Shares of Vodafone Group PLC (VOD.US) soared 5.13% in pre-market trading on Tuesday, following the release of its latest earnings report which revealed a return to growth in its key German market and the announcement of its first dividend increase in nearly eight years.

The British telecom giant reported a 7.3% increase in total revenue to €19.61 billion for the first half of fiscal year 2026, slightly above consensus estimates. The company's performance was bolstered by a 0.5% year-over-year organic service revenue growth in Germany, its largest market, reaching €2.74 billion in Q2 FY2026. This turnaround in Germany comes after more than 18 months of decline, primarily due to regulatory changes affecting TV subscriptions.

Vodafone's CEO, Margherita Della Valle, has been implementing an ambitious transformation plan, which appears to be paying off. The company announced a new "progressive" dividend policy, with plans to increase payouts by approximately 2.5% for FY2026. Additionally, management upgraded its FY2026 outlook, expecting adjusted EBITDAaL and adjusted free cash flow to reach the upper end of previous guidance. The positive results were also supported by strong performances in the UK and African markets, as well as the early progress of the Three UK merger. Despite these improvements, some analysts caution that a sustained trend will be necessary to fully convince investors of the company's recovery after years of challenges.