Vodafone cuts thousands of jobs as Africa carries the business

Vodafone is shrinking in Germany and growing in Africa. The British phone company removed about 3,000 jobs in the six months to September and has now announced 2,300 more cuts in Germany. That brings the total to about 5,300. At the same time, it raised its profit and cash forecasts for the year, helped by strong African results.

What changed

Vodafone reported a loss of €3.6 billion, about $4 billion, for the half year. A year earlier it made a €1.1 billion profit. Chief executive Margherita Della Valle said the company needs to be simpler, and also needs to keep investing in customer experience.

Most of the loss comes from a €4.85 billion charge on the German business, about $5.4 billion. It is a non-cash charge, meaning an accounting write-down. No money of that size left the company. Vodafone blamed higher German government bond yields and a revised view of how the unit is performing.

Why Germany is struggling

Germany is Vodafone's largest single market. Service revenue there fell 0.5% in the second quarter, after growing 1.2% in the quarter before. A July 2024 change in German law let people in housing-association properties pick their own television provider. Vodafone had supplied many of them through housing contracts, so it lost customers.

Where Africa fits

African service revenue grew 13.4%. Vodafone owns 65.1% of Vodacom, a Johannesburg-listed company with operations in South Africa, Egypt, Ethiopia, Kenya, Tanzania, Mozambique, the Democratic Republic of Congo and Lesotho. Vodacom now serves 250 million customers, including 108 million who use its financial services.

• Vodacom revenue rose 25.6% to R102.5 billion, about $6.1 billion, partly because Safaricom was added to its accounts.
• Financial-services revenue almost doubled to R15.9 billion, about $942 million.
• Customers started more than $575.5 billion in transactions on its platforms over 12 months.
• It spent R13.3 billion, about $788 million, on its network.

What is not settled

Vodacom raised its stake in Kenya's Safaricom to 55% in a $1.6 billion deal. That brought it closer to M-Pesa, one of Africa's largest mobile-money platforms. A Kenyan court has since declared the purchase invalid, citing problems with public participation and disclosure. Vodacom and the Kenyan government are appealing. For now, the Court of Appeal has kept the current ownership in place.

Vodafone still counted Safaricom in its results and booked a separate €3 billion gain, about $3.4 billion, from revaluing its earlier stake. The material does not say where in Germany the 2,300 cuts will fall or how the appeal will end.

What to watch

Phone companies are leaning on mobile money and fast-growing markets, not only phone plans. If you use Vodafone in Europe, watch for any change in service or prices as the company simplifies. The article does not say whether customers will see any.