Vodafone revealed on Tuesday that its net profit had fallen almost 8 percent in the last fiscal year.
The telecom giant also said that the decline in net profit was primarily caused by the $9.9 billion impairment charge it recorded for the company’s operation in Greece, Italy, Spain, Portugal and Ireland, where the company had to offer discounted services.
Vodafone's net profit came in just under 8 billion pounds, compared to 8.6 billion pounds in the year before. Revenue however, rose by 3 percent to 45.9 billion pounds.
“We enter the new financial year in a strong position,” Vodafone said, The Washington Post reports. “We are gaining or holding market share in most of our major markets, and are leading our competitors in the drive to migrate customers to smart phones and data packages.”
Analysts from Investec Securities predicted that Vodafone is likely to benefit from the rise in data revenue, as well as from the growing popularity of smartphones, and Vodafone's stock hasn't taken a deep hit after the news hit.
“The key risk to this stance revolves around the potential for voice and SMS declines to override the data growth, or the need to ramp up investment more than anticipated to cope with increasing data demand,” the Investec analysts said, who rated Vodafone as their top pick in the sector.