Germany's growth drives Vodafone’s first dividend hike since 2016

Anabelle Colaco
12 Nov 2025, 11:15 GMT+10

Vodafone is giving shareholders something they haven’t seen in nearly a decade: a dividend increase
The British telecoms giant announced the move on November 11, its first hike in eight years, after posting a return to top-line growth in Germany and raising its earnings forecast for the year
Shares surged five percent in early trading to 94 pence, marking a two-and-a-half-year high

LONDON, U.K.: Vodafone is giving shareholders something they haven't seen in nearly a decade: a dividend increase. The British telecoms giant announced the move on November 11, its first hike in eight years, after posting a return to top-line growth in Germany and raising its earnings forecast for the year.

Shares surged five percent in early trading to 94 pence, marking a two-and-a-half-year high.

The decision follows a difficult stretch for the company. Vodafone cut its dividend by 40 percent in 2019 to rein in debt after hefty investments in 5G spectrum across Europe. Now, with operations stabilising and key markets recovering, the company says it's in a position to reward investors again.

CEO Margherita Della Valle said the return to growth in Germany, its largest market, was a key driver of the improved performance. Vodafone had previously taken a hit in the country due to changes in TV subscription laws that affected customer fees.

"In the second quarter we saw service revenue accelerating, with good performances in the UK, Turkey and Africa, and a return to top-line growth in Germany," Della Valle said.

She also pointed to early momentum in the company's merger with Three UK, which was completed in May. The deal, with Hutchison's mobile unit, makes Vodafone the largest operator in Britain.

With stronger financials, Vodafone now expects to hit the upper end of its full-year guidance: adjusted core earnings between 11.3 and 11.6 billion euros and free cash flow of 2.4 to 2.6 billion euros.

The company will now adopt what Della Valle called a "progressive dividend policy," targeting a 2.5 percent increase for this financial year.