Africa's Growth Powers Vodafone
Vodafone's Q1 results reveal strong revenue growth, propelled by double-digit gains in Africa
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Key Points
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Africa remains the standout region with particularly strong growth: Vodafone’s Africa operations posted double-digit service-revenue growth in Q1, including a substantial contribution from Vodacom’s markets, and M-Pesa saw organic growth of 23.6% to €137 million, with Vodacom international markets accounting for 31.2% of service revenue in these markets.
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Regional mix in Europe showed mixed momentum: Germany’s organic service revenue rose about 1.2% (driven by wholesale and fixed-line gains), the UK returned to growth with about 0.6% organic service revenue growth, and Türkiye delivered a stronger euro-term gain of 8.3%.
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Safaricom consolidation is expected to lift earnings: Vodafone’s full consolidation of Safaricom from 1 July is anticipated to add around €1.1 billion of EBITDAaL this year.
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2027 cost and integration agenda remains sizable: Vodafone projects restructuring and integration costs of around €0.7 billion for 2027, including approximately €0.4 billion related to the VodafoneThree merger.
Vodafone posted a strong start to its 2027 financial year, with total first-quarter revenue climbing 9.7% to €10.29 billion, according to MarketScreener. Group service revenue rose 9.8% to €8.6 billion, fuelled by the addition of Three UK and continued double-digit growth across Africa.
Organic service revenue — which strips out mergers and currency moves — grew 5.2%, Ask Traders reported. Vodafone said first-quarter momentum supports its full-year outlook, and it now targets the upper end of its EBITDAaL guidance range.
Africa Leads the Pack with Double-Digit Gains
Africa was Vodafone's standout performer in the quarter. Vodacom's markets delivered double-digit service revenue growth, with M-Pesa — the group's mobile money platform — growing organic revenue 23.6% to €137 million, according to MarketScreener. Vodacom's international markets now account for 31.2% of service revenue across those operations.
M-Pesa's surge reflects rising demand for digital financial services across sub-Saharan Africa. More people are using mobile phones to send money, pay bills, and access credit — services that banks have historically not provided to rural communities.
Safaricom Deal Set to Add €1.1 Billion to Earnings
Vodafone's full consolidation of Safaricom — the Kenyan telecoms giant — begins on 1 July. The group expects Safaricom to add around €1.1 billion of EBITDAaL this year, according to Ask Traders. EBITDAaL is a measure of operating profit after leasing costs — essentially how much cash the business earns before taxes and debt payments.
The Safaricom addition is one of two major earnings boosts Vodafone is counting on. The other is the merger of Vodafone UK with Three UK, which is expected to generate significant cost savings as the two networks are combined. Restructuring and integration costs for 2027 are projected at around €0.7 billion, with roughly €0.4 billion tied to the Three merger, MarketScreener reported.
Europe Shows Mixed Picture Across Key Markets
Results across Europe were uneven. Germany — Vodafone's largest European market — grew organic service revenue just 1.2%, driven by wholesale and fixed-line gains. The UK returned to growth at 0.6% organic service revenue, helped by a rebound in consumer broadband and business fixed lines, MarketScreener noted.
Türkiye was the European region's brightest spot, delivering an 8.3% gain in euro terms. That figure partly reflects the Turkish lira's recovery rather than underlying customer growth alone. Still, the result adds to an overall picture of gradual stabilisation across Vodafone's European footprint.
Vodafone Business Bets on IoT and Cloud Services
Vodafone's business division continued to grow, with double-digit gains in digital services including IoT — technology that connects everyday devices to the internet — cloud security, and software-as-a-service products, according to Ask Traders. These higher-margin services are central to Vodafone's strategy to move beyond basic phone and data plans.
The group said its multi-year cost programme and strategic acquisitions are designed to deliver sustained growth across its diverse global footprint. With Africa firing, the UK recovering, and Safaricom about to land on the books, Vodafone's leadership appears confident the momentum will hold through the rest of the year.
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