IHS Nigeria revenue surges 34.1% to $359.4m in Q3’26, accounts for 73% of group revenue

Leading tower infrastructure company IHS Holdings has declared a $359.4 million revenue in Nigeria for the third quarter of quarter ending September 2026, signalling a 34.1% surge from $268 million from a year ago. 

The Nigerian market (IHS Nigeria) is the group’s biggest market, as the latest earnings contributed 73.3% of IHS Tower’s $490.5 million during the quarter.

Also read: MTN secures key approvals for IHS deal, faces regional clearance test.

According to a corporate filing with the United States Securities and Exchange Commission (SEC) containing the group’s third-quarter 2026 financial report, adjusted EBITDA increased 26.8% year-on-year (YoY) to $215.0 million, resulting in an adjusted EBITDA margin of 59.8%.

The YoY increase in the adjusted EBITDA for the third quarter reflected the increase in revenue. However, it was partially offset by an increase in cost of sales and administrative expenses included within adjusted EBITDA.

Fuel pricing impacts cost of operations 

During the quarter, there was a surge in operating costs in the Nigerian market, primarily driven by a year-on-year increase in power generation costs to $38.8 million. 

The average retail price of diesel in Nigeria currently ranges between ₦1,800 and ₦1,900 per litre, showing how companies spend heavily to power their infrastructure amid an epileptic grid supply. For tower companies and telecom operators, the cost to run their base stations 24/7, with the majority of the hours running on diesel, eats deeper into their operational expenses. 

IHS attributed the fuel price increase to “higher global power prices due to reasons including the conflict in the Middle East.” 

Keeping base stations running consumes tens of millions of litres of diesel monthly. When prices skyrocket, these multi-billion-dollar fuel bills eat into profitability, restricting the capital available for routine network upgrades, maintenance, and expansion. This builds on how telecom operators routinely spend 30% to 40% of their total operational budget just to keep base stations powered.

For IHS Nigeria, the impact of the rising fuel prices was offset by higher revenue generated through the company’s power pass-through and indexation mechanisms. 

Other sources of the increase in operational costs were a YoY surge in staff costs ($3.8 million) and tower repair and maintenance costs ($2.4 million). The increase was enhanced by the appreciation of the Naira, which is used to translate the results of the group’s Nigeria operations.

On the positive hand, the Naira appreciation to an average Naira rate of ₦1,352 to $1.00 in the third quarter of 2026 compared to an average rate of ₦1,523 to $1.00 in the third quarter of 2025 led to a 15.2% non-core increase to $40.7 million.

Tower tenants increased by 120 YoY, with growth of 497 from colocation and 1 from new sites, partially offset by 378 churn. Lease amendments also increased by 5,768 during the quarter.

IHS Holdings 

The Group reported a loss of $8.2 million for the third quarter of 2026, compared to income of $147.4 million in the third quarter of 2025. 

The 105.6% decrease was attributed to a $48.2 million increase in cost of sales and $88.4 million in administrative expense, stemming from accelerated share-based payments and long-term employee benefits payments towards the company’s proposed acquisition by MTN Group. 

However, revenue from continuing operations increased 21.4% to $490.5 million, which excludes revenue of $17.6 million for the Latam segment presented within discontinued operations,  despite a 3.5% inorganic revenue headwind as a result of the Rwanda division sale.

“We delivered a strong third-quarter performance, with revenue growth and higher Adjusted Levered Free Cash Flow (ALFCF) underpinned by operational and financial discipline and the strength of our business model,” said Sam Darwish, IHS Towers Chairman and Chief Executive Officer. 

He mentioned that the proposed $2.2 billion acquisition of IHS Towers by MTN continued to advance during the quarter and currently expects the transaction to close in 2026, subject to the remaining closing conditions.

In its 9M 2026 financial statement, MTN said it awaits regional regulatory approvals from the Economic Community of West African States (ECOWAS) and the Economic and Monetary Community of Central Africa (CEMAC). 

In addition to regional organisations, the South African Competition Tribunal is also reviewing the deal’s impact on competition in South Africa.