European companies cut profit forecasts amid US tariff uncertainty

Uncertainty in trade relations between the United States and the European Union has negatively impacted the financial outlook of European companies. According to LSEG I/B/E/S data, average Q2 profit expectations have been revised downward to -0.2% year-on-year. Back in February, before US President Donald Trump announced new tariffs, analysts had projected 9.1% growth.

Revenue forecasts have also deteriorated. Experts now anticipate a 3% decline, compared to a 2.2% drop just a week earlier. This revision follows prolonged negotiations between the EU and the US administration regarding potential exemptions for European countries from the new tariffs.

Despite this, markets remain relatively resilient. The STOXX 600 index has gained nearly 7.1% since the beginning of the year. Companies from Ireland and Poland are expected to deliver the strongest results, with projected profit growth of 85.4% and 67.4%, respectively. Meanwhile, Norway and Germany are seeing weaker business performance, likely leading to profit declines of 9.7% and 7.8% in these countries.