LONDON, Nov 11, 2025 (BSS/AFP) - British mobile phone giant Vodafone on Tuesday gave a positive outlook after an unexpected revenue rebound in main market Germany and following a sizeable UK merger.

Net profit dropped 22 percent to 829 million euros ($959 million) in its first half on higher costs, Vodafone said in an earnings statement.

But investors cheered slight revenue growth in Germany and the group's first dividend increase for seven years, sending Vodafone's share price rising four percent in London morning deals.

"In the second quarter we saw service revenue accelerating, with good performances in the UK, Turkey and Africa, and a return to top-line growth in Germany," group chief executive Margherita Della Valle said in the statement.

"Based on our stronger performance, we are now expecting to deliver at the upper end of our guidance range for both profit and cash flow."

The CEO launched a turnaround plan in 2023, which has included thousands of job cuts to slash costs, selling its Spanish and Italian branches and a UK merger with rival Three, which finalised at the end of May.

"In terms of strategy, the group had quite simply been fighting fires on too many fronts while dealing with an increasingly onerous debt burden, leading to the need for a significant transformation," Richard Hunter, head of markets at Interactive Investor, said following the latest results.

"What is now emerging is a smaller and less geographically diverse, but more focused, operation."

Vodafone on Tuesday said group revenue rose 7.3 percent to 19.6 billion euros in the six months to the end of September.

Service revenue in Germany gained 0.5 percent in the second quarter -- the first increase since legislation in the country prevented housing associations from bundling TV contracts with rent.

Vodafone offers customers broadband and television services in addition to its core mobile phone products.