Vodacom Tanzania has reported strong operational and financial momentum in the first half of 2025/26, underpinned by double-digit revenue growth, expanding cash flows, and accelerating performance in its core digital and mobile money businesses.
However, the telecom reported a marginal dip in net profit linked to deliberate, short-term investment decisions.
In the six months to September 2025, the telecom’s revenue grew by 24% to TZS 905.3 billion (UGX 1.31 trillion), lifting operating profit by 27.8%, and swung free cash flow into positive territory at TZS 24.9 billion (UGX 35.9 billion).
While net profit after tax edged down by 1.2% to TZS 41.7 billion (UGX 60.1 billion), the decline was driven by accelerated depreciation and temporary costs arising from a $100 million network modernisation programme.
Excluding these factors, underlying net profit surged by 136.1% to TZS 99.6 billion (UGX 143.6 billion), revealing the true strength of the business.
Beyond the headline figures, the 2025/26 half-year results offer a clear lens through which to assess Philip Besiimire’s three-year tenure as Managing Director, one defined by growth, capital discipline, and consistent shareholder returns.
Investing through earnings for long-term advantage
The 2025/26 first-half numbers reflect a conscious strategic trade-off. Vodacom Tanzania is in the midst of a two-year technology refresh aimed at replacing legacy network equipment, expanding 4G and 5G capacity, and strengthening its digital platforms.
The programme triggered accelerated depreciation of TZS 60.6 billion (UGX 87.4 billion), temporarily compressing reported profits.
Operationally, however, the business moved decisively forward. Service revenue increased by 23.1% to TZS 883.9 billion (UGX 1.27 trillion), M-Pesa revenue grew by 28.1%, and mobile data revenue rose by 31.2%.
Net cash from operating activities rose to TZS 384.9 billion (UGX 554.9 billion), reinforcing the company’s capacity to fund expansion internally.
The telecom also upgraded its medium-term guidance, now targeting early-double-digit service revenue growth, signalling that current investment is expected to translate into sustained earnings expansion.
Stabilising the base
Besiimire assumed leadership in October 2022, inheriting a business emerging from pandemic-era disruption and regulatory uncertainty. The 2023 full year, therefore, marked a period of stabilisation rather than aggressive expansion.
The focus was on restoring momentum in customer acquisition, prioritising network quality, and aligning capital allocation toward scalable growth drivers such as mobile data adoption, smartphone penetration, and the M-Pesa ecosystem. While growth in that first year was measured, it laid the operational foundation for what followed.
Strategy meets execution
2024 was Besiimire’s first full year in charge, and the inflection point became visible.
Vodacom Tanzania grew its customer base by 16.9% to 19.6 million, strengthened its market leadership to 30.5%, and delivered service revenue growth of 19.4% to TZS 1.3 trillion (UGX 1.87 trillion). Mobile data and M-Pesa led the charge, with revenues expanding strongly year-on-year.
Profitability improved in tandem. Profit after tax rose by 19.9% to TZS 53.4 billion (UGX 77.0 billion), enabling dividends equivalent to 50% of post-tax earnings even as the company invested heavily to expand coverage and capacity.
M-Pesa crossed 10 million active customers during the period, confirming its evolution from a transaction platform into a central pillar of Tanzania’s digital financial infrastructure.
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2025 marked the year when scale translated into earnings power. Service revenue accelerated to around TZS 1.5 trillion (UGX 2.16 trillion), while profit after tax jumped nearly 70% to TZS 90.5 billion (UGX 130.5 billion).
This divergence between revenue and profit growth underscored a critical shift: Vodacom Tanzania had entered a phase of operating leverage, where incremental revenue increasingly flowed to the bottom line.
The revenue mix continued to improve structurally. M-Pesa and mobile data dominated growth, while advanced services, digital, fixed, enterprise, and IoT played a growing role. Dividend distributions rose accordingly, reinforcing Vodacom’s positioning as both a growth and income stock.
From telecom to digital platform
Across the three years, Vodacom Tanzania has undergone a fundamental transformation. Voice revenue, once the backbone of telecoms, has steadily ceded ground to a diversified digital platform combining connectivity, payments, credit, savings, enterprise solutions, and data-driven services.
By the 2025/2026 half-year, Vodacom had facilitated access to over TZS 1.6 trillion (UGX 2.31 trillion) in digital credit to nearly five million individuals and SMEs.
The expansion of services such as savings, insurance, and wealth offerings has helped deepen customer engagement and embed the business more firmly into everyday economic activity, materially enhancing the quality and resilience of earnings.
Capital discipline in a capital-intensive sector
Telecoms rewards disciplined capital allocation, and Besiimire’s tenure has been marked by restraint as much as ambition. Between 2023 and 2025/26 first half, Vodacom expanded 4G coverage beyond 72%, rolled out 363 5G sites, acquired strategic spectrum assets, and maintained capital expenditure within a 13–16% of revenue range. The network modernization programme is budgeted at approximately TZS 260 billion (UGX 374.8 billion).
The 2025/26 confirmed a crucial milestone: expansion is now being funded from internal cash generation, with free cash flow turning positive even during a period of elevated investment.
That strengthens the balance sheet and enhances strategic flexibility at a time when telecoms across the region are being forced to choose between growth and financial resilience.
Dividends alongside growth
For shareholders, the three-year scorecard is defined not only by expansion but by returns. Vodacom Tanzania has consistently paid dividends while reinvesting heavily, growing its total equity to TZS 912.9 billion (approximately UGX 1.32 trillion) by the end of the first half of 2026.
This balance, between reinvestment and reward, has underpinned investor confidence and differentiated the company from peers pursuing growth without yield.
A clear three-year verdict
Viewed through the lens of the first half of 2025/26, Philip Besiimire’s tenure tells a coherent story. He has overseen a transition from stabilisation to execution to monetisation; strengthened Vodacom Tanzania’s growth engines; modernised infrastructure; diversified revenues; and restored profit momentum, without sacrificing financial discipline or shareholder returns.
The first half of 2025/26 results are not a pause in performance. They are the logical outcome of a strategy that prioritised long-term value over short-term optics.
Three years on, the scorecard reads clearly: growth delivered, discipline maintained, dividends sustained, and a business structurally positioned for the next phase of Tanzania’s digital economy.
