20-F: VEON Reports Strong 2025 Growth Amid Digital Push

VEON achieved significant revenue and Adjusted EBITDA growth in 2025, driven by digital services expansion and strategic asset-light initiatives, despite geopolitical challenges and currency depreciation.

Summary

• Consolidated total revenue increased by 9.9% to US$4,399 million in 2025, up from US$4,004 million in 2024, with local currency growth of 14.2%.
• Consolidated Adjusted EBITDA grew by 18.9% to US$2,010 million in 2025, compared to US$1,691 million in 2024, with local currency growth of 24.2%.
• Operating profit increased to US$1,439 million in 2025 from US$1,110 million in 2024, partly due to the gain on sale of Deodar operations.
• VEON completed the sale of its Pakistan tower portfolio (Deodar) to Engro Corp on June 3, 2025, recognizing a gain of US$502 million.
• Kyivstar Group Ltd., VEON's Ukrainian subsidiary, was listed on Nasdaq on August 14, 2025, with VEON's interest decreasing from 100% to 89.6%.
• Kyivstar acquired a 97% stake in Uklon, a Ukrainian ride-hailing and delivery platform, for US$158 million on April 2, 2025.
• VEON successfully syndicated a 24-month, US$210 million senior unsecured term loan and completed a US$200 million private placement of senior unsecured notes due 2029.
• The company completed a US$100 million share buyback program across three phases in 2025 and authorized a new US$100 million buyback program for ADSs and/or outstanding bonds.
• VEON sold its Beeline Kyrgyzstan operations to Eldik Bank on August 12, 2025, resulting in a loss on disposal of US$97 million.
• Net foreign exchange loss of US$41 million was recorded in 2025, primarily due to the depreciation of the Bangladeshi taka, Pakistani rupee, and Ukrainian hryvnia.
• Capital expenditures (excluding licenses and right-of-use assets) increased to US$926 million in 2025 from US$818 million in 2024, focused on high-speed data networks.
• Digital revenues reached 17.3% of total revenue in 2025, up from 11.5% in 2024, reflecting the success of the Digital Operator 1440 model and acquisitions like Uklon.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this as a positive report, reflecting strong financial growth and successful execution of strategic initiatives, particularly in digital expansion and capital management. However, the score is tempered by persistent geopolitical risks and currency volatility in key operating markets.

Positives

• Consolidated total revenue increased by 9.9% (14.2% in local currency) to US$4,399 million in 2025, indicating strong underlying business performance.
• Adjusted EBITDA grew by 18.9% (24.2% in local currency) to US$2,010 million, demonstrating improved operational efficiency and profitability.
• Successful completion of the US$100 million share buyback program and authorization of a new US$100 million program signals confidence in financial health and commitment to shareholder returns.
• Kyivstar's listing on Nasdaq and the secondary offering raised US$132 million and US$140 million respectively, strengthening VEON's cash position and providing liquidity.
• Strategic acquisitions like Uklon (ride-hailing) and Tabletki.ua (digital healthcare) expand VEON's digital services portfolio and align with the Digital Operator 1440 strategy.
• Successful syndication of a US$210 million term loan and a US$200 million private bond placement demonstrates regained access to capital markets.
• Pakistan's total revenue increased by 17.5% (18.6% local currency), driven by increased data usage, repricing, and higher mobile financial services activity.
• Ukraine's total revenue increased by 25.8% (30.2% local currency), benefiting from higher roaming, data usage, and digital services, including Uklon's contribution.
• Kazakhstan's total revenue increased by 6.5% in local currency, driven by higher data usage, device sales, and repricing.
• Uzbekistan's total revenue increased by 12.8% (11.9% local currency), due to higher data usage, repricing, and strong digital product uptake.
• Bangladesh saw a one-off release of regulatory fee provision and minimum tax provision, positively impacting Adjusted EBITDA.
• VEON's commitment to invest US$1 billion in Ukraine between 2023 and 2027, focusing on network development and digitalization, underscores long-term strategic vision.
• The unfreezing of Kyivstar's corporate rights in November 2024 and high-level engagements with the Ukrainian Government have mitigated country-specific risks.

