March 5 (Reuters) - Estimates for European blue-chip companies' fourth-quarter earnings have gotten slightly worse, the latest LSEG I/B/E/S data showed on Thursday. Year-on-year earnings of major
European corporate profits head for two-year low
Analysis of European Blue-Chip Earnings and Market Trends
March 5 (Reuters) - Estimates for European blue-chip companies' fourth-quarter earnings have gotten slightly worse, leaving them on track for their worst earnings season in the past two years, the latest LSEG I/B/E/S data showed on Thursday.
Fourth-Quarter Earnings Performance
Year-on-year earnings of major European companies were expected to have declined 0.4% in the final quarter of 2025, based on results from 229 STOXX 600 companies and market estimates for those that are yet to report, the data showed. That was worse than the 0.1% decline expected last week.
Revenue Estimates and Corporate Resilience
- Estimates for revenues have sharply deteriorated, with the data now pointing to a 4.2% year-on-year decline compared to last week's 2% fall
- Still, European corporates have proved more resilient than previously expected, as forecasts at the end of January were anticipating 4% year-on-year declines.
- About 56% of the 229 STOXX 600 companies that have reported earnings have exceeded market estimates.
Market Projections and Global Trade Impact
- Projections for STOXX 600 company results sharply deteriorated after months of trade upheaval since U.S. President Donald Trump took office.
- Q4 earnings of European blue-chips were forecast to grow as much as 11.1% in February 2025, before Trump announced plans for global tariffs.
Comparison with U.S. Blue-Chip Companies
Performance Gap Between Europe and the U.S.
- European majors have considerably lagged U.S. counterparts, according to a separate LSEG report published on Friday.
- U.S. blue-chips' earnings growth in the fourth quarter is estimated at above 14%, based on results from 479 of the S&P 500 companies and estimates for the rest.
Analyst Outlook
- "We continue to expect stronger growth in the U.S. than in Europe over H1, but see European earnings catching up in the second half of the year," Deutsche Bank analysts said in a note on Tuesday.
(Reporting by Javi West Larrañaga; Editing by Milla Nissi-Prussak and Matt Scuffham)
