MTN CEO: Relying On Accumulated 20-Year Nigeria Profit To Stay Afloat

MTN Nigeria, the largest telecom operator in the country, has emphasized the urgent need for the telecommunications industry to regain profitability to sustain its operations.

The CEO of MTN, Karl Toriola, shared this message on Monday during a visit to MTN’s facilities by Fellows of the Media Innovation Programme in Ibeju-Lekki, Lagos.

Toriola, who oversees about 78 million subscribers, highlighted that the sector has been experiencing significant losses and immediate action is required to change this situation. He noted that MTN has been relying on profits accumulated over the past two decades to stay afloat, which he described as unsustainable. He stated, “We must return the industry to profitability,” stressing the importance of reform.

Earlier this year, telecom operators called for a tariff increase—the first in 11 years—to tackle rising operational costs and enhance service quality. Without such adjustments, they warned that financial stability and service standards would continue to worsen. Toriola pointed out that the sector is under pressure from rising operational costs, particularly due to increasing diesel prices needed to power base stations. He warned, “There should be no delusion; if the tariff doesn’t go up, we will shut down,” highlighting the urgent need for tariff adjustments to align with current economic conditions.

Toriola also mentioned that MTN, once a top corporate taxpayer in Nigeria, has seen its tax contributions decline due to these financial struggles. Reflecting on the first quarter of the year, MTN and Airtel have taken a cautious approach to capital spending for 2024. Meanwhile, the other mobile operators, 9mobile and Globacom, are not publicly listed.

In 2024, MTN Nigeria reported a massive loss of N519.1 billion in the first half of the year, mainly due to foreign exchange losses from the devaluation of the naira and high inflation rates. Additionally, Toriola warned that the company might stop providing Unstructured Supplementary Service Data (USSD) banking services because of the N250 billion debt owed by Nigerian banks. The mobile network operator is seeking regulatory approval to end support for USSD services used for banking unless the debt is settled and tariffs are adjusted to reflect economic realities.

However, Toriola expressed hope that the new Governor of the Central Bank of Nigeria, Yemi Cardoso, and the Executive Vice Chairman of the Nigerian Communications Commission, Dr. Aminu Maida, would step in to help resolve the ongoing financial crisis. He concluded by stressing the vital role of the telecom industry in supporting Nigeria’s economy and urged the government and regulators to act swiftly to avoid serious consequences from inaction.

Send Us A Press Statement Advertise With Us Contact

 And For More Nigerian News Visit GWG.NG