Negatives

• Net foreign exchange loss of US$41 million in 2025, primarily due to the depreciation of the Bangladeshi taka, Pakistani rupee, and Ukrainian hryvnia against the U.S. dollar.
• Bangladesh's total revenue decreased by 11.5% (6.5% in local currency) due to overall market contraction and lower data/voice consumption.
• Uzbekistan experienced a decrease in mobile customers by 7.2% and mobile data customers by 4.1% due to intensive market competition and tariff increases.
• The listing expense of US$162 million was recognized in connection with the Kyivstar Group's Nasdaq listing.
• An other non-operating loss of US$130 million was recorded in 2025, mainly due to a US$170 million provision for an arrangement with Dhabi Group and reassessment of a license asset in Kazakhstan.
• Finance costs increased to US$535 million in 2025 from US$495 million in 2024, mainly due to higher interest expense on lease liabilities.
• The sale of Beeline Kyrgyzstan resulted in a loss on disposal of US$97 million.
• The ongoing war in Ukraine continues to incur significant costs for security, fuel for diesel generators, and batteries, totaling approximately UAH 1,400 million (US$34 million) in 2025.
• Political unrest in Bangladesh and Pakistan has led to network outages, service restrictions, and increased operational risks.
• The company faces challenges in Bangladesh due to persistently high inflation (peaking at 9.94% in January 2025) affecting consumer spending.
• The Islamabad High Court issued an adverse tax ruling related to PMCL Deodar, leading to an additional tax expense of US$122 million in Q2 2025.

Risks

• Investing in frontier markets is subject to significant political, legal, and economic risks, including rapid changes in government policies and regulatory frameworks.
• The ongoing war in Ukraine poses risks such as adverse economic impact, physical damage to infrastructure, effects of sanctions on supply chains and financing, volatility in the Ukrainian hryvnia, and potential nationalization of Kyivstar.
• U.S. import tariffs and retaliatory trade measures have disrupted global supply chains, heightened economic uncertainty, and exacerbated inflationary pressures, increasing costs of goods.
• Adverse global developments like wars (e.g., Israel-Hamas, Israel-Iran), civil unrest, terrorist attacks, natural disasters, and pandemics negatively impact spending, increase operational costs, and risk network outages.
• The telecommunications and digital services markets are highly competitive, with rapid technological changes (including AI adoption) and evolving industry standards potentially harming competitive position.
• Barriers to 4G smartphone adoption in some markets (upfront costs, heavy taxation, import restrictions) may necessitate additional capital expenditure and expose the company to penalties for non-compliance with regulatory requirements.
• Rapid advances in AI introduce risks such as algorithmic bias, data privacy and security concerns, regulatory uncertainty, reliance on accurate data, and the potential for competitors to develop superior AI products.
• Cyber-attacks and other cybersecurity threats (e.g., data breaches, service disruptions, state-sponsored attacks) are continuous risks, potentially leading to financial losses, reputational harm, and legal liability.
• Network infrastructure is vulnerable to damage and disruption from natural disasters, military conflicts, power outages, and equipment failures, increasing operational costs and risking service interruptions.
• Dependence on third parties for services, equipment, and infrastructure exposes the company to risks of service cessation, increased costs, and supply chain disruptions (e.g., export control restrictions on Huawei).
• Existing indebtedness and debt service obligations may negatively impact cash flow, and the ability to raise additional capital on acceptable terms is crucial for meeting debt maturities and strategic investments.
• As a holding company, VEON relies on its operating subsidiaries for cash dividends and transfers, which can be restricted by corporate tax laws, capital controls, and covenants in financing agreements.
• Changes in tax treaties, laws, rules, or interpretations, including the recognition and recoverability of deferred tax assets, could harm the business and lead to significant uncertainties and risks.
• The company's tax residency in the UAE could be challenged, potentially leading to loss of tax treaty benefits and increased withholding tax rates.
• Legal proceedings, regulatory disputes, and tax audits can be expensive, time-consuming, and result in adverse outcomes, including fines, penalties, or license revocation.
• Laws restricting foreign investment (e.g., in Kazakhstan and a proposed policy in Bangladesh) could hinder business combinations, financing, or require divestment of stakes.
• Exposure to anti-corruption laws (e.g., FCPA) in high-risk countries, with potential for significant penalties and reputational damage from non-compliance or misconduct by employees or third parties.
• DFS offerings present increased exposure to fraud, money laundering, and regulatory risks, including capitalization requirements and compliance with banking laws.
• Telecommunications licenses are granted for specific periods and may be suspended, revoked, or renewed on less favorable terms, impacting business operations and financial results.
• Collection and processing of sensitive personal data subject to increasing data privacy laws and regulations, including cross-border data transfer restrictions and data localization requirements.
• The Beeline brand, used by some operating companies, is a trademark of the former Russian operating company, VimpelCom, and negative developments or a rebranding exercise could adversely impact reputation and incur substantial costs.
• Work stoppages and other labor matters, including loss of key personnel due to mobilization efforts in Ukraine, could adversely impact operations and performance.
• The majority-owned Kyivstar Group Ltd. being a public company may divert management time and attention to public company operations, potentially affecting VEON's performance.
• Climate change regulation may lead to material increases in operational and capital costs due to energy efficiency measures, carbon pricing, and infrastructure damage from extreme weather events.

