VEON Ltd Earnings Call Highlights Digital-Led Growth

VEON Ltd ((VEON)) has held its Q4 earnings call. Read on for the main highlights of the call.

VEON Ltd struck an upbeat tone on its latest earnings call, highlighting strong operational momentum, accelerating digital growth and a healthier balance sheet. Management acknowledged macro, regulatory and refinancing risks, but argued that rising scale in digital services, disciplined CapEx and a committed buyback policy leave the group well placed for FY2026 and beyond.

Solid Top-Line Expansion Across the Group

VEON reported FY2025 revenue of $4.4 billion, up 9.9% year-on-year in U.S. dollars and about 11% on a like-for-like basis. Growth accelerated into year-end, with fourth-quarter revenue climbing 17% in dollar terms, underscoring broad-based momentum across its markets.

Record EBITDA and Meaningful Margin Gains

Profitability outpaced sales growth, with FY2025 EBITDA reaching $2.01 billion, up roughly 19% year-on-year. The EBITDA margin expanded by 350 basis points to 45.7%, while fourth-quarter EBITDA surged 29% in dollars, reflecting both operating leverage and cost discipline.

Digital Revenue Becomes a Core Growth Engine

Digital services have become central to VEON’s story, with FY2025 digital revenues jumping more than 62% to $759 million. In the fourth quarter, digital sales grew 84% year-on-year and accounted for over 20% of group revenue, versus about 17% for the full year.

Digital Businesses Deliver Profits at Scale

The company disclosed that direct digital revenues generated $207 million of EBITDA in FY2025, with an EBITDA margin of 27.3%. This shows VEON’s digital ecosystem is not only scaling rapidly, but also making a material contribution to group profitability rather than relying on heavy subsidies.

Expanding Digital User Base and Transactions

VEON’s ecosystem now serves more than 135 million active digital service users, while three-month active digital users exceed 200 million, surpassing its telecom subscriber base. The company also reported 33 million digital-only customers and total transaction value across its platforms of $55 billion, up more than 50% year-on-year.

Multiplay Customers Drive Monetization and Loyalty

Customers who use connectivity plus at least one digital service now account for 56% of consumer revenues. These multiplay users generate nearly four times the ARPU of voice-only customers and churn at roughly one-third the rate, improving both revenue quality and customer lifetime value.

Pakistan Fintech Franchise Shows Strong Traction

In Pakistan, VEON’s JazzCash platform reached 21.5 million monthly active users and more than 511,000 merchants. Management highlighted transaction value around 53 billion and a Mobilink Bank loan portfolio of 264 million with high loan quality, underlining the strength of its digital financial services franchise.

Leverage Falls as Cash Position Strengthens

VEON closed FY2025 with $1.73 billion of cash, including $557 million at the holding company. Net debt excluding leases declined to $1.75 billion, bringing leverage down to 1.09 times EBITDA from about 1.34 times, giving the group more flexibility ahead of upcoming debt maturities.

Buybacks and Kyivstar Listing Support Equity Story

The company completed a $100 million share repurchase in August 2025 and has a second $100 million program underway, backed by a policy to buy back at least $100 million of shares annually. VEON also highlighted the NASDAQ listing of Kyivstar, currently valued at about $2.4 billion, with its stake worth roughly $2 billion.

Asset-Light Strategy and High-Profile Tech Partners

Management continued to push an asset-light model, completing the sale of its Pakistan tower portfolio and deconsolidating TNS+. VEON also launched direct-to-cell connectivity with Starlink in Ukraine and Kazakhstan, with Bangladesh to follow in 2026, and is developing local-language AI models in Kazakh, Ukrainian, Urdu, Uzbek and Bengali.

2026 Guidance Points to Continued Growth

For 2026, VEON guided to U.S. dollar revenue growth of 9% to 12% and EBITDA growth of 7% to 10%. The group expects CapEx intensity excluding Ukraine to fall to 14% to 16% of revenue and is targeting at least a double-digit free-cash-flow-to-revenue ratio, while keeping net debt excluding leases around 1.5 times EBITDA.

Margins May Slow After a Strong Expansion Year

The new guidance implies that revenue will grow somewhat faster than EBITDA in 2026, after a year of sharp margin gains. This suggests investors should expect modest margin compression versus 2025’s 350 basis point expansion, as the company invests to sustain growth and absorbs cost pressures.

Inflation, Refinancing and Regulatory Risks Persist

Management cautioned that sustained oil prices between $90 and $120 per barrel could lift inflation in its markets by 2% to 9%, pressuring costs and pricing decisions. The timing of regulatory approvals for deals in Kazakhstan and insurance, along with plans to address 2027 bond maturities, remains an execution and market risk factor.

Pakistan 5G Rollout and Currency Exposure

VEON acquired 190 MHz of spectrum in Pakistan for $240 million across several bands, but noted that 5G phone penetration remains below 5%. Monetization is likely to be gradual, while costs denominated in Pakistani rupees expose the group to currency and local inflation risks against its U.S. dollar guidance.

Capital Returns Favor Buybacks Over Dividends

The company reiterated its focus on share repurchases, committing to buy back at least $100 million of stock annually with shares cancelled. While management said investors broadly prefer buybacks to dividends, the absence of a near-term dividend outlook may limit appeal for yield-focused shareholders.

Kyivstar Shines Amid Ongoing Ukraine Uncertainty

Ukraine remains a key geopolitical risk, yet Kyivstar delivered strong fourth-quarter results with revenue up 10% and EBITDA up 18% year-on-year. Management sees significant upside if the conflict environment improves, but reconstruction and policy choices could also shape the operating landscape in unpredictable ways.

Guidance Signals Confident but Disciplined Outlook

Looking ahead, VEON’s management framed 2026 as a year of continued growth, disciplined investment and active capital returns. With robust cash, lower leverage and a firm buyback policy, the company aims to navigate inflation, FX and regulatory risks while maintaining at least double-digit free cash flow margins and addressing its 2027 bond well before maturity.

VEON’s earnings call painted the picture of a telecom operator transforming into a digital ecosystem player, with digital revenues and users rising sharply and balance sheet metrics improving. While investors must weigh margin normalization, macro volatility and geopolitical risks, management’s growth guidance and ongoing buybacks suggest confidence in the company’s trajectory.