MultiChoice recently announced its annual results for the year ended on March 31, 2024, showing a substantial increase in revenue from its streaming video-on-demand (SVOD) service, Showmax.
The revenue generated by Showmax for the financial year was reported to be US$53 million, marking a 22% increase from the previous year.
According to MultiChoice, the fiscal year 2024 was a significant period for Showmax, as it officially concluded its partnership with Comcast in April 2023 and then relaunched the service in February 2024.
The revenue for Showmax witnessed impressive growth, reaching R1 billion in the mentioned period. Despite this growth, MultiChoice noted that Showmax’s trading losses increased to US$141 million, which was below the expected range of US$162 million to US$217 million.
MultiChoice attributed this increase in trading losses to operational expenditure and depreciation shifting, particularly due to the launch of Showmax towards the end of the period.
The company highlighted that Showmax achieved substantial growth following the relaunch, compensating for the termination of its higher-average revenue per user (ARPU) Showmax Pro service. Showmax demonstrated record single-month growth in March 2024, with a 16% increase in the paying subscriber base from the migrated base at relaunch to year-end.
Additionally, revenue from Showmax subscription fees experienced a 1% year-on-year growth.
One notable achievement was that 100% of subscribers migrated to the new platform and subscriptions, with over 88% of the migrated subscribers remaining active and continuing to pay for the service.
Phahle stated that the aim is to generate revenue of more than US$1 billion after five years, with a trading profit breakeven target in full-year 2027 and to achieve EBITDA margins of 25% and free cash flow margins of around 20% at scale.
Phahle emphasised that many industry players viewed Africa as the final frontier for SVOD growth and outlined Showmax’s goal to become the leading streaming platform in Africa with Showmax 2.0. She also expressed confidence that Showmax would turn a profit by the end of its 2027 financial year.
