Telecommunications

Axe hanging over Vodacom as profits surge

Jonathan Hoyle

 ·10 Nov 2026

Vodacom’s revenue jumped by 25.6% in its latest interim period, supported by its acquisition of Safaricom, but legal hurdles still remain in the deal.

The mobile service provider saw its revenue increase from R81.6 billion to R102.5 billion in the six months ended 30 September 2026.

The largest contributor to this was service revenue, which amounted to R85.1 billion in the latest interim period.

The company’s operating profit surged by nearly 157% to R52 billion, up from R20.2 billion in the prior comparable period.

The strong financial results also translated into investor gains, with earnings per share rising by over 200% to 1,779 cents.

While earnings per share was strong, Headline Earnings Per Share (HEPS) did not carry the same momentum, increasing by 25.7% year-on-year.

One major aid for Vodacom in the six months ended 30 September was the acquisition of Safaricom, Kenya’s largest mobile network operator.

Vodacom increased its stake in the Kenyan telecoms giant earlier this year, from 35% to 55%, giving it majority control over the company.

Vodacom CEO Shameel Joosub said the acquisition was “a defining milestone in Vodacom’s evolution”, which would help boost the company’s earnings.

“The Safaricom transaction further enhances our earnings profile, broadens our exposure to attractive high-growth markets and materially increases the contribution from financial services and digital businesses,” he said.

Joosub also commented on the company’s customer growth, saying it reinforces the belief that the company has room to continue growing.

“The momentum we are seeing across customer growth, smartphone adoption, financial services and beyond mobile services reinforces our confidence in the significant opportunity ahead,” he said.

In the six months ended 30 September 2026, Vodacom increased its client base to over 250 million, with the group’s goal of reaching 275 million clients by 2030.

Vodacom interim financial results snapshot

Legal troubles

While the Safaricom deal was previously approved, it has faced several legal challenges, including a decision by the Kenyan High Court declaring it void.

After the sale was initially approved, it was brought to the Kenyan High Court, which ruled on 15 September 2026 that the acquisition should be reversed.

Following the decision, Vodacom applied for leave to appeal, which was granted, and the court opted to fast-track the appeal.

In the interim, the Appeals Court said the prevailing status quo should be maintained, meaning Vodacom would continue to own its majority stake in Safaricom.

“On 13 October 2026, the Court of Appeal in Nairobi decided to fast-track the appeal and ordered that the prevailing status quo be maintained pending its determination,” Vodacom said.

“As a result, Vodacom remains the registered holder of the Safaricom shares acquired from the Government of Kenya (GoK) and the related purchase consideration will be preserved pending the hearing of the appeal.”

The Safaricom acquisition was costly for Vodacom, with approximately R153.4 billion in total invested capital.

The transaction contributed to an increase in the group’s net debt, which rose by R78.8 billion year-on-year to R135.6 billion.

“Group reported net debt increased by R78.8 billion year-on-year to R135.6 billion as a result of the Safaricom transaction,” Vodacom said.

“The acquisition was funded through R35 billion of debt, R9 billion of which was financed through preference shares.”