Africa’s fast-growing telecom markets have become an increasingly important engine of growth for Vodafone, helping the British telecom giant raise its earnings outlook after completing its takeover of Kenya’s Safaricom.
Vodafone has upgraded its financial outlook following the completion of its Safaricom acquisition.
- Vodafone has upgraded its earnings outlook after completing the acquisition of a controlling stake in Kenya’s Safaricom.
- Strong growth across Africa and Türkiye helped lift the telecom giant’s first-quarter performance.
- The Safaricom deal cements Africa’s growing importance to Vodafone’s long-term strategy, particularly in mobile money and digital financial services.
- The company now expects to deliver results at the upper end of its upgraded guidance.
Vodafone on Monday upgraded its financial guidance for the year ending March 2027 after consolidating Safaricom into its accounts, saying it now expects to deliver results at the upper end of its revised forecast following a stronger-than-expected start to the financial year.
The improved outlook follows the completion of Vodacom’s acquisition of a controlling 55% stake in Safaricom, Africa’s largest telecommunications company by market value and the operator behind the continent’s most successful mobile money platform, M-Pesa.
DON’T MISS THIS:<a href="https://absafricatv9491.live-website.com/south-africa-makes-travel-easier-with-48-hour-eta-visa-for-eligible-indian-travellers/" title="South Africa Makes Travel Easier with 48-Hour ETA Visa for Eligible Indian Travellers”>South Africa’s Vodacom takes control of East Africa’s biggest telecoms company in $2.4 billion deal
The transaction gives Vodafone greater exposure to East Africa’s fast-growing digital payments and telecommunications markets.
The company now expects adjusted core earnings (EBITDAaL) of between €13.0 billion and €13.3 billion ($14.8 billion-$15.2 billion) for the financial year ending March 2027, up from its previous guidance of €11.9 billion to €12.2 billion, while maintaining adjusted free cash flow guidance of €2.6 billion to €2.9 billion.
Chief Executive Margherita Della Valle said Vodafone had made a “good start” to the new financial year, supported by broad-based growth across its operations.
Group organic service revenue rose 5.2% during the first quarter, while adjusted core earnings increased 6.2%, driven by revenue growth and continued cost-saving initiatives.
Africa’s role keeps expanding
Africa was among Vodafone’s strongest-performing regions during the quarter, with its African operations delivering double-digit service revenue growth, supported by rising demand for mobile connectivity, financial services and data across markets including Egypt and Vodacom’s international businesses.
DON’T MISS THIS:Safaricom reaches agreement with Ethio Telecom to share towers and other telecom assets in Ethiopia
Safaricom, Kenya’s largest telecom operator, is expected to strengthen Vodafone’s earnings through its mobile and M-Pesa businesses.BI Africa
Vodafone said financial services continued to be one of its fastest-growing businesses, highlighting the increasing importance of mobile money across the continent. Group financial services revenue grew 27.1% during the quarter, reflecting stronger adoption of digital payments and banking services.
The company also reported that its African operations continued to add mobile customers while expanding demand for digital financial products, reinforcing the continent’s role as one of Vodafone’s key long-term growth markets.
Safaricom is one of Africa’s most profitable telecom operators and dominates Kenya’s mobile communications market through its voice, data and M-Pesa businesses.
Following the completion of the transaction on 30 June, Vodacom increased its effective shareholding in Safaricom from 35% to 55%, giving Vodafone full consolidation of the Kenyan operator’s financial results from July.
The deal also expands Vodafone’s footprint in Ethiopia through Safaricom Ethiopia, one of Africa’s newest telecom entrants.
DON’T MISS THIS:Safaricom’s Ethiopian expansion bid is quite ambitious; here are some fascinating growth projections for the telco
The company said the Safaricom acquisition alone is expected to contribute about €1.1 billion to adjusted core earnings over the remaining nine months of the financial year.
The upgraded guidance reflects more than just a larger corporate structure. It also underscores Vodafone’s growing reliance on African markets, where rising smartphone adoption, expanding digital payments and demand for financial services continue to outpace growth in many mature European markets.
For investors, the acquisition strengthens Vodafone’s exposure to one of the world’s fastest-growing mobile money ecosystems, positioning Africa as a bigger contributor to the group’s future earnings growth.
