DIGITAL INFRASTRUCTURES AND FINANCIAL PERFORMANCE OF LISTED TELECOMMUNICATION FIRMS IN NIGERIA.

Abstract

This study examined the relationship between digital infrastructures and financial performance of listed telecommunication companies in Nigeria. The study was motivated by the increasing dependence of telecommunication companies on network infrastructure, broadband capacity, 4G and 5G technologies, fibre connectivity, information technology systems and other digital assets for the delivery of telecommunications and digital services. The study adopted an ex-post facto research design because the investigation relied entirely on historical secondary data obtained from audited annual reports and financial statements of listed telecommunications companies. The population and sample comprised the two telecommunications companies listed on the Nigerian Exchange Group during the selected study period, namely MTN Nigeria Communications Plc and Airtel Africa Plc. The study covered 2022–2024. Digital infrastructure was operationalised using network investment intensity and digital connectivity intensity, while financial performance was measured using return on assets and EBITDA margin. Data were analysed using descriptive statistics, trend analysis and comparative analysis. The evidence from the selected annual reports indicates that sustained investment in network capacity, data infrastructure, fibre connectivity and other digital infrastructure was associated with expansion in data usage, data customers and revenue-generating digital services. However, the financial benefits were not uniform across the firms because exchange-rate depreciation, inflation, energy costs, financing costs and other macroeconomic factors affected reported profitability. MTN Nigeria, for instance, recorded strong revenue and data-user growth but reported significant losses in 2023 and 2024 because of foreign-exchange effects. Airtel Africa also experienced strong growth in data customers and network infrastructure, although its 2024 reported profit was affected by foreign-exchange losses. The study concludes that digital infrastructure remains an important strategic resource for improving the operational and financial capacity of listed telecommunications companies in Nigeria, although infrastructure investment alone does not guarantee profitability. The study recommends sustained investment in network capacity, fibre infrastructure, 4G/5G technology, digital platforms and energy-efficient infrastructure, together with effective foreign-exchange and cost-management strategies.