Virgin Media O2 has made significant progress in its network evolution, achieving a record footprint expansion in 2024 by adding 1.3 million serviceable homes, bringing its total gigabit footprint to 18.3 million homes. This expansion was primarily driven by the nexfibre FTTP network buildout, including the integration of Upp premises.
Additionally, the upgrade of the fixed network to fibre continued at pace, reaching a total fibre footprint of 6.4 million premises when including nexfibre coverage. The company also advanced in establishing a distinct fixed network company (NetCo) to support long-term fibre upgrade activities and service adoption.
The evolution of the mobile network to 5G saw significant strides, with outdoor population coverage reaching 75 percent by the end of 2024. In a notable regulatory milestone, the UK’s Competition and Markets Authority (CMA) approved the merger of Vodafone UK and Three UK, with Virgin Media O2 set to acquire spectrum from the newly formed MergeCo.
This acquisition, expected to commence in 2025, will be funded by proceeds from the minority stake sale in Cornerstone and is anticipated to enhance Virgin Media O2’s network quality and capabilities.
Lutz Schuler, CEO of Virgin Media O2, said: “Our investments of more than £2 billion across the year helped us to significantly boost our 5G coverage, improve mobile network quality and enhance rural connectivity.”
“We also expanded our fibre footprint faster than ever as we build on our existing gigabit leadership and push ahead with creating the biggest fibre challenger in the UK along with nexfibre,” Lutz Schuler said.
Virgin Media O2’s investment has assisted in improving customer experience, resulting into growth in user-base in 2024.
Virgin Media O2’s fixed customer base grew by 9,300 in 2024, including 9,900 net additions in Q4. Broadband connections increased by 21,300 across the year, with 12,000 added in Q4, primarily driven by strong performance in the nexfibre footprint. Investment in sales and marketing supported sequentially increasing net additions throughout the year. Fixed-line ARPU rose by 2.0 percent year-over-year to £47.74 in Q4.
Despite a net reduction of 216,300 mobile contract subscribers in 2024, the second half of the year showed improvement, with Q4 adding 15,600 net mobile contract customers. O2 monthly contract churn improved to 1.1 percent in Q4.
Virgin Media O2 also maintained leadership in the UK MVNO market, with sustained growth in wholesale connections, including within the Tesco Mobile joint venture. The total mobile base expanded to 45.7 million in 2024, with 850,300 net additions driven by IoT and wholesale growth.
Total revenue for 2024 decreased by 2.1 percent year-over-year to £10,680.5 million, with revenue excluding nexfibre construction falling by 3.9 percent. Mobile revenue declined by 4.4 percent to £5,687.0 million due to a 15.4 percent drop in low-margin handset sales.
Consumer fixed revenue rose by 2.3 percent to £3,400.2 million, supported by ARPU growth following a Q2 price adjustment and improved value retention. B2B fixed revenue dropped by 17.5 percent to £451.9 million due to a lower volume of long-term leases compared to 2023.
Other revenue increased by 4.6 percent to £1,141.4 million, driven by higher nexfibre construction revenue, partially offset by a £38 million revenue reduction from a related-party contract adjustment in Q3 2023.
In Q4 2024, total revenue declined by 4.0 percent year-over-year to £2,716.2 million, or by 2.8 percent when excluding nexfibre construction. Mobile revenue decreased by 2.4 percent to £1,484.6 million, with handset revenue declining by 4.6 percent, although improving sequentially throughout the year.
Consumer fixed revenue grew by 2.5 percent to £852.9 million, driven by a 2.0 percent ARPU increase. B2B fixed revenue dropped by 21.0 percent to £128.4 million due to a high volume of long-term leases signed in Q4 2023. Other revenue declined by 20.5 percent to £250.3 million, primarily due to reduced nexfibre construction revenue.
Baburajan Kizhakedath
