MultiChoice Group is facing significant headwinds as subscriber numbers for its DStv service continue to dwindle. The pay-television broadcaster recently reported a substantial loss for the year ending 31 March 2025, accompanied by a decline of 1.2 million linear broadcasting subscribers, representing an 8% year-on-year decrease. This decline is evenly split between South Africa and the rest of Africa, highlighting the broad-based pressure across the group's entire customer base.
The company attributes these poor results to a combination of factors, including macroeconomic pressures, currency volatility, and the rise of streaming rivals like Netflix. MultiChoice also cites a particularly weak consumer spending environment in its operating markets and the increasing prevalence of piracy as contributing factors.
"The past two financial years have been a period of significant financial disruption for economies, corporates and consumers across sub-Saharan Africa due to challenging macroeconomic factors," the company stated. They also acknowledged the impact of structural industry changes in video entertainment, such as the surge in streaming services and social media, which has materially affected the overall performance of MultiChoice Group.
Over the past two years, MultiChoice has lost a staggering 2.8 million linear (broadcast) subscribers and absorbed a R10.2-billion negative impact due to the depreciation of African currencies against the US dollar. This has resulted in the company's financial performance being "stained in red ink," despite management's efforts to mitigate the impact through measures like price increases to keep pace with inflation.
Interestingly, the pending sale of the business to Groupe Canal+ has served to prop up the MultiChoice share price, with the French broadcaster's cash offer of R125/share. However, the underlying challenges facing MultiChoice remain significant, raising questions about its long-term viability in the face of increasing competition and changing consumer preferences. Some analysts suggest that MultiChoice should consider offering more targeted packages, focusing on specific sports content like soccer, rugby, cricket, and Formula 1, at more affordable prices to regain market share.
The Road Ahead
MultiChoice's future hinges on its ability to adapt to the evolving media landscape and address the challenges posed by streaming services and economic pressures. Whether the acquisition by Groupe Canal+ will provide the necessary catalyst for change remains to be seen.