Telecommunications companies listed on the Saudi stock market (Tadawul) achieved a 43% growth in their quarterly profits during Q3 of 2023, reaching SAR 5.7 billion ($1.52 billion).
This surge is attributed to the increasing number of subscriptions, expansion into digital banking, service diversification, especially during the Hajj season, and the companies leveraging the growth in customer base during these seasons.
By the end of the third quarter of 2023, the profitability of Saudi telecommunications companies increased by 1.71 compared to the same quarter of the previous year, during which they recorded profits of around SAR 4 billion, according to the financial results announced by three companies in the financial market.
The sector comprises four companies, three of which conclude their fiscal year in December: Saudi Telecom Company (STC), Mobily, and Zain Saudi Arabia.
The profits of Saudi telecommunications companies jumped by 57.43% during Q3 compared to the previous quarter of 2023, amounting to about SAR 3.63 billion.
Additionally, they recorded a growth in revenues during the third quarter by 10.3%, reaching SAR 24.73 billion, compared to SAR 22.4 billion in the same quarter of the previous year in 2022.
During the first nine months of 2023, Saudi telecommunications companies registered a significant increase in profits, with a growth rate of 283%, totaling SAR 2.71 billion.
This resulted in a net profit increase to SAR 13.47 billion, compared to SAR 10.76 billion in the same period of 2022.
Mohammed Makni, a financial and investment expert and the CEO of Ithmar, told Asharq Al-Awsat that telecommunications companies are a fundamental pillar of the Saudi economy.
According to Makni, the sector receives significant attention and effort to promote investment and support it for the growth of non-oil output.
He added that in 2020, the telecommunications market in Saudi Arabia reached $36 billion, contributing to a 5.1% growth in the local GDP.
Makni further explained that one of the main reasons for the high and increased profitability of telecommunications companies during the third quarter is the 38.5% profit jump by STC, as well as its 9.1% profit growth during the past nine months compared to the same period in 2022.