Future Outlook

VEON's future outlook is centered on its Digital Operator 1440 (DO1440) and Augmented Intelligence 1440 (AI1440) strategies, aiming to expand digital services, leverage AI-powered capabilities, and maintain an asset-light model. The company plans significant investment in high-speed data networks, including continued 4G/LTE rollouts and 5G adoption in its markets. VEON and Kyivstar have a non-binding, collective initiative to invest US$1 billion in Ukraine between 2023 and 2027, focusing on network development, energy resilience, technological advancement, digitalization, and M&A. The company anticipates continued challenges from currency depreciation and geopolitical instability, particularly in Ukraine, but believes its cash balances and available credit facilities are sufficient to meet future capital requirements.

Management Comments

• VEON's management believes Adjusted EBITDA provides useful information to investors as an indicator of the strength, resilience and performance of our business operations.
• Our management believes that presenting capital expenditures, excluding licenses and the recognition of right-of-use assets, provides a more meaningful assessment of total capital expenditure due to the variability of license payments and recognition of right-of-use assets across multiple periods.
• Our management believes these operating data are useful in evaluating our performance from period to period and assessing the usage of our digital, mobile and broadband products and services.
• Management performed its annual impairment testing of goodwill as of September 30, 2025 and also tested non-goodwill CGUs for impairment as of the same date. Based on the quantitative and qualitative assessments and valuation analyses performed, no impairment or reversal of impairment was identified for any of our CGUs for the period ended September 30, 2025.
• Management anticipates that the funds necessary to meet our current and expected capital requirements in the foreseeable future (including with respect to any possible acquisitions) will continue to come from: cash we currently hold; operating cash flows; borrowings under syndicated bank financings, including credit lines currently available to us, and private credit financings; and issuances of debt securities on local and international capital markets.
• Management believes that VEON has paid or accrued all taxes that are applicable. Where uncertainty exists, VEON has accrued tax liabilities based on managements best estimate.
• Management has concluded that the conditions that previously gave rise to material uncertainty no longer exist. Accordingly, significant doubt about the Company’s ability to continue as a going concern no longer exists.

Industry Context

StockSavvy.ai notes that VEON's strategic shift towards a 'Digital Operator 1440' model, emphasizing digital financial services, entertainment, healthcare, and ride-hailing, aligns with broader industry trends of telecom operators diversifying beyond traditional connectivity. The 'asset-light' strategy, involving tower divestments and long-term lease agreements, is a common industry practice to unlock capital and focus on core services. The company's investment in AI-powered capabilities (AI1440) reflects the growing importance of artificial intelligence in enhancing customer experience and operational efficiency across the telecom sector. However, operating in frontier markets exposes VEON to higher geopolitical and macroeconomic risks compared to peers in more developed markets, as evidenced by the impacts of the war in Ukraine and political instability in Bangladesh and Pakistan. The consolidation in the Pakistani telecom market (Ufone and Telenor merger) indicates increasing competitive pressure, requiring VEON's Jazz to maintain its market leadership through network expansion and digital offerings. The regulatory changes in Bangladesh, particularly the proposed foreign ownership cap for MNOs, highlight the evolving and sometimes challenging regulatory landscape in emerging markets.

Comparison to Industry Standards

• VEON's 4G population coverage of 92.7% in Kazakhstan and 96.26% in Bangladesh demonstrates strong network expansion efforts, comparable to leading operators in other emerging markets.
• JazzCash's 21.5 million monthly active users and processing over 80% of Raast payment value in Pakistan positions it as a leading digital financial services platform, comparable to successful mobile money platforms like M-Pesa in Kenya or bKash in Bangladesh in terms of market penetration and transaction volume.
• Kyivstar TV's 2.5 million monthly active users and shift into content creation aligns with global trends of telecom operators like Vodafone or Orange expanding into media and entertainment, though on a smaller, localized scale.
• Beeline Kazakhstan's launch of AI Tutor, built on the locally developed KazLLM, showcases innovation in AI for underserved languages, a niche but important area for digital inclusion, similar to efforts by Google or Microsoft in developing language models for less common languages.
• The implementation of VoWiFi in Bangladesh by Banglalink, following a pilot, is a step towards enhancing call quality and reliability, a standard offering in more mature telecom markets.
• VEON's overall Adjusted EBITDA margin of 45.7% in 2025 is robust, indicating strong operational efficiency, potentially outperforming some peers in highly competitive or less diversified markets.
• The company's capital expenditure as a percentage of revenue (CAPEX intensity) varies by segment (e.g., Pakistan 11.2%, Ukraine 23.0%), reflecting different stages of network development and investment priorities, which is typical for a multi-market operator.

