A significant observation requiring more attention than the profit figures themselves is contained in the MTN group's half-year report for the period ending in June. The company noted that the South African prepaid market remains challenging in the second quarter of 2026, particularly regarding voice service revenue trends.
This marks the fourth consecutive reporting period where MTN has reported a decline in domestic voice service revenue, with the rate of decline increasing in each subsequent period. In the third quarter of 2025, MTN South Africa's voice service revenue fell by 2.8%; in the fourth quarter, it dropped by 8%, representing a 4.2% decrease for the full year. In the first quarter of 2026, the drop reached 9.6%, and the second quarter proved difficult for the company once again.
Prepaid accounts account for about 52% of MTN South Africa's revenue. The base of prepaid subscribers decreased by 0.7% to 29.7 million during 2025, and revenue from consumer prepaid services declined by 2.3%, with the reduction reaching 3.9% in the fourth quarter. Total annual revenue grew by 2% to 44.03 billion rand; however, earnings before interest, taxes, depreciation, and amortization (Ebitda, an operating profit indicator) decreased by 10.2% to 17.67 billion rand.
The most obvious signal is the margin. MTN South Africa reported a 12.5% decrease in Ebitda in the first quarter, with a margin of 32.6%, which is 4.1 percentage points lower compared to the previous year. The company's medium-term forecast for this division is a margin in the range of 35–37%, but currently, the company is operating significantly below the lower end of its target range.
The changes were not due to Vodacom or Telkom initiating a price war. The cause was the entry of a bank into the market that does not require voice service revenue. Capitec Connect attracted 1.5 million active customers in the three months leading up to the end of February and completely abolished call charges between its own SIM cards in April. In the year leading up to February, the service processed 768 million voice minutes, which is 150% higher.
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The share price of MTN Group significantly declined on the JSE on Friday, even though the group's largest subsidiary in Nigeria demonstrated solid results for the first six months ending June 30. Furthermore, the company's business in Ghana faced litigation concerning intellectual property rights for mobile money services.
Shares dropped by 9.4%, trading at R208.30 at the end of the day. It is worth noting that a year ago, the share price was R155.26.
Karl Torola, CEO of MTN in Nigeria, stated in interim reports: 'We achieved strong results for the first half, marked by sustained commercial momentum, improved profitability, and reliable cash generation. This reflects the resilience of demand for our services, disciplined execution in the business, and a constant focus on efficiency in a complex operating environment.'
Meanwhile, on July 28, Ghanaian technology company Clydestone Ghana announced it had filed a lawsuit in the Accra High Court against MTN Ghana, MTN Group, and MobileMoney Fintech.
MTN Group denied the allegations made by the Ghanaian tech company on Friday, insisting that the accusations are unfounded and will be vigorously contested. These legal issues relate to Clydestone's alleged role in launching mobile money services in Ghana nearly two decades ago, as well as an alleged infringement of intellectual property rights for these services.
Ghana stated that its operations would not be affected by these proceedings, and neither it nor the group had created any provisions, whether contingent or otherwise, for this dispute.
Financial figures in Nigeria showed growth: the total number of subscribers increased by 8.9% to 92.2 million. Active data users grew by 9.3% to 55.7 million. Service revenue rose by 25.9% to 3.0 trillion Naira. Earnings before interest, taxes, and depreciation increased by 39.2% to 1.7 trillion Naira. Earnings per share grew by a substantial 70.6% to 33.7 Naira. An interim dividend payout of 26 Naira was declared. Free cash flow increased by 73.9% to 712.7 billion Naira.
Torola noted that although the macroeconomic backdrop remains challenging, with ongoing geopolitical tensions affecting global energy markets and inflationary trends, it was encouraging that the Naira strengthened and became relatively more stable during the reporting period. This contributed to better planning visibility and helped mitigate some price pressures.
He added: 'Commercial momentum remained strong, with net additions of 4.9 million people in the first half, bringing our subscriber base to 92.2 million, and active data users increasing by 2.5 million to 55.7 million. This indicates strengthening customer engagement, sustained demand for high-data services, and continued smartphone penetration.'
Service revenue growth exceeded mid-term forecasts, which anticipated growth of at least 20% and 10.4 percentage points above the average inflation rate in the first half. However, growth slowed in the second quarter, mainly due to the full annual extrapolation of previous price adjustments and, to a lesser extent, the temporary suspension of prepaid and data credit services, which impacted fintech segment revenue during the quarter.
Service revenue, excluding prepaid and data credit services, reached 27.3%. Torola also reported: 'Despite energy cost pressures, we continued to invest in our network while limiting operational expense growth to 11.3%. We invested 620.5 billion Naira in capital expenditure to strengthen our network and support growth opportunities.'
Revenue results across all business segments reflected strong underlying demand, disciplined commercial execution, and continued adoption of data and digital services by customers. Data revenues grew by 38.4%, supported by the increase in active data users, higher smartphone penetration, and sustained demand for high-speed connectivity. With smartphone penetration at 66.4%, data remains the largest structural growth opportunity.
Home broadband access is scaling up in a disciplined manner, focusing on improving conversion and enhancing customer value, demonstrating an attractive unit economics over time. Fintech segment revenue decreased by 7.2%, caused by the temporary suspension of prepaid and data credit services, which is a significant factor in this segment. Nevertheless, the core mobile money business showed revenue growth of approximately 132%, and the number of active wallets increased by 1.3 million to 5 million.
