Vodafone remains firm on growth expectations despite revenue dip

Vodafone has reported a drop in quarterly revenue but remained firm on its growth expectations for the full year.

Group revenue was 11 billion euros (£9.52 billion) in the third quarter, down by 0.8 billion euros.

The company blamed the decline on new accounting standards, foreign exchange headwinds and the sale of its Qatar business.

It reiterated guidance of 3% growth in underlying earnings for the year.

European revenue was down by 1.1% but the company said it had seen improving consumer trends in Italy and Spain.

Chief executive Nick Read said: “We have executed at pace this quarter and have improved the consistency of our commercial performance.

“Lower mobile contract churn across our markets and improved customer trends in Italy and Spain are encouraging, however these have not yet translated into our financial results, with a similar revenue trend in Europe to Q2.”

Rest of world revenue grew 4.9%, marking a slowdown on the 7.7% rate of the previous quarter.

A decline in the South African business Vodacom was offset by growth in other markets.

Earlier this week Vodafone announced its intention to extend a network sharing agreement with O2 in the UK to include 5G services, expanding the service to more customers over a wider area.

Shares in the company slipped 1.25% lower in early trading on Friday. The stock has seen its value decrease by over 35% versus the same time last year.

Neil Wilson, of Markets.com, said: “In the last 12 months the shares have seen some big falls driven by concerns about the size of its debt as well as future costs with 5G licences coming up for bidding, while the company has found competition fierce in most of its markets in particular Italy and Spain. “

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