Telkom SA reports 16.3% earnings growth, driven by mobile and fibre services

Telkom SA, the third largest South African telecoms group, delivered a sturdy 16.3% increase in earnings as it continued to leverage the advantage of its extensive fibre footprint to drive service and data growth.

“A remarkable example of such competitiveness is that our Mobile business delivered market-leading service revenue growth for the 11th consecutive quarter to June 2025, since its establishment 15 years ago,” said the CEO, Serame Taukobong.

For the six months to September 30, Telkom SA’s service revenue was up 10.3%. Group revenue increased 3.4% to R22.1 billion, driven by robust mobile data revenue growth (10.3%) and fibre-related data revenue (12.3%).

Group data revenue was up 7.9%, contributing 59.1% to total revenue. Group earnings before interest, tax, depreciation, and amortisation (EBITDA) increased by 7.4% to R6.02bn, due to revenue growth and cost initiatives.

Free cash flow stood at R724 million. Headline earnings per share came to 305.6 cents. Basic earnings per share increased 12.7% to 325.7 cents.

“Our investments in the period resulted in mobile sites surpassing 8 000, with population coverage improving to 85%. Furthermore, we increased the number of homes connected by 18.1%, improving our connectivity rate to 52%,” he said.

Taukobong said the country's economic growth was expected to be subdued this year. There was also tougher competition in both mobile and fibre, coupled with muted corporate ICT spending.

“These conditions underscore the importance of leveraging the advantages of our extensive fibre footprint and sharpening our competitiveness through the OneTelkom approach,” said Taukobong.

The adjusted half-year results for the 2025 year excluded the impact of a R160m restructuring cost and the Telkom Retirement Fund derecognition loss of R618m in continuing operations.

Taukobong said the solid performance for the first half of the 2026 financial year represented the sustained momentum of what was built in the previous financial year.

Mobile service revenue grew by 7.9%, and there was a 26.7% increase in the mobile data subscriber base to 18.5 million, while the mobile EBITDA margin expanded.

At subsidiary Openserve, the country’s largest wholesale telecommunications infrastructure provider, overall revenue increased by 2.7%, fibre-related data revenue grew by 10.1%, while the EBITDA margin stood at 33.3%.

At BCX, Telkom’s IT services and digital transformation arm, fibre-related data revenue increased by 13.8%, cloud services revenue was 10.4%, while the EBITDA margin improved to 9.9%.

Taukobong said that looking ahead to the remainder of the financial year, they aimed to continue delivering quality earnings and growth ,by achieving targets and medium-term guidance.

“Our data-led strategy will continue to act as a catalyst for growth as we strengthen our unique position as the backbone of South Africa's digital future,” he said.

In the past six months, mobile data traffic increased by 16.8% to 993 petabytes. Fibre broadband lines were up 11.5% to 568 217. Carrier services increased by 9.3% to 21 760. The active fibre connectivity rate was up 2.3 percentage points to 52%.

Some R4.83bn in interest-bearing debt was settled in the period, resulting in finance charges decreasing by 27.3%. Some R208m was received in proceeds from the transfer of 18 non-core properties. Twelve properties worth R71m were in the conveyancing process and were expected to transfer by year-end.

Telkom’s share price nudged up 1.34% to R51.55, a price that has grown steadily since R31.34 a year before.

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