Vodafone made a massive £13.5 billion sterling pre-tax loss after goodwill amortisation and exceptional items were included.
The losses included a £6 billion charge on the value of non-mobile assets.
But the market had feared an even bigger writedown and focused instead on earnings before interest, tax, depreciation and amortisation, which leapt 44 per cent.
Some analysts had expected Vodafone to write off up to £25 billion from its balance sheet, to hack away at a mountain of goodwill mainly accumulated with its blockbuster purchase of Germany's Mannesmann two years ago.
Vodafone shares rallied 7 per cent to 111-1/2 pence as investors focused on the key operating performance indicator of earnings before interest, tax, depreciation and amortisation.
That jumped to £10.093 billion in the year to March 31st, at the top of a range of forecasts between £7.4 billion to above £10 billion.
Full-year turnover climbed 52 per cent to £22.845 billion, and the company said it expected double-digit revenue growth and a further increase in its earnings margin this year.
Vodafone Ireland maintained a market share of over 56 per cent, with year end registered customer numbers at 1,704,000, representing growth of 10 per cent since acquisition in May 2001.