This article first appeared on GuruFocus .
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Group Service Revenue Growth:5.1% in the fourth quarter, with growth across Europe and Africa.
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Adjusted EBITDAaL Growth:4.5% organic growth for FY26, at the upper end of guidance.
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Adjusted Free Cash Flow:EUR 2.6 billion generated in FY26.
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Dividend Increase:Full year FY26 dividend increased by 2.5%.
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Africa Service Revenue Growth:Highest in almost two decades.
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Release Date: May 12, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Vodafone Group PLC ( NASDAQ:VOD ) achieved the upper end of its expectations for FY26, with strong service revenue growth of 5.1% in the fourth quarter across Europe and Africa.
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The company reported a 4.5% organic growth in adjusted EBITDAaL for FY26, aligning with the upper end of its guidance.
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Vodafone Group PLC ( NASDAQ:VOD ) increased its full-year FY26 dividend by 2.5% and announced a progressive dividend policy.
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The company is focusing on markets with sustainable structures, scale, and strong positions, which is expected to drive growth in FY27 and beyond.
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Vodafone Group PLC ( NASDAQ:VOD ) is expanding its fintech platform in Africa, now serving over 100 million users, indicating strong growth potential in emerging markets.
Negative Points
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Vodafone Group PLC ( NASDAQ:VOD ) faces ongoing pressure in the German market, with expectations of EBITDA decline in FY27 due to competitive challenges in mobile and TV segments.
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The company anticipates a decline in European EBITDAaL, particularly in Germany, due to continued competitive pressures and market dynamics.
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Vodafone Group PLC ( NASDAQ:VOD ) is temporarily above its target leverage range due to the UK JV buyout, although it expects to return to the lower half by the end of FY27.
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The company is experiencing subscriber losses in Germany, attributed to increased prices and competitive market conditions.
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Vodafone Group PLC ( NASDAQ:VOD ) acknowledges the need for regulatory changes in Europe to support a more confident and durable growth story, indicating potential challenges in the regulatory environment.
Q & A Highlights
Q: Why is Vodafone reinstating its midterm targets for double-digit free cash flow growth? A: Margherita Della Valle, CEO, explained that Vodafone is entering a new chapter after a deep transformation over the past three years. The company now operates from strong, scaled positions in all markets and benefits from a supportive environment for connectivity. This transformation and the diversified portfolio provide confidence for growth in FY27 and beyond.
Q: What are the expectations for European EBITDAaL, particularly in Germany, for FY27? A: Pilar Lopez, CFO, stated that Europe is expected to be broadly stable, with Germany facing a decline due to ongoing trends. However, the UK is expected to show strong growth due to synergy delivery. Margherita Della Valle added that while Germany's EBITDA will remain under pressure, improvements in B2B and consumer broadband are expected.
Q: How does Vodafone view M&A and leverage, especially after the UK JV buyout? A: Margherita Della Valle noted that the UK buyout was planned and temporarily affects leverage, but Vodafone aims to return to the lower half of its leverage range by the end of FY27. The focus remains on organic execution and driving double-digit organic free cash flow growth.
Q: Can you elaborate on the impact of AI on Vodafone's operations and strategy? A: Margherita Della Valle highlighted AI's dual role in enhancing network efficiency and meeting AI-driven demand for connectivity. Pilar Lopez emphasized AI's role in driving cost efficiencies and productivity, particularly in customer care and procurement, positioning Vodafone for structural cost base changes while enhancing customer experience.
Q: What is Vodafone's strategy for growth in Africa, and are there plans to increase exposure? A: Margherita Della Valle confirmed that Vodafone is increasing its exposure to Africa through the Safaricom transaction, taking control of a successful telecom and financial services company. The focus remains on managing the portfolio for value creation, with no immediate plans for further geographic expansion.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
