Vodafone Group Plc (LON: VOD) was seen trading down as much as 10% today after reporting a hit to its profit in fiscal 2023.
Vodafone shares down on weak guidance
On Tuesday, the telecommunications giant said its adjusted EBITDA declined 1.0% to €14.67 billion ($15.95 billion) in the year ended March 31st.
Energy expenses and commercial weakness particularly in Germany, it added, saw revenue tick up only 0.3% to €45.71 billion. In comparison, analysts were at €14.73 billion and €45.52 billion, respectively.
For this year, Vodafone forecasts its adjusted EBITDA to remain about flat at €13.3 billion and its cash flow to tank significantly to €3.3 billion. Its Spanish business is currently under strategic review as well.
Vodafone shares are now down 20% versus their year-to-date high at writing.
Vodafone commits to cutting costs
On the plus side, Vodafone confirmed that it was committed to turning leaner.
Today, the British multinational revealed plans of lowering its headcount by 11,000 to cut costs. In the press release, its CEO Margherita Della Valle said:
Our performance has not been good enough. To consistently deliver, Vodafone must change. My priorities are customers, simplicity and growth. We will reallocate resources to deliver quality service our customers expect.
The board announced 4.5 eurocents a share of final dividend on Tuesday. Despite weak results, Wall Street currently has a consensus “overweight” rating on Vodafone shares and sees in them about a 40% upside from here on average.