Vodafone Group PLC (VOD) shares surged 5.08% in Tuesday's trading session, following the company's announcement of a new share buyback program and optimistic future outlook. The telecommunications giant's stock price rise comes amid its ongoing efforts to streamline operations and improve performance in key markets.

The UK-based company unveiled plans for a €2 billion ($2.3 billion) share buyback program, with an initial tranche of €500 million commencing immediately. This move, part of a larger €4 billion return to shareholders following recent asset sales, has been well-received by investors. The buyback announcement comes on the heels of Vodafone's fiscal fourth-quarter and full-year results, which showed some encouraging signs despite ongoing challenges.

While Vodafone reported a slight decline in fiscal Q4 revenue to €9.36 billion from €9.39 billion a year earlier, the company's outlook for fiscal 2026 has boosted investor confidence. Vodafone expects adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) after leases to be between €11 billion and €11.3 billion for the upcoming fiscal year. The company also forecasts a return to top-line growth in its crucial German market by fiscal 2026, signaling progress in its turnaround efforts there.

Despite acknowledging "significant uncertainties" in the current macroeconomic environment, Vodafone's CEO Margherita Della Valle emphasized that the company's transformation initiatives are beginning to yield results. The telecom group has been focusing on streamlining its portfolio, reducing debt, and improving performance in key markets, particularly in Germany, which accounts for about a third of its total revenue. While challenges remain, including competitive pressures and regulatory changes in Germany, investors appear optimistic about Vodafone's strategic direction and commitment to shareholder returns.