South African fintech company clawing its way back to profit

Lesaka Technologies is on track to return to profitability in its 2026 financial year, with the first two quarters showing positive momentum.

This comes as the fintech giant is in the process of acquiring Bank Zero for over R1 billion, with the aim of creating a full-service banking giant.

On Thursday, 5 February, Lesaka released a trading update for the second quarter of its 2026 financial year, which ended 31 December 2025.

In the second quarter, Lesaka saw its revenue decline by 3% to R3.06 billion, while its net revenue shot up by 16% to R1.6 billion.

Lesaka also reported a 265% jump in operating income to R37.04 million, and a 46% increase in group adjusted EBITDA to R304.45 million.

The fintech giant further recorded a swing to profitability, measured by net income, compared to the second quarter of its 2025 financial year.

Lesaka’s net income swung from a loss of R589.47 million in Q2 2025 to positive income of R60.83 million.

In addition, the company recorded basic earnings per share of 0.68 cents, a notable improvement from the loss per share of 7.14 cents it recorded in the comparative period.

The company said this signifies that it has achieved the mid-point of its profitability guidance, with the company now on track to reach its full-year targets for 2026. These targets include –

• Net revenue of between R6.4 billion and R6.9 billion
• Group adjusted EBITDA of between R1.25 billion and R1.45 billion
• Net income attributable to Lesaka is to be positive
• Adjusted earnings per share of at least R4.60, implying a year-on-year growth of greater than 100%

Notably, the firm explained that this guidance excludes the impact of its Bank Zero acquisition, which remains subject to regulatory approvals and other customary closing conditions.

A return to profitability will mark a milestone for the company, which suffered severe losses between 2019 and 2021 when it still operated as Net1. 

As Net1, the company experienced high profitability, driven by a lucrative social grant contract with the South African Social Security Agency.

However, when this contract ended, the company suffered severe losses and divested from non-core assets.

In the years since, the company has been implementing a rebranding and turnaround strategy, which involved shifting towards a merchant and consumer fintech business, now operating under the name Lesaka.

After stabilising revenue and turning EBITDA losses into profits in 2025, Lesaka is now on track to record positive net income for the first time in years.