Vodafone has lowered its revenue outlook for the year in the face of the economic downturn. The mobile phone group particularly flagged up Spain as a problem area; it lost business there as large numbers of immigrant construction workers – who had been Vodafone customers – left the country when the housing market slowed.
Vodafone’s shares dropped, wiping 12.5 billion euros off the company’s worth. The rest of the European telecoms sector also suffered including Spain’s Telefonica. Vodafone, which is the world’s largest mobile company in terms of revenue, operates in 65 countries and has almost 270 million customers.
Recently it has made a determined effort to get into faster-growing emerging markets – eastern Europe, the Middle East, Africa and the Asia Pacific region. Expansions include Turkey, India, Qatar and Ghana.
The Vodafone effect also pulled down shares of the world’s biggest mobile phone equipment maker Ericsson. That even though the Swedish firm – which is going through restructuring – reported better-than-expected second-quarter earnings and reiterated that it expects the mobile infrastructure market will remain stable this year.