Vodafone to cash in on smartphone demand

Mobile phone giant Vodafone yesterday revealed it aimed to capitalise on rocketing consumer demand for so-called smartphones.

Vodafone, unveiling a 3 per cent rise in interim operating profits to over 6 billion, pledged further investment in its European infrastructure to meet increased data demand as customers watch more video content on mobile phones.

The company said it was also planning a new pricing strategy for mobile data geared to tiered charging and different service levels.

It came as Vodafone raised its guidance for full-year profits from 11.8bn to 12.2bn against an earlier forecast of 11.2bn to 12bn, after higher than expected revenue growth in all its operating regions.

UK revenues were up 5.2 per cent in the second quarter, leading to growth of 2.9 per cent in the first half, as the increased take-up of smartphones such as Apple's iPhone and mobile internet bundles more than offset "intense" competition.

The group said medium term it expected organic revenue of 1 to 4 per cent a year, driven by strong demand for mobile data and emerging markets.

Vodafone, which recently sold its 3.2 per cent stake in China Mobile for $6.5bn (4bn), said it was open to selling other assets it does not control. Vodafone's shares closed down 1p at 174p.