Vodafone Group Plc (LON:VOD) has announced its Q1 FY27 trading update.
Vodafone: a strong start to our new growth chapter
“In May, we said Vodafone is entering a new chapter – one focused on stronger, multi-year growth.
We have made a good start to this financial year, with broad-based growth across all of our segments and organic service revenue increasing by 5.2%. Germany saw improved retail revenues, the UK continues to show strong commercial momentum, and our Africa operations continue to grow double digit on an organic basis. This revenue growth – coupled with the new phase of our multi-year cost initiatives announced in May – has resulted in organic Adjusted EBITDAaL increasing by 6.2%.
Following the completion of the Safaricom transaction, we are updating our guidance range to reflect the contribution from Kenya and Ethiopia. And after our good start to the year, we are expecting to deliver the upper end of the new Group ranges.”
Margherita Della Valle
Group Chief Executive
| 5.2% Service revenue growth | 6.2% Adjusted EBITDAaL growth | Expect to deliver the upper end of updated FY27 Group guidance ranges |
– Total revenue: Increased 9.7% to €10.3 billion, due to strong service revenue growth and the consolidation of Three UK, partially offset by foreign exchange movements.
– Service revenue: Grew 9.8% to €8.6 billion and on an organic basis increased 5.2% with growth in all segments.
– Germany: Organic service revenue increased 1.2% (Q4: 1.3%) with higher Wholesale and fixed line revenue, reflecting strong broadband ARPU in Consumer and digital services growth in Business, despite continued mobile competitive pressure.
– UK: Organic service revenue increased 0.6% (Q4: -0.2%), with continued strong commercial momentum in Consumer broadband and Business fixed returning to growth.
– Other Europe & Türkiye: Organic service revenue increased 1.0% (Q4: 1.2%) in Other Europe, supported by strong Business growth. Service revenue in Türkiye increased 8.3% in euro terms1.
– Africa: Service revenue continued to grow double digit on an organic basis (Q1: 12.6%; Q4: 10.9%), with strong growth in Egypt and Vodacom’s international markets across both connectivity and financial services.
– Business service revenue: Organic service revenue accelerated to 5.0% (Q4: 3.2%), with high double digit-growth in digital services due to strong demand for our SaaS2, IoT and cloud & security products.
– Adjusted EBITDAaL: Increased 6.7% to €2.9 billion, and 6.2% on an organic basis driven by service revenue growth and improved operating leverage. Adjusted EBITDAaL margin improved 0.6 percentage points on an organic basis to 28.5%.
– Operating profit: Increased €2.9 billion to €3.9 billion, primarily due to a gain arising from the completion of the Safaricom transaction.
– Safaricom transaction complete: On 30 June 2026, we announced that Vodacom completed the acquisition of an effective 20%3 of the issued share capital in Safaricom, increasing its and the Group’s shareholding to 55%. Safaricom results will be fully consolidated by Vodacom and Vodafone Group from 1 July 2026.
– FY27 guidance: Our guidance for the year now includes the impact of consolidating Safaricom4 with Group Adjusted EBITDAaL expected to be €13.0 – €13.3 billion and Adjusted free cash flow expected to be €2.6 – €2.9 billion. We now expect to deliver the upper end of our updated Group guidance ranges.
Note:
1. Excluding the impact of hyperinflationary accounting adjustments.
2. Software-as-a-service.
3. Including 5% from Vodafone through its wholly owned subsidiary Vodafone International Holdings B.V.
4. FY27 Safaricom consolidation impact on a nine-month basis of €1.1 billion Adjusted EBITDAaL and nil impact on Adjusted free cash flow. The FY27 guidance reflect the following foreign exchange rates: €1: GBP 0.87; €1: ZAR 19.60; €1: TRY 53.07; €1: EGP 62.53; €1: KES 159.66.
