Voda service rev growth back in black

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Vodafone recorded positive service revenue growth in Q1 in the UK as smartphone and data focus pays off.

Service revenue returned to positive growth in the UK for Vodafone in the three months to June 30.

UK service revenue was £1.2 billion, up slightly from the second quarter of 2009 and the third successive quarterly organic improvement in service revenue Vodafone claimed.

Vodafone said this was due to its strategic focus on selling smartphones and data plans. In line with this, data revenue in the UK was up from £137 million in Q2 2009 to £175 million in Q2 2010, while messaging revenue grew from £236 million to £273 million year-on-year. Conversely, voice revenue declined year-on-year from £726 million to £637 million.

Fixed line revenue was also up from £7 million to £8 million.

On a sequential basis, UK mobile subscriptions were down by 163,000 to 18.9 million, with 52.7 per cent prepay customers.

Vodafone reported a total churn of 40.1 per cent in the quarter, with 15.5 per cent of contract customers and 61.3 of prepay customers churning.

Overall, the Vodafone Group service revenue was £10.6 billion, with total revenue of £11.3 billion. Of that, data revenue across the group increased from £888 million to £1.2 billion against the same period last year, with voice revenue down slightly from £6.95 billion to £6.94 billion.

Group mobile subscriptions were up 10.9 million to 331 million sequentially.

Vodafone Group chief executive Vittorio Colao said: “These are the first quarterly results to show service revenue growth since the global recession impacted.

“We have achieved these results through our continuing commercial approach in key European markets, focusing especially on data, and from strong growth in emerging market.”

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