Shares of the UK-based Vodafone Group PLC (GB:VOD) gained 1.25% as of writing after the company’s Q1 FY25 revenue grew by 2.8% year-over-year to €9.04 billion on a reported basis. The company’s service revenue increased by 3.2% in the first quarter. Driven by its satisfactory Q1 FY25 numbers, Vodafone confirmed its full-year guidance.
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In FY25, adjusted EBITDAaL (earnings before interest, taxes, depreciation, amortization, and adjusted loss) is projected to be around €11 billion, while adjusted free cash flow is expected to be at least €2.4 billion. In Q1 FY25, adjusted EBITDAaL increased to €2.68 billion from €2.63 billion a year ago.
Vodafone offers various services, including voice, messaging, and internet connectivity across fixed and mobile networks.
Vodafone’s Regional Performance in Q1
Regionally, Vodafone’s service revenues were down by 1.5% to €2.8 billion in its key market, Germany. This was attributed to the change in the regional TV law. Excluding this, revenues were down by just 0.3%.
In the UK, services revenue increased by 2% to €1.43 billion in Q1 as compared to a 6.8% growth in the previous quarter. The company stated that within the rest of Europe and the UK, it witnessed softer growth due to a slowdown in inflation.
Meanwhile, in Turkey, service revenue soared to €515 million, marking a huge year-over-year growth of 54.7%. In Africa, service revenue gained 1.6%.
Is Vodafone a Buy, Sell, or Hold?
Following the Q1 update, VOD stock received two Buy recommendations from analysts. Goldman Sachs analyst Andrew Lee expects a 63.1% upside potential, while Robert Grindle of Deutsche Bank projects a higher upside of 98.6%.
According to TipRanks, VOD stock has a Moderate Buy rating based on four Buys, five Holds, and one Sell. The Vodafone share price target is 93.67p, which implies an upside of 32.4% on the current trading levels. The price target has a high forecast of 140p and a low forecast of 65p.