Management Changes

Corporate Governance

Legal Proceedings

• VEON Securities Class Action: A class action lawsuit alleging violations of U.S. federal securities laws related to Uzbekistan operations was settled for US$20 million, with preliminary approval granted on January 22, 2026, and final approval hearing scheduled for May 19, 2026.
• ADG Arbitration Claim: VEON entered into an agreement with the Dhabi Group to settle historical claims under a Shareholders Agreement for US$120 million in cash plus US$30 million equivalent in ADSs, with a potential further cash payment of up to US$60 million.
• VAT on Replacement SIMs Litigation (Bangladesh): Banglalink faces demands for unpaid SIM tax from the National Board of Revenue (NBR) for BDT 7.74 billion (US$63 million) for 2009-2011 and BDT 1.69 billion (US$14 million) for 2012-2015. Appeals are pending in the High Court Division of the Supreme Court of Bangladesh.
• BTRC Audit Findings (Bangladesh): Banglalink was subject to an extensive audit by the BTRC for 1996-2019, resulting in a claim of BDT 8,231 million (US$74 million), including BDT 4,307 million (US$39 million) for interest. Banglalink has paid the principal and is discussing a waiver of interest, initiating legal proceedings in February 2026.
• Islamabad High Court Tax Judgment (Pakistan): An adverse ruling related to PMCL Deodar led to an additional tax expense of US$122 million in Q2 2025, with a composite settlement framework totaling US$158 million being sought with tax authorities.
• Uklon Criminal Investigation (Ukraine): Ukrainian law enforcement initiated a criminal investigation relating to the accuracy of historical tax and financial reporting of Carved Out Entities associated with Uklon, with Uklon's CEO named in his former capacity. The Group and Uklon are cooperating, and the Group has not been named in the investigation.

Related Party Transactions

• Registration Rights Agreement: VEON Ltd., Telenor East, LetterOne Investment Holdings S.A., and LetterOne have an agreement requiring VEON to facilitate the registration of securities held by these parties for sale.
• Impact Investments Agreement: VEON entered into a 2024 Agreement with Impact Investments LLC (where Michael Pompeo, a VEON director, is Executive Chairman) for strategic support and board advisory services, involving monthly cash payments and equity warrant grants (Warrant A, B, C).
• Kyivstar Group Seller Loan Note: Kyivstar Group issued a promissory note for US$178,410,269 to VEON Amsterdam B.V. as partial consideration for the sale of VEON Holdings B.V. (now Kyivstar Holdings B.V.).
• Kyivstar Group Registration Rights Agreement: Kyivstar Group entered into a registration rights agreement with Cohen Circle Sponsor I, LLC, Cohen Circle Advisors I, LLC, and VEON Amsterdam B.V. for resale of common shares.
• Ukraine Tower Company (UTC) Agreements: JSC Kyivstar uses UTC's network infrastructure (wholly owned by VEON through a sister company) under service agreements for accounting, legal, treasury, procurement, and other support, and a Master Lease Agreement (MLA) for tower collocation services. UTC paid US$72.6 million in fees to UTC in 2025.
• General Services Agreement (JSC Kyivstar and VEON): VEON provides JSC Kyivstar with general support services (technical, commercial, legal, tax, HR) under an agreement extended until December 31, 2028. US$2.6 million was compensated to VEON in 2024.
• Agency and Services Agreement (JSC Kyivstar and VEON Wholesale Services B.V.): VEON Wholesale Services B.V. provided international roaming and telecommunications services to JSC Kyivstar until termination on March 31, 2024. US$4.4 million was paid in 2024.
• Indemnification Agreement (Kyivstar Holdings and VEON Amsterdam B.V.): An indemnity agreement is in place for Kyivstar Holdings regarding external payments to eligible legacy noteholders.
• Dividends Declared to Non-Controlling Interests: VIP Kazakhstan Holding AG declared US$67 million in dividends to NCIs in 2025, offset against a loan receivable.

