Guidance: H1 pace allows for H2 slowdown as Vodafone moves into cleaner air

Vodafone Group FY25-26 Half-Year Performance

Vodafone Group has reaffirmed its full-year outlook for FY25-26, expecting to reach the upper end of its earnings and free cash flow targets. The company credits a robust first half of the financial year, which provides the flexibility to anticipate slower growth in the third and fourth quarters.

Key Financial Highlights

Adjusted EBITDAaL grew by 5.9% on a reported basis to €5.7 billion for the first half, with an organic increase of 6.8%.
Service revenue growth was strong across most markets, despite some impact from regulatory changes in Germany and ongoing commercial investments.
Adjusted free cash flow is expected to be in the range of €2.4-2.6 billion for FY26, hitting the upper guidance level.
Operational improvements and network integration, especially in the UK with the Vodafone and Three networks, contributed positively.

Strategic and Operational Progress

The group made good progress on strategic goals, driving operational efficiencies and expanding customer satisfaction initiatives. Increased demand for digital services supported organic growth of 2.9% in Q2. Vodafone also launched 5G in June, supporting a strong summer campaign.

“Based on our stronger performance, we are now expecting to deliver at the upper end of our guidance range for both profit and cash flow, and as our anticipated multi-year growth trajectory is now under way, we are introducing a new progressive dividend policy, with an expected increase of 2.5% for this financial year.”

Dividend and Shareholder Returns

Reflecting confidence in medium-term free cash flow growth, Vodafone has introduced a progressive dividend policy, anticipating a 2.5% increase in the FY26 dividend per share.

Management Perspective

Outgoing CFO Luka Mucic highlights overall positive prospects for the company after his departure. The company balances solid H1 results with a moderated growth forecast for the latter half of the year, aiming toward sustainable performance.

“The group reaffirms its full-year outlook but acknowledges that the pace of growth will slow in Q3 and Q4, buoyed by the strong first half.”

Outlook

The group expects to maintain operational momentum while managing the expected slowdown in the second half. Investments continue in cloud, data demand, and customer experience across Europe and emerging markets like Turkey, supporting long-term growth.

Overall, Vodafone’s strong H1 performance sets a solid base for FY25-26, signaling a move into a cleaner, more sustainable operational phase with improved profitability and cash flow generation.

Author’s summary: Vodafone’s robust first-half results enable the company to aim for the top of its financial targets while preparing for more measured growth ahead, supported by strategic improvements and a progressive dividend policy.

TelcoTitans.com — 2025-11-20