Europe's companies under pressure: decline in sales and profits alarms!

Europe's companies under pressure: decline in sales and profits alarms!

European companies are facing increasing pressure in global competition. A recent study by EY, which analyzed the balance sheets of the 1,000 top-selling listed companies worldwide, shows that economic performance in Europe lags behind the growth of US and Asian companies. According to the study, U.S. companies' sales increased an average of 4.5% in 2024, while Asian companies saw an increase of 3.2%. In contrast, Europe's large companies suffered a 1.1% decline in sales.

A particularly worrying trend is the decline in profits among European companies, which amounts to 6.5%. German companies in particular performed poorly in this analysis: they suffered a 3.1% decline in sales and an 8.5% decline in profits. These results show that Europe's traditional strengths, particularly in the industrial sector, are threatened by numerous challenges, including weakening industries, geopolitical tensions and tariff burdens.

US and Asian dominance

The study also highlights that the group of top 1,000 companies by revenue is clearly dominated by the US, which ranks 317 companies. China follows with 137 and Japan with 110 companies. Germany has 43 companies in this global context. In the list of the most profitable companies worldwide, not a single company from Europe is represented in the top ten. Instead, the seven highest-profit companies come from the US, including giants like Apple, Alphabet, Microsoft and Nvidia. At the top is Saudi Aramco with a profit of around $191 billion.

The leading European company in this ranking is Shell, which is in 13th place, followed by Deutsche Telekom in 19th place with a profit of over 26 billion euros. These figures highlight the difficulties faced by European companies, particularly when compared to their American and Asian competitors.

Top-selling companies in 2024

Another aspect of the study is the list of the companies with the highest sales in 2024. Walmart, Amazon and Saudi Aramco dominate this ranking. In terms of German companies, Volkswagen, Mercedes-Benz, BMW and Deutsche Telekom can be found in positions 9, 35, 36 and 50. These positions reflect the challenges facing the domestic industry in international competition.

Jan Brorhilker, an expert at EY, emphasizes that Europe's strength in the industrial sector is increasingly becoming a challenge, especially in the automotive sector. Given these trends, it will be crucial how European companies respond to changing market conditions and what strategies they develop to avoid falling further behind in global competition. Further information can be found at Eurostat.

For detailed insights into the topic and analysis of the current challenges for European companies, the full study by EY is recommended. t-online.de also provides further information on the results of the study.