A milestone for Vodafone (NYSE: VOD), as good ‘ol fashioned voice revenue ebbs – quarterly mobile data income exceeded £1 billion ($1.6 billion) for the first time, the carrier said, as it announced a tenth higher October-to-December revenue.
Data revenue rose 17.7 percent from the same period last year and now makes up 11 percent of Vodafone sales. Smartphones are now a quarter of the sales mix, but that is projected to go up to 30-40 percent in 2010/11 (Voda just got UK iPhone carriage).
Across the group, Vodafone clocked 10.3 percent higher revenue of £11.5 billion ($18.3 billion). But the mobile operator is continuing to see the impact of competition in its core European market, where service revenue fell by 3.2 percent to £7.2 billion ($11.4 billion) on an organic basis.
Fixed-line revenue grew by 10 percent to £862 million ($1.4 billion). Vodafone says it now has more than five million broadband customers in Europe, with Italy the strongest market in terms of growth, at 22.3 percent.
Compared to service revenues in Europe, there’s better news in smaller emerging markets: service revenues in Asia Pacific and the Middle East rose by 10.4 percent to £1.6 billion, while in India it was up by 13.8 percent. Verizon Wireless, Vodafone’s JV with Verizon in the U.S., saw an increase of 4.7 percent. Vodafone added 10.3 million customers to its network, bringing the total to 333 million.
Vodafone has narrowed its forecast for the financial year to £11.4-£11.8 billion, compared to previous guidance of £11-£11.8 billion.
From the earnings call:
— iPhone impact: In the earnings call, CEO Vittorio Collao said that carrying the iPhone has definitely given the carrier an ARPU lift “But it’s too early to comment” on what it is. Currently around three-quarters of iPhone subscribers are current users upgrading; the rest are new customers.
— Vodafone 360: The operator’s social-media service layer focussing on service element is “heading in the right direction”, says Collao. Looks like it might be moving into something that will be offered on other handsets, besides Vodafone’s own-branded devices: “We might need dedicated handsets but it is the service component that [will be] emphasized in the future rather than the hard form factor.”
— Update on SFR: “Open minded” was Collao’s response to reports about potentially selling off its minority stake in French mobile oerator to Vivendi (EPA: VIV), the other major shareholder. “SFR is trading well, growing at one percent versus europe shrinking three percent.” He is it is “very well positioned from a competition point of view.” Divdends will be increased. “It