Earnings season has kicked off in Europe , and the impact of U.S. tariffs are beginning to show up in the hard numbers. That has now made analyst consensus — which just last week predicted a mild 0.2% dip in profits for companies on the Stoxx Europe 600 index — forecast a 0.7% year-over-year decline, according to LSEG data. The gloomier forecast comes as a growing number of European industrial and consumer giants report that tariffs are hitting sales, raising costs, and cooling the investment environment. Manufacturing The auto industry is on the front lines of the trade conflict. Jaguar Land Rover said its retail sales plunged 15.1% in the quarter ending June 30. The British carmaker, owned by India’s Tata Motors , attributed the slump to a “pause in shipments to the US during April 2025 following the introduction of US import tariffs.” Similarly, Sweden’s Volvo Group is scaling back its North American operations in response to weak demand. “Demand in North America has been weak in the wake of uncertainty surrounding both tariffs and the [Environmental Protection Agency] 2027 emissions regulations,” said Martin Lundstedt, chief executive of the truckmaker, confirming the company is “reducing production capacity there to adapt.” The uncertainty from the trade war has also led to customers of major companies to delay purchases. Norway’s Tomra Systems , which makes machines used in recycling waste, said its order intake has been affected by “macroeconomic and tariff uncertainty which is postponing customers’ investment decisions.” This sentiment was echoed by Swiss industrial giant ABB , which noted that customers for its robotics division are in a “wait-and-see mode on the back of continued tariff-related uncertainties,” causing some projects to be delayed. However, across the group, ABB had record second-quarter orders. Consumer goods For other companies, tariffs are translating directly into higher costs. Consumer-goods maker Essity , which produces incontinence pads under the brand TENA, reported that while it managed to raise prices, it was to offset “increased costs of goods sold, including trade tariffs.” Barry Callebaut , the world’s largest chocolate maker, cited “particular tariff-related uncertainty in North America” as a factor in its 9.5% third-quarter volume drop, forcing it to revise its full-year guidance downwards. Even Europe’s financial sector does not appear to be immune. Nordea Bank said its market-making business was “impacted by volatility due to tariff uncertainty,” while Investor AB noted that the profit margins of its medical-device subsidiary Molnlycke were squeezed by a “smaller negative impact from tariffs.” Tariffs ‘fully offset’ Not all companies are equally affected, however. Industrial group Sandvik reported a “swift response to tariffs, fully offset in the quarter.” Swiss pharmaceutical giant Novartis also said tariff are not expected to hit its finances this year. “We have adequate inventory in the U.S. for this year and feel fully confident that for this year any tariffs would not impact our guidance,” Vasant Narasimhan, chief executive of Novartis, told CNBC’s Karen Gilchrist. “We’re moving as fast as possible to ensure over the next few years we’re able to produce all our medicines for the U.S. in the U.S. and fully mitigate tariffs.” — CNBC’s Karen Gilchrist contributed reporting.
Read More: Impact of tariffs starting to show up in European companies’ earnings