Vodafone Group (VOD) Q1 2026 earnings summary

Executive summary

• Q1 FY26 delivered 5.5% service revenue growth and 4.9% EBITDA/EBITDAaL growth, in line with expectations.

• Vodafone Three merger in the UK completed, forming the leading mobile operator, with integration and network improvements underway.

• Strong growth in emerging markets, especially Türkiye and Africa, while European growth slowed due to competition.

• Germany is stabilizing with improved customer churn and operational focus; U.K. faces short-term headwinds post-merger.

• FY26 financial guidance reiterated, with focus on customer experience and operational simplification.

Financial highlights

• Group service revenue grew 5.5% year-over-year in Q1, with Africa up 11.6% and Europe at 5.5%.

• Adjusted EBITDA/EBITDAaL increased by 4.9% year-over-year to €2.7bn, with margin up 0.2pp.

• U.K. service revenue growth slowed due to B2B contract losses and merger integration; Germany's service revenue nearly stable ex-MDU.

• Africa delivered strong growth, especially in Egypt (+43.9% YoY) and Vodacom Internationals (+12.6% YoY).

• Operating profit down 34.3% to €1.0bn due to prior year one-off gain from Indus Towers sale.

Outlook and guidance

• FY26 guidance maintained: Adjusted EBITDA/EBITDAaL €11.3–€11.6bn, adjusted free cash flow €2.4–€2.6bn, including UK merger impact.

• UK merger expected to contribute €0.3bn EBITDAaL and -€0.2bn FCF for 10 months in FY26.

• Germany expected to return to service revenue growth during the year; U.K. to see slightly negative growth for a few quarters, with improvement expected as merger synergies ramp up.

• Other Europe expected to maintain service revenue growth, with stronger performance in B2B and Greece in H2.

• Leverage ratio expected in the lower half of the 2.25–2.75x range.