The Arab Internet and Communications Services Company (Solutions), a leader in enabling digital transformation in the Kingdom of Saudi Arabia, announced its annual financial results for 2025, which showed a decline in net profit of 5.9% to reach 1.5 billion Saudi riyals, compared to a net profit of 1.6 billion riyals in the previous year 2024.
Financial performance details and reasons for profit decline
According to data published on the Saudi Stock Exchange (Tadawul), the company attributed this decline primarily to a decrease in gross profit of SAR 105 million. This occurred despite revenue growth of SAR 666 million, which was offset by a larger increase in the cost of revenues, rising by SAR 771 million, thus putting pressure on profit margins. Net profit was also affected by a SAR 93 million increase in zakat and tax expenses, mainly due to the reversal of zakat provisions from previous years following the final settlement with the Zakat, Tax and Customs Authority during 2024.
Conversely, operating expenses saw a positive decrease of SAR 86 million, driven by a SAR 97 million reduction in selling and distribution expenses, despite a slight increase of SAR 11 million in general and administrative expenses. It is worth noting that the 2024 results included non-recurring items that impacted the comparison, such as the reversal of zakat provisions amounting to SAR 104 million and exceptional income from non-operating activities of SAR 68 million. According to the company, excluding these non-recurring items, net profit would have grown by approximately 6%.
General context and position of “Solutions” in the Saudi market
Solutions, the IT services arm of stc Group, is a pivotal player in the Kingdom’s telecommunications and information technology sector. Since its inception, the company has played a vital role in supporting the national digital transformation agenda stemming from Saudi Vision 2030. The company offers a comprehensive suite of solutions and services to both the public and private sectors, including managed services, cloud computing, cybersecurity, and the Internet of Things (IoT), making it a strategic partner in many of the Kingdom’s mega-projects.
Significance and expected impact: Cash distributions reflecting confidence
Despite the challenges posed by rising costs, the company's revenue growth reflects continued strong demand for digital transformation services in the local and regional markets. To bolster investor confidence, Solutions' Board of Directors has recommended a cash dividend of SAR 953 million for the fiscal year 2025. The dividend per share is SAR 8, based on 119 million shares eligible for dividends. Shareholders of record at the close of trading on the second trading day following the company's Annual General Meeting, the date of which will be announced later, will be entitled to the dividend. This recommendation reflects the company's financial strength and management's confidence in its future cash flows and its ability to sustain growth.
