Headlines
European Q2 corporate profit outlook improves further
Published by Global Banking and Finance Review
Posted on August 12, 2025
2 min readLast updated: January 22, 2026
Global Banking and Finance Review
Company
Published by Global Banking and Finance Review
Posted on August 12, 2025
2 min readLast updated: January 22, 2026
European corporate earnings forecast improves to 4.8% growth in Q2, driven by trade deals and tariff truces. Technology sector leads with 26% growth.
By Javi West Larrañaga and Marleen Kaesebier
(Reuters) -The outlook for European corporate health has considerably improved, the latest earnings forecasts showed on Tuesday, showing a continued rise after the extension of the U.S.-China tariff truce and the EU-U.S. trade deal.
European companies are expected to report 4.8% growth in second-quarter earnings, on average, according to LSEG I/B/E/S data. That is above the 3.1% rise analysts had expected a week ago.
Market sentiment has steadily improved in recent weeks, after the European Union struck a framework deal with the United States in July and the U.S. and China extended their tariff truce for another 90 days on Monday.
Following U.S. President Donald Trump's plans for tariffs on all countries in February, second-quarter earnings expectations of STOXX 600 companies had gone from a 9.1% year-on-year increase right before the announcement to a 0.7% fall before the signing of the U.S.-EU deal.
They have considerably increased in the weeks since Brussels and Washington agreed on the 15% import tariff on most EU goods, half the threatened rate.
The consensus forecast for second-quarter revenue has also continued to improve, the LSEG report showed, with analysts now expecting a 1.3% fall compared to a 2.0% drop last week.
Out of ten sectors in the European benchmark index, four are expected to see a year-on-year improvement in quarterly earnings. The technology sector is expected to have the highest growth rate at 26%, followed by healthcare, financials and industrials.
Earnings of Danish wind turbine maker Vestas later this week could show how European renewable companies are dealing with tariffs and the increased uncertainty in the United States. On Monday, wind farm developer Orsted asked shareholders for $9.4 billion to cope with Trump's hostility to wind power.
(Reporting by Javi West Larrañaga and Marleen Kaesebier in Gdansk, editing by Milla Nissi-Prussak)
European companies are expected to report an average growth of 4.8% in second-quarter earnings, according to LSEG I/B/E/S data.
Market sentiment has improved steadily in recent weeks after the European Union reached a framework deal with the United States and the U.S. and China extended their tariff truce.
The technology sector is expected to have the highest growth rate at 26% year-on-year for the second quarter.
The consensus forecast for second-quarter revenue has improved, with analysts now expecting a 1.3% fall compared to a 2.0% drop the previous week.
Earnings from Danish wind turbine maker Vestas could provide insights into how European renewable companies are managing tariffs and uncertainty in the United States.
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