Airtel Africa Earnings Call Signals Resilient Momentum

Airtel Africa Plc ((GB:AAF)) has held its Q3 earnings call. Read on for the main highlights of the call.

Confidence dominated Airtel Africa’s earnings call as management underscored broad-based strength: double-digit constant-currency revenue and EBITDA growth, margin gains, and accelerating mobile money and network investments, while framing competitive, regulatory, and voice-decline headwinds as manageable.

Strong Revenue and EBITDA Growth

Reported revenue jumped 28.3% year-on-year and EBITDA nearly 36%, translating to 24.6% and 31% growth, respectively, in constant currency; the widening spread highlights Airtel Africa’s ability to convert top-line momentum into profit despite FX volatility.

Quarter 3 Revenue Acceleration

Third-quarter sales accelerated to $1.69 billion, marking 24.7% constant-currency growth (+33% reported) versus the prior quarter, a sign that product mix, pricing, and subscriber additions are reinforcing each other.

Robust Mobile Services Performance

Mobile services revenues climbed 23.6% in constant currency as the customer base hit 179.4 million, data users grew 15% to 81.8 million, smartphone penetration reached 48.1%, and traffic surged 47%; data ARPU rose 16.2%, driving roughly 35.5% data revenue growth.

Airtel Money Scale and Traction

Airtel Money surpassed 52 million users with annualized transaction value above $210 billion (up 36%), producing 28% revenue growth and EBITDA margins north of 50%, underscoring the platform’s expanding monetization potential.

Margin Expansion and Profitability

Group EBITDA margin widened to 49.6% led by Nigeria at 57.8% and Francophone Africa at 44.3%; constant-currency EBITDA rose 31% (40.8% in reported terms), reflecting efficiency gains and disciplined cost control.

Earnings and EPS Improvement

Underlying EPS for nine months increased 57% to $0.116 while basic EPS tripled to $0.131, translating operational momentum directly into shareholder returns.

CapEx Investment and Network Expansion

Capital spending surpassed $603 million through nine months (+30% YoY) with guidance of $875–$900 million for the year, funding roughly 2,500 new sites and 81,500 kilometers of fiber to enhance coverage and capacity.

Balance Sheet and Finance Improvements

Lease-adjusted leverage fell to 0.7x from 1.1x, the effective interest rate dropped 200 basis points, and lower financing costs enabled accelerated debt repayment and stronger free cash flow.

Strategic Innovation and Partnership Progress

Management spotlighted initiatives like AI-powered spam alerts and a Starlink Direct-to-Cell partnership (pending regulatory approvals), plus ongoing preparatory work for an Airtel Money IPO targeted for H1 2026.

Competitive Intensity in East Africa

Heated rivalry in East Africa is temporarily pressuring growth, yet customer additions (~9.5%) and smartphone adoption (~19%) remain healthy as Airtel counters with targeted offers and network upgrades.

Regulatory-Related Service Disruptions

Market-wide, security-driven internet outages dented quarterly momentum in East Africa, but management stressed the disruptions were temporary and already subsiding.

Voice Revenue Declines

Legacy voice usage continued to erode, especially in Francophone markets, but the company is leaning on OTT partnerships and data-led bundles to mitigate the structural shift.

Concentration and Penetration Limits for Airtel Money

Only about 52 million of 179 million GSM customers actively use Airtel Money, leaving ample cross-sell headroom that management aims to unlock via agent expansion and bundled offerings.

Potential Nigeria Growth Lapping Risk

With 40–50% of last year’s Nigerian growth tied to tariff hikes, management cautioned that anniversary effects could moderate reported gains in coming quarters.

Regulatory Approvals and Execution Risk for Starlink Offerings

The Starlink Direct-to-Cell rollout hinges on regulatory clearances in multiple markets, creating timing uncertainty despite the strategic promise of ubiquitous coverage.

Limited Disclosure on Revenue Breakdowns

Executives withheld granular Airtel Money mix data and tower contract specifics, citing commercial sensitivity, leaving some investors wanting more transparency on margin durability.

Potential Cost Headwinds

Local fuel price spikes and other operating cost pressures were flagged as potential margin drags, though management expects macro improvement to offset much of the impact.

Forward Guidance and Outlook

Management reaffirmed full-year CapEx of $875–$900 million, confirmed Airtel Money IPO plans for H1 2026, highlighted leverage comfort at ~0.7x lease-adjusted, and cited Nigerian tax reform enabling a 1.5% margin lift from Q4, while reiterating its stance against providing revenue guidance and emphasizing ongoing network expansion.

Airtel Africa’s earnings call painted a picture of resilient growth, rising profitability, and disciplined investment, even as regulation, competition, and legacy voice trends add friction; investors are likely to focus on whether execution on mobile money, Nigeria’s normalization, and infrastructure build-outs sustain the positive trajectory.