Why the Data Boom Is Different This Time
Let’s not sugarcoat it—2023 and early 2024 were brutal for Nigerian telcos. Both MTN Nigeria and Airtel Africa took a heavy beating, mostly due to currency devaluation and inflation pressures. MTN Nigeria reported a loss of ₦137 billion in 2023, weighed down by over ₦1 trillion in foreign exchange losses. Airtel Africa followed suit, suffering a $150 million drop in net profit due to similar FX shocks.
But here’s what’s changed in 2025: the numbers are finally turning around. Not because the economy suddenly fixed itself, but because one very specific engine is firing on all cylinders—data usage.
Mobile data, particularly 4G and increasingly 5G traffic, is now driving consistent growth in revenue, margins, and investor confidence. Analysts from CSL Stockbrokers, CardinalStone, and global banks all agree: Nigeria’s data boom is not just cyclical—it’s structural. And it’s about to lift MTN and Airtel out of their earnings slump and into a new phase of sustainable profitability.
In this article, we’ll break down:
- Why mobile data is surging so aggressively
- How MTN and Airtel are capitalizing on this growth
- The investments they’re making to stay ahead
- The risks and challenges still on the table
- And what lies ahead in 2026 and beyond
The Core Driver: Mobile Data Is Surging in Nigeria
To understand why telco profits are rising, you have to look at one key figure: data usage per subscriber. MTN Nigeria reported an average of over 12GB per month per active user in Q1 2025. Airtel Africa isn’t far behind, with 60% of their customer base now using smartphones—up from 47% just two years ago.
What’s fueling this data boom?
Cheaper smartphones
Tecno, Infinix, and Itel have flooded the market with entry-level Android devices under ₦70,000. These phones are now widely used even in semi-rural areas.
Work-from-anywhere culture
Even after the pandemic, the hybrid model remains strong among SMEs and freelancers in Nigeria.
Social video explosion
TikTok, Instagram Reels, and YouTube Shorts are consuming massive amounts of bandwidth.
Digital banking and fintech
GTWorld, Opay, PalmPay, and Kuda rely on real-time data connections for app functionality, driving demand among users.
Educational and remote tools
With more young Nigerians using Coursera, YouTube Learning, and local platforms like uLesson, data consumption is going up across all demographics.
So, what’s the direct result? In Q1 2025, MTN reported a 51.5% increase in data revenue year-on-year. Airtel Africa’s data revenue also grew nearly 30% in FY 2025.
This isn’t just demand—it’s monetizable, high-margin demand.
Financial Performance: A Turnaround Fueled by Data
Let’s talk hard numbers.
MTN Nigeria
Returned to profitability in Q1 2025, posting a ₦133.7 billion profit after four consecutive quarters of losses. Data revenue up 51.5% YoY. EBITDA margins improved to over 53%, showing solid cost efficiency alongside top-line growth.
Airtel Africa
FY 2025 profit rebounded to $328 million, reversing a 52.2% drop the year before. Operating cash flow increased by 11% YoY. Data revenue accounts for more than 40% of total revenue across key markets—Nigeria, Kenya, Uganda, and Tanzania.
Both companies are now less reliant on traditional voice/SMS revenues. In fact, voice now contributes less than 30% of total revenue at Airtel and about 25% at MTN.
Also worth noting—share prices. As of May 2025, MTN Nigeria’s stock is up 27% year-to-date, and Airtel Africa has gained 18% on the London Stock Exchange. Institutional investors are regaining confidence, and most of it is tied to one driver: consistent, recurring data growth.
Network Expansion and 5G Rollout Strategy
To keep pace with this data explosion, both MTN and Airtel are pouring billions into expanding their network infrastructure. But it’s not just about coverage anymore—it’s about capacity and speed. Nigeria’s urban centres are experiencing peak-time congestion, and telcos know that without aggressive investment, they’ll lose the data revenue battle they just started to win.
