Piazza Affari, profits with the handbrake pulled: recovery only in 2026

It has been a year lived in the twilight for the profits of European and Italian companies, which remain far from the spotlight that has long been on the stars of Wall Street and the technology sector in particular, but are also ready to take their revenge in the twelve months that lie ahead. The confirmation will in all likelihood come from the quarterly earnings season, which is set to get into full swing next week on this side of the Atlantic and in our country. The fourth-quarter data will conclude a 2025 in which the companies that make up the pan-European Stoxx 600 index have trimmed their earnings by 1 per cent year-on-year to EUR 741.8 billion, according to the most up-to-date forecasts compiled among analysts by Lseg I/B/E/S.

Uncertainty over tariffs, the mini-dollar headwind and, above all, a growth engine that has been beating at the head throughout the year are certainly the main factors that have conditioned profitability for European companies, once again marking the difference compared to the US. Some of these restraining factors could, however, at least partially dissolve in 2026, thanks mainly to the expansive fiscal plans envisaged in key countries such as Germany and the heavy investment needed in the defence sector and to create the necessary infrastructure for data centres. All this would, again according to Lseg I/B/E/S, propel a gradual acceleration in European corporate earnings momentum, which could culminate in a year-on-year advance of 13.2% in the fourth quarter.

Italy is certainly no exception to the continental panorama, and projections for the whole of 2025 drawn up for Il Sole 24 Ore by Intermonte indicate an aggregate value for corporate profits of the main listed companies in our country (around 120, for a total capitalisation equal to 90% of the entire list) of 73.8 billion. On balance, this is a drop of 1.9 per cent compared to the previous year, which is, however, largely due to the haemorrhaging of profits suffered by Stellantis: if the forecasts are confirmed, the car manufacturer is expected to fall to 1.9 billion compared to 7.4 billion in 2024 and more than 20 billion in the previous two golden years. Without this effect, the annual balance sheet of the quoted companies on the Milan list would even be positive by almost 6%, thanks mainly to the boost from the financial sector, which should see profits grow by 11% to almost 30 billion.

The most interesting indications, however, come from the current year, during which a trend reversal is expected in Italy as in the rest of Europe. In fact, Intermonte projects Piazza Affari's 2026 earnings figure at EUR 81.6 billion, which corresponds to a 10.6% increase compared to the year just ended: "A cyclical recovery that derives above all from a normalisation of profits in some sectors that have been penalised in the last two years," emphasises Alberto Villa, head of the Milanese Sim's research office, with particular reference to industrial and consumer-oriented companies. The movement will be led in many respects by Germany, whose awakening is 'capable of dragging a number of supply chains involving Italian companies and of obviating a geopolitical context that retains many elements of uncertainty'.

The aforementioned currency issue, with the euro-dollar exchange rate worrying again after the flare-up in recent days and which Intermonte actually expects to see stabilised in the 1.15-1.17 area, represents, together with the possible rise in energy raw materials (which would, however, also favour the numerous stocks in this sector present in Piazza Affari), the main unknown factor. Lastly, the contribution of the banking world should not be absent from the roll-call, which is likely to see a stabilisation in profits after the vertiginous, double-digit advance of recent years and will focus attention on the numerous industrial plans expected to be renewed in the next few days: from Intesa Sanpaolo to Fineco, passing through Bper and Monte dei Paschi.