Rising Revenues, Operational Efficiency Boost Profits of Saudi Telecom Companies

Telecom towers (AFP)
Telecom towers (AFP)
TT

Rising Revenues, Operational Efficiency Boost Profits of Saudi Telecom Companies

Telecom towers (AFP)
Telecom towers (AFP)

Saudi Arabia’s listed telecom companies saw a 69% surge in net profits by the end of 2024, reaching SAR 28.39 billion ($7.57 billion), compared to SAR 16.79 billion ($4.5 billion) in 2023. This growth was driven by higher revenues, an expanding customer base, and improved operational efficiency.

The sector includes four companies: stc (Saudi Telecom Company), Mobily (Etihad Etisalat), Zain Saudi Arabia (Mobile Telecommunications Company Saudi Arabia), and GO (Etihad Atheeb Telecom). The first three follow a December fiscal year-end, while GO’s fiscal year ends in March.

According to financial disclosures on Saudi Arabia’s stock exchange (Tadawul), stc accounted for 87% of the total sector profits in 2024. The company’s net profit soared to SAR24.7 billion, up 85.7% from SAR13.3 billion in 2023. stc attributed this growth to higher revenues and gains from discontinued operations.

Mobily ranked second in terms of profitability, with a net profit of SAR3.11 billion, reflecting a 39.2% increase from SAR2.23 billion in 2023. The company credited this growth to higher revenues across all segments, an expanding customer base, improved operational efficiency, and lower financing and tax expenses.

In contrast, Zain Saudi Arabia saw a 52.96% decline in net profit, falling to SAR596 million from SAR1.27 billion in 2023. The company attributed this drop to higher operational expenses and increased provisions for expected credit losses. Despite this, Zain fulfilled all its financial obligations for 2024, amounting to SAR1.8 billion.

Mohammed Hamdi Omar, CEO of G-World Research, told Asharq Al-Awsat that the telecom sector’s financial performance highlights its strength and growth potential, particularly for industry leader stc.

“The 85.7% surge in stc’s profits reflects its success in diversifying revenue streams. This is evident in its entry into the financial sector with its digital wallet (now STC Bank), investments in IoT, entertainment, consultancy, and IT outsourcing, as well as enhanced operational efficiency,” Omar explained.

Commenting on Zain’s profit decline, Omar noted that the company needs to reassess its operational and financial strategies, especially considering rising operational costs and credit losses. However, he highlighted that Zain’s ability to meet all financial obligations is a positive indicator of its financial management.

Financial markets analyst Tariq Al-Ateeq told Asharq Al-Awsat that Saudi telecom firms have strong potential for continued profit growth. He emphasized that focusing on enterprise services, keeping pace with technological advancements, and diversifying revenue sources will be key to sustaining growth.



Saudi Arabia Boosts Food Security

An agricultural farm in Saudi Arabia (SPA)
An agricultural farm in Saudi Arabia (SPA)
TT

Saudi Arabia Boosts Food Security

An agricultural farm in Saudi Arabia (SPA)
An agricultural farm in Saudi Arabia (SPA)

Saudi Arabia is accelerating efforts to strengthen food security, a strategic objective rooted in the Kingdom’s founding and shaped by its desert geography and limited water resources.

As part of its Vision 2030, the Kingdom has placed food security among its top priorities, implementing a national strategy to boost local production and promote long-term agricultural sustainability.

The agricultural sector’s contribution to GDP rose to SAR114 billion ($30.4 billion) in 2024, up from SAR109 billion ($29 billion) the previous year, according to the latest Vision 2030 annual report.

Government support, particularly through the Agricultural Development Fund, has fueled the sector’s growth. Agricultural loans increased by 54% between 2018 and 2024, reaching SAR5 billion ($1.33 billion).

Saudi Arabia has achieved higher self-sufficiency rates across several key products. Domestic production in 2024 included 2.95 million tons of fruit, 3.38 million tons of vegetables, 1.83 million tons of grains, 399,000 tons of eggs, 2.7 million tons of milk, 274,000 tons of red meat, 1.15 million tons of poultry, 217,000 tons of fish, and 8,500 tons of honey.

Aquaculture has seen significant growth, with fish production rising from 40,000 tons in 2016 to over 246,000 tons in 2024, driven by investments in sustainable technologies and marine projects. Saudi Arabia is positioning itself as an emerging regional hub for aquaculture.

The Kingdom’s progress reflects its long-term commitment to food security, supported by initiatives to enhance supply chains, stimulate private sector investment, and advance research and innovation in modern farming technologies. Authorities say the achievements so far signal Saudi Arabia’s ability to continue advancing toward self-sufficiency in a more resilient and sustainable agricultural environment.