Vodafone Sees Growth Despite Challenges
Vodafone has reported a 5.5% increase in service revenue in Q1, exceeding expectations. Despite facing challenges in its German and UK markets, the company remains optimistic about its outlook.
Positive Results and Outlook
In the rest of Europe and Africa, Vodafone has seen positive results with good business sales. In Germany, the company’s stable performance was supported by improved wholesale and business sales, although impacted by bulk TV deals. In the UK, while experiencing slower growth, Vodafone saw good results in fixed sales amidst challenges in business and consumer contracts due to the Three merger.
Financial Performance
In the first quarter of the financial year, Vodafone’s group service revenue reached €7.86 billion, surpassing expectations. Despite a slight decline in Germany and the UK, the markets together contributed significantly to the total revenue. The company’s outlook remains steady with an upward revision in the full-year profit guidance.
Operational Developments
In Germany, a focus on wholesale and business sales drove improvements, while challenges arose from the end of bulk TV contracts affecting fixed-line services. The company is also restructuring its workforce in Germany. In the UK, Vodafone’s mobile service revenue grew, and it is investing in 5G infrastructure through the VodafoneThree venture, aiming to become the biggest mobile network operator in the UK.
Regional Performance
Outside Germany and the UK, Turkey showed significant revenue growth, and Europe reported positive enterprise sales but declining consumer sales. The company also noted growth in Africa, particularly in Egypt and Vodacom operations.
CEO’s Comment
CEO Margherita Della Valle emphasized the company’s positive trajectory in Germany and strong growth in emerging markets. The completion of the Three merger in the UK positions Vodafone well for continued growth in Europe and Africa.
