Group revenue increased 2.6% year on year to R11.1bn for the quarter ended 30 June 2026, while earnings before interest, tax, depreciation and amortisation (EBITDA) rose 10% to R3.08bn. The group's EBITDA margin expanded from 25.9% to 27.7%.
Data revenue remained Telkom's largest growth driver, increasing 8.8% to R6.92bn and accounting for 62.4% of total revenue. Mobile data revenue climbed 11.4%, while fibre-related data revenue grew 4%.
The group's mobile business continued to gain traction, with service revenue increasing 6.4%, driven by 9.1% growth in prepaid service revenue. Telkom's mobile subscriber base grew 6.1% to 25.3 million, while data subscribers increased 15.5% to 19.8 million.
Openserve also delivered growth, with revenue rising 5.6% and external revenue increasing 18.2%. The fibre network operator improved its connectivity rate to an industry-leading 53.9% after increasing connected homes by 16.6% to 843,563.
BCX, however, remained under pressure as revenue declined 10.9%, reflecting weaker demand for converged communications as well as IT hardware and software sales. Despite this, EBITDA increased 2.6% as the business benefited from improved margins in IT services and disciplined cost management. Cybersecurity revenue grew 36.6%, while cloud services revenue increased 11.8%.
Group chief executive Serame Taukobong said Telkom's data-led strategy and "OneTelkom" approach continued to support growth despite challenging market conditions.
"We commenced the new financial year with strong data-led growth supported by mobile and Openserve. Mobile and Openserve delivered solid revenue and EBITDA growth, while our cost discipline initiatives contributed to a solid Group EBITDA growth and margin expansion," he said.
Capital expenditure fell 19.4% to R888m during the quarter, largely due to the timing of multi-year projects at Openserve. Telkom said investment would accelerate during the remainder of the financial year, with spending expected to remain within its guidance of 12% to 15% of revenue.
The group also continued disposing of non-core property assets, selling 100 properties for R200m during the quarter, while a further 105 properties worth R264m are currently in the conveyancing process.
Looking ahead, Telkom expects its mobile service revenue to continue growing in the mid-single digits, supported by prepaid customer growth and expansion in underserved regions.
Openserve will focus on increasing wholesale fibre revenue and improving network utilisation following the launch of its own internet service provider in July, while BCX will continue its turnaround strategy under new management.
