this momentum will continue throughout FY2026.”
‘Outpacing’
Data revenue contribution as a percentage of total group revenue “advanced in line with our data-led strategy and now represents almost 60% of group revenue”.
Telkom Consumer’s mobile service revenue increased by 7.8%, “gaining value market share as it continued outpacing South African market growth rates”.
The mobile business grew total external revenue by 7.2% to R6.1-billion, driven by mobile service revenue growth of 7.8%.
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“Mobile data revenue expansion was due to a continued surge in mobile data subscribers and data traffic. Telkom’s share of acquisitions in the underserviced regions improved by 5.4%, driven by regional activations and Mo’Town, which is our customer value management initiative for area-specific customer value propositions,” the company said.
The total subscriber base grew by 12.3% to 23.8 million, with a blended average revenue per user (Arpu) of R75. Prepaid subscribers rose 14% to 20.8 million at R58 Arpu, with growth in lower-Arpu, non-metro regions driving down prepaid Arpu.
The post-paid subscriber base increased marginally by 1.7% to three million, with Arpu of R187.
Mobile data subscribers expanded by 27.5% to 17.2 million and now comprises 72.1% of the total subscriber base.
This led to mobile data traffic growing by 15.9% to 480 petabytes, Telkom said. On the fibre side, the subscriber base increased by 6.6%, supported by a 6.3% growth in Arpu.
However, the good performance in mobile and fibre was tempered by a poor performance at IT services business BCX, where revenue declined by 8.3%. Accelerated declines in voice revenue hit this business hard, although this was offset to a degree by gains in business fibre solutions.
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“Aligned with our focus on delivering results, a specialised team is in place to continue with its work to effect a faster BCX turnaround,” Taukobong said.
The troubles at BCX may have contributed to a poor market reaction to Tuesday’s trading update, with the shares losing ground throughout much of the day. They were last quoted at R54.37, down 7.7% on the session. However, the shares had climbed by 159% over the past 12 months (up to Monday’s closing price on the JSE). — (c) 2025 NewsCentral Media
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