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Vodafone’s chief executive has committed to invest £1.5bn in upgrading its UK network this year, as the company takes the first steps towards fulfilling its pledge to have the best mobile network in the country, following the impending merger of its UK business with Three.
Vodafone said the investments — which will put pressure on competitors including BT and Virgin Media 02 — would focus on widening its network coverage and making technical improvements that will help integrate its network with Three’s network.
“We will have the best [spectrum], the best network and the largest customer base in mobile,” said Vodafone chief executive Margherita Della Valle on a media call after reporting full-year results on Tuesday.
The comments came after Vodafone reported adjusted earnings before interest, taxes, depreciation and amortisation of €10.9bn, in line with analyst estimates.
However, the company reported on Tuesday that it slipped to a reported operating loss of €400mn following €4.5bn of writedowns in Germany and Romania.
The £16.5bn merger of Vodafone UK and Three, which was approved by the UK’s Competition and Markets Authority in December, will see Vodafone take a 51 per cent stake in the company — which is expected to have more than 28mn mobile customers upon completion.
To secure regulatory approval the companies have pledged to make £11bn of network investments in total. They said this investment would provide a better-quality network that covered 99 per cent of the UK population.
“There is huge excitement from the side of Vodafone for day one,” said Della Valle, as she reiterated her commitment to turn around the company.
She has focused on cutting deals to strengthen Vodafone in key markets, such as the UK, while selling weaker operations across Europe.
The company sold its Italian unit to Swisscom in an €8bn deal in January this year, while the group’s Spanish operations were sold to Zegona for €5bn last May.
However, profits last year were dragged down by a weak performance in Germany. Earnings before interest, taxes, depreciation and amortisation in Vodafone’s largest market fell 12.6 per cent to €4.4bn.
That was largely due to a law change, introduced in July 2024, which gave customers living in housing association properties the opportunity to choose their own TV service provider. Vodafone reported that its TV customer base shrank about 50 per cent in Germany between July 2024 and March 2025.
Vodafone forecast earnings before interest, taxes, depreciation and amortisation of between €7.2bn and €7.4bn in Europe next year, below analyst expectations of €7.5bn.
Andrew Lee, head of TMT research at Goldman Sachs, said “lacklustre German growth” was to blame and that unless Vodafone could “articulate a clear path” to return to growth, investor confidence was likely to “remain muted”.
At the group level Vodafone forecast earnings before interest, taxes, depreciation and amortisation of between €11bn and €11.3bn this year, in line with analyst expectations.
The company also announced a new €2bn share buyback, with the first €500mn tranche beginning immediately. Vodafone shares were up as much as 1.5 per cent this morning.
