Vodafone says UK merger is ‘ahead of plan’ as boss bets on mega multi-brand strategy
Vodafone said it is “building momentum” as the telecoms behemoth pushes further into the British market following its £4.3bn VodafoneThree deal and signs of stabilisation in Germany.
The FTSE 100 telecoms group reported better-than-expected annual revenue of €40.4bn (£35bn) for the year to March, up from €37.4bn last year. Meanwhile, pre-tax profit slipped slighty to €3.2bn.
The giant left its full-year dividend untouched at 4.5 euro cents per share, after having increased shareholder payouts earlier in the year for the first time in eight years.
Shares in Vodafone have seen a 68 per cent uptick over the last 12 months, as investors backed chief executive Margherita Della Valle’s restructuring strategy after the stock hit multi-decade lows in early 2025.
The results come days after Vodafone agreed to buy out CK Hutchison’s 49 per cent stake in VodafoneThree, giving it full ownership of Britain’s largest mobile operator by customer numbers.
Speaking on Tuesday’s media call, Della Valle said: “Our faster-than-planned progress with the integration, together with the revenue opportunities we see in managing our multi-brand estate, have driven our confidence to take full ownership of VodafoneThree earlier than expected,” she said.
Vodafone expects the merger to generate around £700m in annual savings by 2030, and pushed back against any suggestions of cutting some of its UK mobile brands despite now controlling Vodafone, Three, Voxi, Smarty and Talkmobile.
“We are very happy to manage a multi-brand estate,” Della Valle added. “These customers have chosen these different brands, and what we care most about is to make sure we have happy customers in all segments of the market.”
Germany back in growth as Vodafone claims ‘new chapter’
Germany remained one of the biggest investor focuses after regulatory changes to bundled TV contracts hammered broadband revenues over the last year.
But Vodafone said the market had now returned to top-line growth. “We are now growing service revenue in consumer broadband and in B2B,” Della Valle said, adding that “Germany is moving in the right direction.”
The chief executive said Vodafone’s German business was seeing improving customer satisfaction scores and stabilisation in its branded mobile customer base despite intense competition.
The company also used the results to signal that its multi-year restructuring programme was largely complete.
“We now have broad-based momentum across the group, following a period of significant transformation which is behind us,” Della Valle added.
UK expansion becomes central to Vodafone strategy
Britain is increasingly becoming the centrepiece of Vodafone’s growth plans following the merger with Three.
The group said VodafoneThree would benefit from network integration, procurement savings and expanded scale as it rolls out 5G infrastructure across the UK.
Vodafone expects the merger to generate around £700m in annual savings by 2030.
The company also launched a new 5G broadband product this week targeting households outside full fibre areas as it looks to compete more aggressively in the broadband market using its enlarged network footprint.
Africa again delivered the strongest growth across the group through Vodacom, supported by demand for mobile data and financial services.
The results come amid broader pressure on European telecoms companies to balance infrastructure spending with rising costs and intense competition.
Investors will now be looking ahead to Vodafone’s outlook as the group integrates VodafoneThree and continues its wider restructuring programme.