Vodafone sheds 127k contract users but loyalty strengthens across consumer brands

Vodafone’s mobile contract customer base declined by 127,000 during the year ended March 31. 

This included the disconnection of 53,000 low-value business SIMs and customer losses at Three UK. However, Vodafone said customer loyalty improved materially across all its consumer brands during the period.

Mobile service revenue increased 40 per cent year-on-year, although organic mobile service revenue declined 0.4 per cent due to pressure on business ARPU and tougher year-on-year comparisons from project milestones delivered in the previous year. Vodafone said performance improved in the fourth quarter, helped by stronger trading from Three UK brand, improved consumer contract ARPU, higher customer loyalty and wholesale growth.

Its prepaid brands, VOXI and SMARTY, added 189,000 customers during FY26, while broadband customers increased by 222,000. Vodafone also added 56,000 fixed wireless access customers and said it had been one of the UK’s fastest-growing broadband providers during the year, with gigabit broadband now available to more than 23 million households.

UK revenues surged 30 per cent to €9.2 billion in FY26 following the completion of the merger with Three UK, with the operator also reporting improving consumer momentum and broadband growth during the year.

Vodafone Business service revenue declined 2.3 per cent overall and fell 4.5 per cent on an organic basis during the year. The operator blamed the decline on contract terminations, lower inflation-linked price increases, contract renewals and reduced project activity, including a strategic change by a large customer.

Vodafone Group said the increase in revenues was driven by the consolidation of Three UK’s financial results following completion of the merger on 31 May 2025. Service revenue increased 29 per cent, while organic service revenue grew 0.3 per cent despite declines during the second half of the year.

Growth in  Consumer and Wholesale divisions reflected “strong commercial momentum” during the year, although this was partly offset by continued weakness in its Business division.

Fixed service revenue increased 0.3 per cent, while organic fixed service revenue rose 3.1 per cent, driven by broadband customer growth and higher ARPU in the consumer market. Vodafone said this was partly offset by declining business revenues linked to planned managed services contract terminations and lower project activity from enterprise customers.