Vodafone has recorded an 8% increase in its revenue to €40.5bn, following strong service growth and its consolidation of Three UK.

The telecommunications firm said this increase was partially offset by foreign exchange movements.

In the year to 31 March, Vodafone’s service revenue increased by 8.8% to €33.5bn, with its UK division’s service revenue jumping by 0.3%, while its German market saw its service revenue drop by 0.2%.

The firm’s earnings jumped by 3.8% year-on-year to €11.4bn, while also recording an operating profit of €2.8bn, following a loss of €40m in FY25.

Vodafone stated that it is now "entering a new chapter as a simpler and stronger business" following its transformation actions and its external environment now creating new opportunities.

Group chief executive at Vodafone, Margarita Della Valle, said: "Our strategic progress has generated good Group service revenue momentum for the year, together with profit and cash flow at the upper end of our guidance range. We returned to top line growth in Germany, alongside strong performances across Africa and in Türkiye. Our early successes from the UK merger integration reinforce our confidence in its potential and I am delighted that we are now gaining full ownership."

In its outlook, Vodafone said the current macroeconomic climate represents "specific uncertainties" which may impact its financial performance in the year ahead.

Based on its current prevailing assessments of the macroeconomic outlook, its earning are expected to be between €11.9bn and €12.2bn, while its free cash flow is set to reach between €2.6bn and €2.9bn.

Following the update, shares in Vodafone dropped by almost 7%.

Head of markets at AJ Bell, Dan Coatsworth, concluded: "In the stock market it’s often said that it’s better to travel than arrive, hence why shares in Vodafone dipped on robust-looking full-year results after a strong rally in the past 12 months.

"The numbers were at the top end of guidance as Della Valle pointed to strong prospects after shedding underperforming parts of the business and driving a consolidation of its UK operations.

"The big growth is being delivered in less mature markets in Africa where its Vodacom operations are chalking up double digit increases in service revenue. After years of going nowhere in stock market terms, Vodafone has been rewarded for its strategic progress over the past year. Today’s market reaction is a reminder it cannot sit on its laurels."

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