MultiChoice’s secret Showmax numbers

MultiChoice has elected not to release subscriber numbers for Showmax after Netflix announced that it would no longer report its figures from the first quarter of 2025.

Netflix announced the change in its April financial report for the first quarter of 2024, where it also beat Wall Street expectations to grow its global subscriber base to 270 million.

MultiChoice chief financial officer Tim Jacobs told MyBroadband in June 2023 that they would report the platform’s subscriber numbers after completing the migration to Showmax 2.0.

Jacobs said they didn’t want to create noise in the marketplace by reporting subscriber figures, only to potentially lose a substantial number during the migration.

MultiChoice Group CEO Calvo Mawela told MyBroadband they didn’t arrive at the decision to withhold Showmax’s subscriber numbers lightly.

“It’s something that we have debated at length within the management team,” MultiChoice Group CEO Calvo Mawela told MyBroadband.

Mawela said they would be putting themselves at a competitive disadvantage by giving out subscriber numbers while their competitors are beginning to withhold them.

He explained that players like Netflix would no longer report their subscriber numbers because they were managing their platform for profit and cash generation.

This suggests the focus will be on reporting revenue, profit, and free cash flow.

Netflix reported $9.37 billion (R172 billion) in revenue, net income of $2.33 billion (R43 billion), and free cash flow of $2.13 billion (R39 billion).

MultiChoice reported its first separate full-year financials for Showmax during its 2024 annual results.

The streaming service achieved R1 billion in revenue, up 22% from the previous year.

Showmax’s trading loss also more than doubled from R1.2 billion to R2.6 billion.

However, MultiChoice said that this was below its expected range of R3 billion to R4 billion.

MultiChoice noted that some operational expenses and depreciation were shifted into the next financial year. It warned that this would result in incremental trading losses.

Although MultiChoice did not release official subscriber numbers for Showmax, it is estimated to be between 700,000 and 1 million.

The company revealed that Showmax delivered record single-month growth in March 2024.

It also reported that discontinuing its Showmax Pro package and the shutdown of Showmax outside Africa for the diaspora had a minimal impact on its subscriber base.

MultiChoice did not report Showmax’s net income.

Tim Jacobs, MultiChoice CFO

“The 2024 financial year represented a pivotal year for Showmax,” MultiChoice said.

Showmax had been rebuilt on NBCUniversal’s Peacock platform after the Comcast-owned mass media conglomerate bought a 30% stake in the company last year.

The company has highlighted that the new platform is 4K/HDR and Dolby Atmos ready and was customised for local requirements, such as support for low-bandwidth devices and data-saving options and functionality.

MultiChoice relaunched Showmax on the new platform in January and began migrating customers onto “Showmax 2.0” from 12 February 2024.

Mawela emphasised Showmax’s achievement of migrating almost 100% of the eligible customer base to the new platform, with 88% reactivating their accounts.

“The estimate when we started said around 50%, if we are lucky, in the first few months, but this team has delivered against all odds,” said Mawela.

“I’m really very proud of the team, and I compliment them every day for the great work.”

In addition to its Showmax 2.0 migration milestone, MultiChoice also reported that its streaming service launched across 44 markets in sub-Saharan Africa.

It initially focused its marketing efforts on South Africa and Nigeria, with markets like Kenya and Ethiopia to follow in its next financial year.

MultiChoice has told investors that Showmax aims to achieve trading profit break-even in its 2027 financial year.

The pay-TV operator is also targeting revenue of $1 billion (R18 billion) for Showmax by its 2028 financial year-end.

To generate this revenue, Showmax will need to have around 16 million active subscribers who pay an average of R99 per month.

This is no easy task. Digital TV Research predicted that the total number of video streaming subscribers in Africa will only be 15.6 million users by 2028.

MultiChoice disagrees with this forecast. It said it expects video streaming uptake to undergo exponential growth in Africa.

MultiChoice is so optimistic that it is aiming to increase its total subscriber base, including Showmax and DStv subscribers, to 50 million users in 2028.

For Showmax alone, the company has indicated that it aims to have 25 million subscribers on the platform by 2028.

Based on this forecast, Showmax would need to grow its subscriber base by an average of around 100% a year until 2028.