Vodafone Group Plc Q3 total revenue increased by 5.0% to €9.8 billion

Vodafone Group Plc (LON:VOD) has announced its Q3 FY25 Trading Update.

Good Group performance, with portfolio transformation completing

“Group service revenue growth accelerated to 5.2% in the third quarter. This was driven by a step-up in the UK and strong performance in Türkiye and Africa, whilst Germany is impacted by the TV law change. We are continuing to invest in the turnaround of our German business and we are starting to see improving customer trends, although conditions have become more challenging in the mobile market. During the quarter, we completed the sale of Italy for €8 billion and received regulatory approval for Vodafone’s merger with Three in the UK. When the UK merger completes in the next few months, we will have fully executed Vodafone’s reshaping for growth. We are on track to grow in line with our full year guidance for this year, which we reiterate today, and are looking forward to a stronger Vodafone in the years ahead.” Margherita Della Valle, Group Chief Executive

–    Group total revenue: Increased by 5.0% to €9.8 billion in Q3 with good organic service revenue growth partially offset by adverse foreign exchange movements.

–    Group service revenue: Grew by 5.6% in Q3 to €7.9 billion and on an organic basis increased 5.2% (Q2: 4.2%), driven by broad-based growth, excluding Germany. The acceleration in quarterly trends was driven by the UK and Africa. 

–      Germany: Declined by 6.4% in Q3 (Q2: -6.2%), primarily due to the impact of the TV law change. Excluding this impact, service revenue declined by 2.6% in Q3 (Q2: -2.4%), largely due to lower broadband service revenue.

–      UK: Organic service revenue growth accelerated to 3.3% in Q3 (Q2: 1.2%), as the significant investments we have made to our customer experience are driving growth in Consumer.

–      Other Europe & Türkiye: In Q3, organic service revenue growth in Other Europe remained stable at 2.6% and service revenue growth in Türkiye remained strong, increasing by 53.1% in euro terms, excluding the hyperinflationary adjustment.

–      Africa: Organic service revenue growth improved to 11.6% in Q3 (Q2: 9.7%), supported by an acceleration in South Africa and above-inflation growth in Egypt, driven by demand for data and price actions.

–      Business: Our growth momentum continued, with organic service revenue growth of 4.3% in Q3 (Q2: 4.0%) driven by double-digit growth in digital services, including cloud & security.

–    Group Adjusted EBITDAaL: Increased by 2.2% on an organic basis to €2.8 billion, as service revenue growth in most markets and lower energy costs in Europe more than offset the impact of the TV law change in Germany. The Adjusted EBITDAaL margin of 28.8% was 0.5 percentage points lower year-on-year on an organic basis. On a year-to-date basis, Adjusted EBITDAaL increased by 3.2% on an organic basis to €8.2 billion. Operating profit decreased by 18.4% to €1.0 billion (see basis of preparation on page 7).

–    Share buybacks: Third €0.5 billion tranche completed 22 January 2025, with 1.8 billion shares repurchased for €1.5 billion since May 2024. Final €0.5 billion tranche from the initial €2 billion buyback programme commencing today.

–    Group FY25 guidance reiterated: On track to deliver Group Adjusted EBITDAaL of c.€11 billion and Group Adjusted free cash flow of at least €2.4 billion.

–    UK merger: In December 2024, the UK’s Competition and Markets Authority approved the combination of Vodafone and Three in the UK. We expect the merger to formally complete in the next few months.

–    Vodafone Italy disposal: The sale of Vodafone Italy to Swisscom AG for €8 billion in cash completed on 31 December 2024. Proceeds have been used to reduce net debt and the Board will target to return up to €2.0 billion via share buybacks once the current programme has completed.

A webcast Q&A session will be held at 10:00 GMT on 4 February 2025. The webcast and supporting information can be accessed at investors.vodafone.com