On Wednesday, the South African Vodacom Group reported that its first-quarter revenue for the 2025 fiscal year, which ends on June 30, 2025, increased by 10.6 percent to $2.2 billion (R40 billion).
The company’s service revenue exceeded its medium-term goals by 11.4 percent to $1.8 billion (R32.3 billion), fueled by notable growth in financial services and strong performances in South Africa and Egypt.
Substantial contributions from Vodacom’s key markets fuel growth
Substantial contributions from its main markets drove the mobile communications company’s expansion.
A rebounding prepaid market helped South Africa’s service revenue increase 1.8 percent to R15.3 billion.
Data traffic increased by 31.3 percent, according to the report, indicating a rise in demand for digital services.
Financial and digital services, in addition to mobile services, accounted for R2.6 billion, or 17 percent of South Africa’s service revenue.
According to Shameel Joosub, Vodacom Group CEO, “South Africa’s results were boosted by improved prepaid performance and price adjustments that delivered greater value to customers.”
With a 43.7 percent increase in service revenue in local currency, Egypt stood out as a particularly prosperous country.
Vodafone Cash increased by 47.9% to 8.7 million
Vodafone Cash users increased by 47.9 percent to reach 8.7 million, driving an 87 percent increase in the region’s financial services revenue. With 47.4 million customers, Egypt now contributes 21.9 percent of Vodacom’s overall service revenue, a 6.1 percent increase.
Revenue from Vodacom’s financial services division increased by 8.7 percent to R3.3 billion, representing a 16.8 percent normalised growth.
The previous year, the company handled $400.2 billion in mobile money transactions, securing its place as the biggest mobile money platform in Africa in terms of transaction value.
M-Pesa and VodaPay super-app enhance financial and digital inclusion
M-Pesa in foreign markets and the VodaPay super-app in South Africa continue to promote digital and financial inclusion. Tanzania and Egypt have been particularly fond of these platforms.
The business’s international operations, which include Tanzania, the Democratic Republic of the Congo (DRC), Mozambique, and Lesotho, reported a 2.3 percent increase in service revenue to R7.4 billion, with normalised growth of 5.7 percent. Tanzania outperformed DRC with exceptional local currency results, while the latter produced robust single-digit growth in US dollars.
Challenges in Mozambique
However, Mozambique faced challenges due to post-election tensions. Data revenue in these markets grew by 15.5 percent due to a 29.6 percent increase in data traffic and a 16.4 million increase in smartphone users.
Vodacom, meanwhile, spent R1.9 billion on network infrastructure in the quarter and intends to spend R11.5 billion for the entire year to improve customer service and increase coverage.
“Our investments in new spectrum and 4G sites are driving data growth and improving connectivity,” Joosub said.
Since October 2024, Mozambique has experienced post-election instability that has hindered operations and impacted regional performance.
Vodacom’s acquisition of Maziv
As a crucial step in closing the digital divide, the company also emphasised its proposed purchase of a portion of South African fibre operator Maziv, which is presently being examined by the Competition Tribunal.
Vodacom encountered difficulties with foreign exchange headwinds despite the impressive results, especially due to the strengthening South African rand.
Although reported revenue figures were affected by these currency fluctuations, normalised growth metrics demonstrated the company’s underlying resilience.
Joosub was upbeat about the company’s future course: “Our strategy to diversify revenue by product and geography is bearing fruit. We remain on track to meet our medium-term financial targets.”
Vodacom’s Vision 2030 strategy
The company’s Vision 2030 strategy calls for a 30 percent contribution from non-mobile services by 2030 and intends to accelerate service revenue growth to double digits by 2028.
Vodacom continues to support its growth goals by focusing on digital inclusion through programs like expanding coverage in rural areas and providing affordable smartphone financing.
The company wants to connect an additional 100 million Africans to the digital economy, and it currently serves over 210 million customers, including Safaricom.
Vodacom Group’s Q1 2025 results show that it can successfully navigate a difficult economic environment while generating robust growth.
The business is in a strong position to maintain its momentum thanks to its emphasis on financial services, data-driven products, and calculated investments.
Vodacom continues to be a key player in expanding financial and digital inclusion throughout Africa as it works toward its Vision 2030 objectives.