MTN Nigeria’s 5G Play
MTN has deployed 5G in over 13 states as of May 2025, with a goal of covering all state capitals by Q4. It’s leveraging the 3.5GHz spectrum it acquired in 2021 to roll out high-speed, low-latency coverage in key business and tech hubs like Lagos, Abuja, Port Harcourt, and Ibadan.
The 5G offering is currently priced as a premium service, but early adoption has been strong among tech-forward businesses, banks, and content creators. MTN has also signed partnerships with OEMs to bundle 5G routers and smartphones with its data plans—targeting affluent, high-usage households.
Airtel Africa’s 4G Consolidation & 5G Entry
Airtel has been more cautious with 5G. Its priority has been increasing 4G penetration and densifying existing towers. But in late 2024, Airtel finally launched 5G in Lagos and Abuja, with a promise to roll out to 10 more cities by the end of 2025.
They’ve also spent over $150 million upgrading their fibre backbone and laying new backhaul links in Nigeria and Kenya—critical for reducing latency and improving speeds on both 4G and 5G networks.
Capital Expenditure and Tower Leasing
MTN has increased its capex to over ₦300 billion for 2025, while Airtel Africa allocated $500 million to network expansion across its 14 African markets. Both companies are leveraging tower sharing and leasing agreements to scale faster while keeping operating costs lean.
IHS Towers and American Tower Corporation remain the biggest infrastructure partners, offering multi-tenant passive infrastructure in high-growth corridors.
Challenges Ahead: Inflation, Regulation, and ARPU Pressures
Even with the current momentum, the road ahead isn’t without potholes. MTN and Airtel are still navigating a minefield of macroeconomic and regulatory risks.
Inflation and FX Headwinds
Nigeria’s inflation rate remains sticky at over 30% in 2025. This continues to affect consumers’ ability to spend on discretionary data bundles. At the same time, the Naira’s depreciation means imported network equipment, software licenses, and spectrum fees are getting more expensive by the day.
Regulatory Scrutiny
The NCC is tightening regulations around SIM card registration, pricing transparency, and quality-of-service benchmarks. MTN and Airtel have already been fined in the past for infractions, and they’re now required to submit quarterly performance data publicly.
Any misstep could trigger new sanctions or licensing reviews. Additionally, there’s increasing political noise around digital taxation, particularly in relation to value-added services delivered via the network.
ARPU Pressures
While data usage is rising, Average Revenue Per User (ARPU) is not growing as fast. This is partly because telcos offer aggressive bundle discounts to remain competitive. Airtel’s ARPU in Nigeria, for instance, remains below $3 per month, and MTN’s sits just slightly higher.
Balancing affordability with profitability will be a major test over the next 12–18 months.
Looking Forward: What 2026 Holds for MTN and Airtel
If current trends hold, both companies are poised for a stronger 2026. Analysts expect:
- Data revenues to account for over 60% of total income for MTN Nigeria by mid-2026
- More aggressive 5G rollouts targeting second-tier cities
- Continued expansion of enterprise services (IoT, cloud, edge computing)
- Entry into mobile-based digital content delivery (music, gaming, live TV)
There’s also the broader fintech play. MTN MoMo and Airtel Money are gaining scale as the cashless economy deepens. With the Central Bank of Nigeria encouraging digital wallets, telcos are positioning themselves as banks for the unbanked.
The monetization opportunity here is enormous—and more stable than traditional telecom services.
The Big Picture: Data Is the New Oil—But Execution Is Everything
Let’s be clear. The optimism around MTN and Airtel isn’t just wishful thinking. It’s grounded in clear metrics—revenue, subscriber behavior, and strategic investment. Both companies are no longer just selling airtime and calls; they’re building digital ecosystems around data.
But the real test isn’t whether data demand keeps growing—it will. The question is whether these telcos can keep delivering quality service, smart pricing, and scalable infrastructure while protecting margins in a volatile economy.
That’s the execution gap. And the companies that close it first won’t just ride the data boom—they’ll own it.
