Vodafone (LON:VOD) shares fell on Friday after the telecommunications group released sales figures that pointed to a drop in group revenue.

In the three months to 31st December, Vodafone’s reported revenue fell 6.8% to €10.99 billion from €11.79 billion.

The group attributed the decline in sales to a number of factors including the sales of the Qatari business, changing reporting standards and the negative impact of foreign exchange.

Vodafone reported sales figures broken down into Europe and Rest of the World with both areas falling 5.6% and 11.1% respectively.

Weakness in Europe was found in Italy and Spain where increased price competition hurt sales.

Nick Read, Group Chief Executive, commented on the trading update:

“We have executed at pace this quarter and have improved the consistency of our commercial performance. Lower mobile contract churn across our markets and improved customer trends in Italy and Spain are encouraging, however these have not yet translated into our financial results, with a similar revenue trend in Europe to Q2. We enjoyed good growth across our emerging markets with the exception of South Africa, which was impacted by our pricing transformation initiatives and a challenging macroeconomic environment. Overall, this performance underpins our confidence in our full year guidance.

“We are moving to implement a radically simpler operating model and to accelerate our digital transformation, as demonstrated by the organisational changes we have announced in Spain and the UK.”

“We are also assessing opportunities across our markets to improve asset utilisation through partnering. This week we announced the intention to extend our existing network sharing agreement with Telefonica O2 in the UK to include 5G services. This will enable us to deploy 5G services to more customers over a wider geographic area, and to do so at a lower cost. After these arrangements have been finalised, we also intend to explore opportunities to monetise our UK tower assets”.

Shares in Vodafone (LON:VOD) were down over 2% in early Friday morning trade.