3M lowers its full-year forecast under the impact of a strong dollar

Anticipating a sharp blow from rising inflation, 3M is changing its own full-year revenue and profit forecast, expecting to get lower numbers than previously predicted. The reason for the change is also a significant drop in overseas earnings due to a stronger dollar. In this regard, the shares decreased by 2%.

While earlier revenue growth was projected to decline by about 0.5-2.5% and adjusted earnings per share were expected to be around $10.1-10.35 for the year, the company's new projections show growth declining by about 3-3.5%, with adjusted earnings ranging from $10.3-10.8.

The company has subsidiaries in more than 70 countries and generates more than half of its revenue outside the United States. Thus, a sharp rise in the dollar could have an adverse effect on its revenues.

There are reasons for the company to believe that its revenue will decline. 3M sees high inflation is forcing customers to give up some high-priced items (mostly appliances and electronics) in favor of necessary products.