Cell C’s Wholesale and MVNO Strategy Drives Profitability and Growth
Cell C’s Wholesale and MVNO Strategy Drives Profitability and Growth
Cell C has achieved profitability for the year ending May 31, 2025, a significant milestone driven by its strategic focus on wholesale partnerships and mobile virtual network operators (MVNOs).
The company’s annual results, released by owner Blue Label Telecoms, show strong growth across key revenue lines, improved operating margins, and a substantial increase in profit before tax.
Despite still being technically insolvent, the mobile operator’s performance highlights the success of its transformation strategy, which centers on a capital-light model and strategic partnerships.
Wholesale and MVNOs Lead the Charge
The company’s wholesale division, which includes its thriving MVNO partnerships, was a key driver of its success.
This segment delivered another year of double-digit growth, with revenue increasing by 13% year-on-year.
This growth boosted the division’s share of total service revenue from 12% to 13%. Cell C noted a steady increase in MVNO customers on its platform, reinforcing its leadership in this market segment.
The wholesale business provides a stable, predictable source of income that complements the company’s consumer operations.
A standout success in this area is the bank MVNO Capitec Connect, which Cell C highlighted as the most successful MVNO on its platform.
Broader Financial Health
Cell C’s focus on its wholesale and MVNO business contributed to its overall financial turnaround. The company saw a remarkable surge in its financials for the 2024/25 financial year, including:
- Net revenue growth of 4% to R11.14 billion.
- Service revenue growth of 6% to R11.97 billion.
- Prepaid broadband revenue surged by 18%, reflecting a 31% increase in mobile data traffic.
- Profit before tax skyrocketed by more than 200%, reaching R264 million compared to a loss of R22.4 million in the prior year.
This financial recovery was achieved despite a highly competitive market, demonstrating the effectiveness of its strategic, asset-light approach and its ability to drive efficiency through partnerships.
A Focus on High-Value Customers and Future Growth
In addition to its wholesale strategy, Cell C also focused on optimizing its customer base to attract and retain higher-yield subscribers, keeping its total customer count stable at around 7.6 million. While the average revenue per user (ARPU) saw a slight decrease, this was in the context of a massive 20% increase in data traffic, showing that customers are using more data for streaming and other digital services.
Looking ahead, Cell C’s priorities for the 2025/26 financial year include continuing to accelerate MVNO and wholesale growth. The company also plans to re-integrate its postpaid subscriber base and scale its enterprise and fibre businesses, all while maintaining the financial discipline that helped restore its profitability.
“This year’s results prove that Cell C is back in profit and with momentum,” said Cell C CEO Jorge Mendes. “We’ve reshaped our business, secured growth in wholesale, broadband, and postpaid, and strengthened our brand and customer experience.”
