According to Allianz Trade, while 62 percent of companies in Europe and the USA exceeded forecasts in the first quarter, this is mainly due to already lowered analyst estimates. Even though revenues increased year on year (+2.6 percent), profit growth remained at a negative level (-0.1 percent y/y), and the recession of private companies is getting closer, at least in the United States, where profits have already declined for two consecutive quarters.
As expected, two sectors, particularly the maritime and energy sectors, experienced a significant quarterly decline due to profit normalization. In total, 10 out of 26 sectors managed to increase both sales and earnings per share (EPS), while eight sectors recorded year-on-year declines. Basic materials fared the worst.
Corporate forecasts for the entire year 2023 have worsened, as only 25 percent of companies made upward adjustments during the season. However, a mild recovery is expected from the beginning of next year.