Stakeholder Impact

• Shareholders: Benefit from increased revenue and Adjusted EBITDA, successful capital raises, and share buyback programs aimed at enhancing shareholder value. However, they face risks from geopolitical instability, currency depreciation, and potential dilution from future equity issuances.
• Customers: Benefit from expanded 4G/LTE networks, new digital services (e.g., ride-hailing, digital healthcare, entertainment), and AI-powered enhancements, leading to improved connectivity and digital experiences. However, they may experience service disruptions due to network outages (e.g., in Ukraine, Pakistan, Bangladesh) or increased tariffs.
• Employees: Benefit from incentive plans (Umbrella Incentive Plan) designed for retention and performance, and initiatives promoting diversity and inclusion. However, they face risks from potential work stoppages, personnel changes, and the impact of geopolitical events on operations (e.g., mobilization in Ukraine).
• Creditors: Benefit from successful debt refinancing and improved liquidity, but face exposure to foreign currency risk and potential breaches of covenants in volatile operating environments.
• Suppliers: May face disruptions due to geopolitical events, trade restrictions (e.g., export controls), and changes in VEON's asset-light strategy, which could alter procurement needs.
• Regulatory Authorities: Engage in ongoing discussions and audits with VEON, impacting licensing, tax, and operational compliance. Regulatory changes can impose new obligations or restrictions on the company's operations.

Next Steps

• Kyivstar TV has further projects in content creation in production for 2026.
• Mobilink Bank plans the rollout of ten Islamic Banking windows in 2026.
• Beeline Kazakhstan plans to first launch messaging in 2026, and then introduce data connectivity as the next phase in partnership with Starlink Direct to Cell.
• OLX Kazakhstan acquisition is subject to regulatory approvals and customary closing conditions.
• Qazcodes AI product portfolio will continue to expand with new products in 2026 and beyond.
• Beeline Kazakhstan has begun construction of the new Hyper Cloud data center in Almaty.
• NEO PSP Ltd. (Banglalink subsidiary) is subject to completion of full platform readiness, including technical and security compliance, by June 9, 2026.
• The BTRC is revising the related commercial framework for interconnection topology, with draft guidelines issued and industry consultations currently underway.
• The BTRC is drafting regulatory and licensing guidelines for the newly introduced license categories, with publication expected soon.
• The National Equipment Identity Register (NEIR) Directive in Bangladesh will introduce a feature enabling handset tagging with individual National ID numbers soon.
• The B2C transition for DBSS migration in Uzbekistan is planned for March 2026, with B2B transition continuing in 2026 and 2027.
• VEON and Kyivstar have a joint intention to invest US$1 billion in Ukraine between 2023 and 2027.
• VEON will continue to provide remaining holders of Old Notes further opportunities to exchange them for New Notes.
• The final approval hearing for the VEON Securities Class Action settlement is scheduled for May 19, 2026.
• Payments for the 190 MHz spectrum awarded to Jazz in Pakistan will be made in Pakistani Rupees beginning in 2027.
• VEON will make a further cash payment to the Dhabi Group (if any) equal to the difference of US$60 million and the market value of the ADS Payment, twenty-four months after the agreement date (March 13, 2026).

Key Dates

Recommendation

VEON's 2025 performance shows strong revenue and Adjusted EBITDA growth, driven by successful digital expansion and strategic asset divestments, which are positive indicators. The company has also demonstrated improved capital management by successfully refinancing debt and executing share buybacks. However, significant geopolitical risks, particularly the ongoing war in Ukraine and political instability in Bangladesh and Pakistan, introduce substantial uncertainty and potential for adverse impacts on operations and financial results. Currency depreciation in key markets also remains a headwind. While the strategic direction is sound, these external factors warrant a cautious 'hold' recommendation, as the upside potential is balanced by considerable unquantifiable risks.

Keywords

Telecommunications, Digital Services, Mobile Operator, 4G, 5G, Fintech, Entertainment, Healthcare, Ride-hailing, Super App, Pakistan, Ukraine, Kazakhstan, Uzbekistan, Bangladesh, Kyivstar, Jazz, Banglalink, Beeline, Uklon, Tabletki.ua, Asset-light strategy, Tower sale, Capital raise, Share buyback, SEC filing, Annual Report, Financial results, Adjusted EBITDA, Revenue growth, Geopolitical risk, Foreign currency risk, Cybersecurity, AI, Regulatory compliance, Debt financing, Nasdaq listing