VMO2 Navigates Challenging Market, Reaffirms Full-Year Outlook with Strategic Investments
Virgin Media O2 (VMO2) recently reported its Q2 2025 results, showcasing a complex picture of revenue headwinds offset by strong profitability and meaningful network investment. Despite a “tough trading surroundings,” as CEO Lutz Schüler described it, the company is maintaining its full-year guidance, signaling confidence in its long-term strategy. This article breaks down the key takeaways for you, the informed reader, and explores what these results mean for the future of connectivity in the UK.
Revenue Performance: A Mixed Bag
VMO2’s Q2 2025 revenue presented a nuanced landscape. While adjusted EBITDA showed positive growth, overall revenue figures experienced declines.Here’s a closer look:
Total Revenue: £2.527 billion, down 5.5% year-over-year.
Fixed Revenue (Consumer): £857.1 million, a 0.9% decrease attributed to a shrinking customer base.
fixed revenue (B2B): £99.2 million, down 8.2% primarily due to lower rental income.
Mobile revenue: £1.385 billion, a slight dip of 0.9%, driven by a 5.2% reduction in handset sales.
Nexfibre Joint Venture: Revenue from the accelerate-roll-out-of-UK-gigabit-project joint venture was £2.175 billion, a marginal 0.4% decrease.
Other Revenue: Experienced a significant 38.7% drop to £185.5 million, largely due to reduced nexfibre construction activity.However, it’s crucial to understand the context. The company is strategically shifting its focus, and some revenue declines are a result of prioritizing higher-margin services.
profitability Remains Strong
Despite revenue challenges, VMO2 demonstrated resilience in its profitability metrics.
Adjusted EBITDA (excluding nexfibre construction): £985.9 million, a 1.1% increase compared to Q2 2024. Total Adjusted EBITDA: £984.2 million, a slight 0.4% decrease year-over-year.
Adjusted EBITDA Margin: Reached 39.0%, a notable improvement from 36.9% in Q2 2024, reflecting a more favorable revenue mix.
This improvement in margin highlights VMO2’s success in driving cost efficiencies, including reduced operating expenses (Opex CTC). The company is effectively managing costs while investing in future growth.Customer Base & Network expansion
VMO2 continues to evolve its customer base and expand its network reach. Key figures include:
total Fixed-Line Customers: 5.7 million, a reduction of 51,000 in the quarter.
Total Mobile Connections: 23 million (contract and prepaid).
Mobile Contract Base: 15.6 million, with a decrease of 74,000 connections, largely due to lower-value B2B losses.
O2 Monthly Contract Churn: Improved year-over-year to 1.1%.
Total Mobile connections (O2 Network): Increased by 480,000 to 46 million, including IoT and MVNO wholesale customers. Full-Fibre Footprint: Now extends to over 7 million premises, with ongoing upgrades and nexfibre builds.
Gigabit Broadband Access: All 18.5 million serviceable premises now have access to speeds of at least 1Gbps.
These numbers demonstrate a strategic shift towards higher-value mobile contracts and continued expansion of the full-fibre network.
strategic Investments for the Future
VMO2 is making significant investments to bolster its network capabilities and future-proof its business.
Year-to-Date Investment: Over £1 billion invested in the company in 2025.
Spectrum Acquisition: £343 million investment to acquire 78.
