Telkom SA revenue grows to $2.74 billion on consumer demand strength

Telkom SA SOC Limited reported higher revenue and improved earnings for the year ended March 31, 2026, as steady demand for data services and tighter cost controls helped offset uneven performance across parts of its business.

The Johannesburg-based telecom group, led by chief executive Serame Taukobong, posted revenue of R44.48 billion ($2.74 billion), up from R43.88 billion ($2.68 billion) a year earlier. The increase was supported by growth in its consumer and OpenServe divisions, while the business-to-business unit BCX continued to face softer conditions in some areas.

Data revenue up 7.6 percent

Data revenue increased 7.6 percent to R26.6 billion ($1.64 billion), accounting for nearly 60 percent of total revenue. That shift in mix helped cushion softer enterprise spending in parts of the portfolio and reinforced the group’s focus on broadband and fiber expansion.

Operating performance improved during the period. Adjusted EBITDA rose 5.8 percent to R12.48 billion ($770.1 million), with margins widening to 28.1 percent. The company attributed the improvement to lower operating costs, which declined 1.1 percent, and better efficiency across network operations and support functions. Profit from continuing operations increased 5.9 percent to R3.55 billion ($219.1 million).

Earnings per share also strengthened. Headline earnings per share from continuing operations climbed 21.5 percent to R7.08, while basic earnings per share rose 5.5 percent to R7.195. Management said the improvement reflected both operational gains and a more stable cost base compared with the prior year.

Telkom’s mobile data subscribers near 20 million

The consumer business remained the largest contributor to growth. Mobile service revenue increased 6.8 percent, supported by a 10.3 percent rise in prepaid services. Mobile data subscribers grew 31.1 percent to nearly 20 million, reflecting continued uptake of smartphones and data bundles. The segment’s EBITDA margin improved to 29 percent.

Openserve, the group’s wholesale infrastructure unit, recorded its first full-year revenue growth in nine years, up 2.3 percent. Fiber-related data revenue increased 8.2 percent, supported by continued rollout of fiber-to-the-home connections. The unit’s fiber-to-the-home penetration rate reached 53.1 percent, while its EBITDA margin improved to 33.5 percent.

BCX remained under pressure. Revenue in the information technology division was broadly unchanged at R6.72 billion ($414.7 million). However, the unit saw stronger demand in selected areas, with cybersecurity revenue rising 21.1 percent and hardware and software sales up 5.6 percent. The segment’s EBITDA margin held at 9.4 percent.

Free cash flow rises 10.4 percent

Free cash flow increased 10.4 percent to R3.07 billion ($189.5 million), supported by tighter capital spending and improved working capital management. Net debt to EBITDA improved slightly to 0.5 times from 0.6 times a year earlier, reflecting a stronger balance sheet position.

The board declared a final ordinary dividend of R2.7 per share, up 65.7 percent, under a payout range of 40 percent to 60 percent of free cash flow. Management said the higher payout reflects improved cash generation and a more stable operating environment across core segments.