Vodafone Group Plc Q1FY26 Q&A Transcript
Deutsche Numis
Goldman Sachs
New Street Research
Bank of America Merrill Lynch
Bernstein Societe Generale
Kepler Cheuvreux
1
Barclays
Citigroup
Berenberg
JP Morgan
BNPP Exane
Our focus is on creating value on that base, which is why you have seen us introducing handset financing with contracts of up to three years, working on Family Cards at the high end of the market for up-selling. We are pleased with the trends there. Obviously, the net ads were negative, and they were negative, however, because we continue to downsize the reseller segment in Consumer, which is, as you would expect, very low ARPU and low margin, and also, we had some negative low ARPU large contracts in B2B. So, overall, good progress. Different situation in fixed. In fixed, there was a change in the market environment. I mentioned already in May that the penetration of fixed has really plateaued in Germany, so there is not much market growth. And in these circumstances, on the back of the fact that also our churn has kept improving in that space, we have started to work on the front-book value early in Q1, and this has taken various shapes of a number of interventions, pricing in DSL, taking out the CableMax promo in cable, also reduction of some starting credits, reduction of commissions in indirect as well. Inevitably, all this adds some admittedly, I would say, looking at the numbers, small impact on the gross acquisitions. However, we have seen some positive signs in the market overall, I was mentioning this because, for example, in July, our main competitor has also reduced promotions in DSL. That is where we are on both segments. And I need to say, standing back from all these results, I said in May that we had done some structural changes in Germany. We have seen the step-up in customer experience with the best ever NPS. We are now seeing the impacts on churn. And I think we have all the ingredients in play in Germany, whether we are talking about the teams, the level of investments now, to really make the most of our position in the market. And we look forward, of course, to the return to growth that Luka was mentioning.
Robert Grindle
Thank you. Very comprehensive.
Deutsche Numis
Maurice Patrick
Yes, morning, guys. Hopefully, you can hear me and see me okay. If I could please just dive into the UK trends.
Barclays
In the UK, you showed a slowdown from about 3% to about 1%. You cite in the prepared remarks something around the business project milestones. However, if I understand correctly, the serious revenue growth trends now include Three UK. You have probably got a month in the 1Q numbers. You have changed the Group guidance. If I look at the net adds on the contract side, you have lost 46,000. So, curious to understand that 46,000 net adds or net losses, was that the Hutch base? Was that the Vodafone core branded base? When we think about the full inclusion for Q2, is that going to mean that we get a continued slowdown? Or maybe we should expect to see a recovery in the service revenues throughout the rest of the year? Thank you. Thanks for the question. I will perhaps cover the financial part and then when it comes to what we are seeing from an overarching more market momentum perspective, perhaps Margherita can attend to that.
Luka Mucic
Vodafone Group
Powered by FlippingBook