GBAF Logo
Global Banking & Finance Awards® 2026 Nominations open, free to enter Nominate now →
European majors set for Q3 earnings growth despite darkening view on consumer cyclicals - Finance news and analysis from Global Banking & Finance Review
Finance

European majors set for Q3 earnings growth despite darkening view on consumer cyclicals

Published by Global Banking & Finance Review

Posted on October 16, 2026

2 min read

· Last updated: October 16, 2026

Add as preferred source on Google

European Majors Anticipate Q3 Earnings Growth Despite Consumer Sector Weakness

Q3 Earnings Outlook for European Companies

Oct 16 (Reuters) - Major European companies are expected to report strong earnings growth in the third quarter, although analysts slashed estimates for cyclical consumer products such as cars over the past week, the latest LSEG I/B/E/S data showed late on Thursday.

Aggregate Earnings and Revenue Forecasts

Companies on Europe’s benchmark STOXX 600 index are expected to report quarterly earnings growth of 20.7% on aggregate, led by energy companies that benefit from supply disruptions caused by the Iran War and Ukrainian drone attacks on Russian refineries.

That is slightly below last week’s forecast of 21%. Analysts raised their revenue forecasts, with sales now expected to grow 11.0% on average, up from 10.6% a week ago.

Sector Performance Breakdown

Consumer Cyclicals: Facing Headwinds

The consumer cyclicals sector, which includes automakers and luxury firms, is now expected to post a 2.6% fall in quarterly earnings, compared with forecast growth of 26% last week.

The downgrades follow falling third-quarter deliveries at Volkswagen and BMW mainly due to slumping demand in China, with VW posting its steepest drop in more than four years.

Energy and Technology: Offsetting Weakness

Higher estimates for energy and technology, however, offset most of the downgrade. The energy sector's forecast rose to 124.0% from 115.9%, and the tech industry's to 32.7% from 24.4%, after chip equipment maker ASML and telecoms equipment provider Ericsson beat market estimates.

Expert Insights and Upcoming Reports

Analyst Perspectives

"We expect a real dichotomy in earnings," Michael Field, Morningstar's EMEA equity strategist, said on Wednesday, adding that companies exposed to high energy prices and weak consumer sentiment may struggle.

Key Companies to Watch

Upcoming Earnings Announcements

Next week, investors will be closely watching results of software maker SAP, engineering group ABB and British lender Barclays, among the 44 STOXX 600 companies due to report.

(Reporting by Rafal Nowak in Gdansk, editing by Milla Nissi-Prussak)

Key Takeaways

  • Third‑quarter earnings for STOXX 600 firms are now projected to grow 20.7%, slightly below last week’s 21% forecast, with revenues up to 11.0% from 10.6%. (uk.marketscreener.com)
  • Consumer cyclicals, including automakers and luxury names, are now expected to see a 2.6% earnings decline—revised down from a projected 26% growth just a week ago. (uk.marketscreener.com)
  • Volkswagen reported a 14.3% global delivery drop in Q3, its sharpest fall in over four years, with China deliveries plunging 38.5%, while BMW’s Q3 deliveries fell 6.3% as China sales collapsed 24.8%—weighing heavily on sector outlooks. (live.euronext.com)
  • In contrast, energy sector earnings growth forecasts rose to 124.0% from 115.9%, and tech sector forecasts climbed to 32.7% from 24.4%, as firms like ASML posted record Q3 performance. (reddit.com)
  • Investors will focus next on upcoming Q3 results from SAP, ABB and Barclays among others, which could validate this bifurcated earnings landscape. (uk.marketscreener.com)

References

Frequently Asked Questions

What is the expected earnings growth for major European companies in Q3?
Companies on Europe's STOXX 600 index are expected to report 20.7% earnings growth in the third quarter.
Which sectors are driving Q3 earnings growth in Europe?
Energy and technology sectors are leading the growth, with energy sector forecasts rising to 124%.
Which companies are investors monitoring for upcoming Q3 results?
Investors are watching SAP, ABB, and Barclays among 44 STOXX 600 companies set to report next week.

Tags

Related Articles

More from Finance

Explore more articles in the Finance category