Vodafone Reports 3.9% Q1 Revenue Growth, Shares Up Over 4%

Vodafone shares rose 4% after Q1 2025-26 results showed a 3.9% increase in total revenue to €9.4bn, with service revenue up 5.3% to €7.9bn. Adjusted EBITDAaL grew 4.9% to €2.7bn, and the company confirmed its FY targets of €11.3bn to €11.6bn for adjusted EBITDAaL and €2.4bn to €2.6bn for adjusted FCF.

Vodafone Group PLC (LSE: VOD) reported a 3.9% increase in total revenue to €9.4 billion for the first quarter of the 2025-26 fiscal year, according to its latest financial update. This growth was driven by a 5.3% increase in service revenue to €7.9 billion. The company's adjusted EBITDAaL (Earnings Before Interest, Taxes, Depreciation, Amortization, and Leases) rose by 4.9% to €2.7 billion. Vodafone has maintained its full-year profit and cash flow guidance, with adjusted EBITDAaL expected to be between €11.3 billion and €11.6 billion, and adjusted free cash flow projected to be between €2.4 billion and €2.6 billion.

The increase in revenue was largely attributed to the successful completion of the merger with Three UK. The UK segment saw a 14.5% rise in total revenue to €1.9 billion, primarily due to the inclusion of Three UK's results post-merger. However, the company also reported a 3.2% decline in service revenue in Germany due to regulatory changes affecting TV contracts, although this was an improvement compared to the previous quarter.

In other regions, Vodafone reported strong service revenue growth, particularly in Africa and Türkiye. Africa saw a 13.8% increase in service revenue to €1.555 billion, while Türkiye experienced a 22.1% rise to €629 million. The company also noted that it added 200,000 mobile contract customers in Türkiye, including migrations from prepaid users.

Vodafone's shares opened 0.5% lower at 82.76p after the release of the Q1 update, reflecting a muted market response to the broadly steady trading performance. The company has returned €2.5 billion to shareholders through buybacks, with more to follow.

References:
[1] https://www.business-standard.com/companies/quarterly-results/vodafone-idea-ltd-quarterly-results-23040
[2] https://telecomlead.com/5g/vodafone-q1-fy26-revenue-rises-3-9-capex-focused-on-5g-expansion-121879
[3] https://www.marketscreener.com/news/vodafone-sticks-to-guidance-after-revenue-rises-german-segment-improves-update-ce7c5cd3dd81fe20
[4] https://www.proactiveinvestors.co.uk/companies/news/1075355/vodafone-s-surprise-free-update-receives-muted-market-response-1075355.html