Streaming service Showmax reports $141M in trading losses

Pan-African streaming service Showmax, owned by South Africa's MultiChoice Group, has reported trading losses of 2.6 billion South African rand (US$141 million) for the year ended March 31, 2024.

The streaming platform was revamped in February 2024, with the promise of a variety of local and international shows including Showmax Originals, a new international content slate, and a football streaming plan.

MultiChoice said the new-look Showmax was showing encouraging early traction and delivered record single-month growth in March 2024, with the paying subscriber base growing 16% from the migrated base at relaunch to year-end.

"The commencement of the Showmax investment cycle reduced the group's trading profit by R1.4 billion [$76 million]," MultiChoice said in its annual results statement.

It also spent R1.7 billion ($92 million) on 'platform technology advances' related to MultiChoice's partnership with US-based Comcast as part of the Showmax revamp.

Multichoice said Showmax's trading losses of R2.6 billion (US$141 million) were actually below its R3 billion-R4 billion ($163 million-$217 million) guided range it had prepared for.

Showmax was revamped in February 2024, with new Showmax Originals, an new international content slate and a football streaming plan. (Source: Image by freepik).

Back in June 2023, MultiChoice said it planned to invest heavily to grow Showmax with aspirations to make it the leading streaming service in Africa.

Showmax is taking on streaming giants like Netflix, Amazon Prime and Disney+ that are expanding their reach across the continent.

Subscribers dwindle under economic pressure

Apart from streaming, Multichoice also runs satellite television services DStv and GOtv which broadcast across Africa.

The Multichoice Group saw a 9% decline in active subscribers, with a 5% drop in South African subscribers and a 13% decline in 'the Rest of Africa' business "as mass-market customers in countries like Nigeria had to prioritise basic necessities over entertainment" it said.

Multichoice Group is facing struggles in Nigeria where its active DStv subscribers in the country declined by 18% over the past year.

Earlier this month Nigeria's Competition and Consumer Protection Tribunal fined the pay-TV operator, 150 million naira (US$95,550) for disobeying an order not to hike prices of its DStv and GOtv packages. It also ordered Multichoice to give Nigerians a one-month free subscription on DStv and GOtv.

The group is also in the midst of a takeover bid by French pay-TV company Canal+, which is a major shareholder looking to buy all the shares in Multichoice it does not already own.

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*Top image source: Image by freepik.

— Paula Gilbert, Editor, Connecting Africa