Vodafone Third Quarter Beats Expectations

LONDON-- Vodafone Group PLC on Thursday reported a narrower-than-expected fall in third-quarter revenue amid tough conditions in Europe, its key market.

Revenue in the three months ended Dec. 31 fell 3.6% to GBP10.98 billion ($17.91 billion), beating market forecasts of GBP10.86 billion.

Group service revenue, which makes up the bulk of the U.K.-based mobile giant's top line but excludes handset sales, fell 4.8% on a comparable basis that excludes acquisitions and disposals. That compares with a 2.6% decline in the same period last year.

On the same basis, revenue in Europe fell 9.6% in the quarter.

"In Europe, conditions are still difficult, and we continue to mitigate these challenges through ongoing improvements to our operating model and cost efficiency," said Chief Executive Vittorio Colao.

The world's No. 2 mobile operator by number of subscribers, after China Mobile Ltd., reiterated its fiscal-year guidance of adjusted operating profit at around GBP5 billion and free cash flow in the range GBP4.5 billion to GBP5 billion. It didn't disclose earnings figures.

A squeeze on consumer spending in recession-hit European markets, particularly in the south, has hurt Vodafone's results in the past few years, even as Mr. Colao last November said there are signs of a recovery.

Order free Annual Report for Vodafone Group Plc

Visit http://djnweurope.ar.wilink.com/?ticker=GB00B16GWD56 or call [phone]

Order free Annual Report for China Mobile Ltd.

Visit http://djnweurope.ar.wilink.com/?ticker=HK0941009539 or call [phone]

Order free Annual Report for China Mobile Ltd.

Visit http://djnweurope.ar.wilink.com/?ticker=US16941M1099 or call [phone]

Order free Annual Report for Vodafone Group Plc

Visit http://djnweurope.ar.wilink.com/?ticker=US92857W2098 or call [phone]

Subscribe to WSJ: http://online.wsj.com?mod=djnwires