LSEG: Eurozone Earnings Outlook Improves to 1.1% Q4 Drop vs 3.1% Expected, STOXX 600 Revenue Forecast at 3.4%

The LSEG I/B/E/S survey shows European corporate outlook improving, with the average Q4 earnings contraction expected to narrow to 1.1% from 3.1% as blue-chip indices reach key highs. This follows a 60% improvement-to-estimate rate in the current earnings season, compared to the typical 54%. However, revenue outlooks deteriorated, projecting a 3.4% year-over-year decline for the STOXX 600 versus 3.2% last week. The Q4 contraction would remain the worst in the past seven quarters. The earlier slump followed Trump's 2023 tariff announcements, which depressed expectations from roughly 11% growth to as low as -4.2% in January.