US Multinational Companies Reveal Substandard Corporate Earnings Due to Europe’s Lagging Economy

US multinational companies have reported substandard corporate earnings, as many of the companies have been facing a decline in sales within Europe, greatly attributed to Europe’s lackluster economy.

According to a recent Wall Street Journal article, multinational company, Whirlpool, announced a $35 million operating loss in Europe (combined with the Middle East), and International Business Machines Corp. (IBM) was hit with a 5% decline in revenue in Europe. Kimberly-Clark Corp. is actually planning to stop selling one of their leading products (diapers) within Western and Central Europe, as the company admitted to earning no profit within the region.

Interestingly, the WSJ also reported that US multinational companies expect to generate 20% to 25% of their total sales in Europe. However, expectations have clearly not been met. With Europe’s economy currently lagging, we will see companies having to make up this lost revenue elsewhere.

Read the full WSJ article here: http://online.wsj.com/article/SB10001424052970204530504578076771035763116.html

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About Jessica Summers

My name is Jessica Summers. I graduated as valedictorian from Marymount Manhattan College in 2012 with a B.A. in Communications and minors in Journalism and Political Science. During college, I spent a summer abroad studying at Oxford University and also held internships at CNN International, CNBC Business News, and WABC-TV, among other news organizations and media outlets. I am currently a graduate student at New York University’s Business and Economic Reporting program. I am an aspiring broadcast journalist, especially interested in covering the world of business and finance.
This entry was posted in Multinational Companies, The Global Economy. Bookmark the permalink.

One Response to US Multinational Companies Reveal Substandard Corporate Earnings Due to Europe’s Lagging Economy

  1. Spencer says:

    I expect trade with Latin Anerica to increase significantly over the next decade as a result of the declining European economic climate. Trade deficits grow as a result of declining economic activity and weak labor markets. It is one of the main reasons companies are either losing money or breaking even in the most recent quarters, European consumers are not able to buy foreign made goods like they have in the past. The Latin American markets are as large, if not larger, than the Chinese and east pacific regions, and are hungry for economic growth and prosperity. I believe we can make up the deficits in Europe trade by expanding cooperation and trade agreements with Latin America. Not only would this benefit te economies involved, it would be a huge source of jobs, leading to a significant recovery in the American labor market. Gov. Romney has made this a center piece of his economic campaign, and I think he has a very sound point.

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