Safaricom has set its sights on achieving breakeven for its loss-making Ethiopian operations by the end of the financial year 2026.
The telco anticipates hitting profitability as it targets an active customer base of 15-20 million and a network footprint of over 4,000 sites across Ethiopia.
Currently, after a year of operations, Safaricom Ethiopia has racked up 4.4 million 90-day active customers on its network. It has also registered 4.5 million M-Pesa users who completed 31.5 million transactions worth KES 24.5 billion (56 billion birr) in total value during that period.
On the infrastructure front, Safaricom Ethiopia has rolled out services through 2,806 network sites, supported by a network of 62,700 active merchants.
In its debut year ending March 2024, start-up costs outweighed 6.2 percent revenue growth of KES 5.4 billion (12.3 billion birr), leaving a KES 42.09 billion (96.2 billion birr) annual loss.
CEO Peter Ndegwa highlighted customer and network gains and said, "We have doubled our active customer base...and built a world class network."
CFO Dilip Pal said sizable losses were expected given Ethiopia's greenfield market entry.
"We expect Ethiopia to be a significant growth contributor by 2025," said Safaricom in a statement.
Safaricom Ethiopia is well capitalized, with over three billion dollars in funding, including 1.6 billion dollars in equity, 134 million dollars in local currency debt, 100 million dollars in IFC debt financing, and 301 million dollars in deferred vendor payments.
In Kenya, M-Pesa drove over 40 percent of service revenue, underscoring its importance amid Safaricom’s regional expansion ambitions.
