What is the story about?
What's Happening?
Safaricom, Kenya's largest enterprise, is celebrating its 25th anniversary with plans to expand its growth model into Ethiopia. Despite financial challenges in Ethiopia, including currency reform impacts, Safaricom has invested $2.5 billion into the market and aims to break even by 2027. The company has achieved significant milestones, such as surpassing $3 billion in revenue and reaching 50 million customers in Kenya. Safaricom's mobile network covers 95% of the population, and its M-Pesa platform has 36 million monthly users. The company is also focusing on increasing 4G and 5G device adoption and expanding broadband connectivity.
Why It's Important?
Safaricom's expansion into Ethiopia represents a strategic move to tap into Africa's newest liberalized telecom market, offering vast growth potential with a population of 125 million. The company's success in Kenya provides a strong foundation for its Ethiopian venture, which could drive double-digit growth in the future. Safaricom's efforts to increase device affordability and broadband access are crucial for enhancing digital connectivity in the region. The expansion could also lead to increased competition and innovation in Ethiopia's telecom sector, benefiting consumers and the economy.
What's Next?
Safaricom plans to continue its expansion in Ethiopia, targeting 15 million subscribers by the end of the year and nearly 50 million within a decade. The company aims to make all its sites 5G-ready by 2029, enhancing its network capabilities. As Ethiopia stabilizes, Safaricom expects to achieve positive EBIT by 2027, supported by government incentives and a level playing field with Ethio Telecom. Stakeholders will likely monitor the company's progress and adjust strategies to maximize growth opportunities.
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