Goldman Sachs reports that the current European earnings season is producing results that, on balance, exceed expectations. About two-thirds of the components of the STOXX Europe 600 have released results so far, and average earnings-per-share (EPS) surprises are running at roughly 3%, a touch above the long-run average.
At the index level, first-half EPS growth is tracking at about 13% year-over-year. Goldman Sachs notes this is the strongest growth pace recorded in three years. That outcome has emerged despite a renewed energy supply shock that affected the region.
When stripping out commodities, the bank estimates EPS growth of roughly 7%. The median STOXX 600 stock is delivering earnings growth of around 7% year-over-year, a rate close to the median stock in the S&P 500, according to the same measure.
Sector-level revisions have been predominantly positive. Since the start of reporting, all sectors except Basic Resources and Consumer Discretionary have seen upward revisions. Technology, Financials and Commodities have registered the most pronounced positive surprises. By contrast, consumer-facing sectors have been the primary source of disappointment, reflecting softer demand trends.
Earnings sentiment - defined here as the percentage of companies with earnings revised up minus the percentage revised down - has climbed to its highest reading in over three years. Over the past month, only about one-third of STOXX 600 companies have experienced downward revisions, while more than half have seen upgrades.
Market reactions to results have also been more pronounced than historical norms. On average, beats and misses have moved share prices by roughly 2% on the day of results, with gains or losses reflecting whether reports beat or missed expectations.
Goldman Sachs highlights that a number of AI-exposed technology names - including ASML, Nokia and ASM International - beat expectations but were not rewarded by the market on their results days. The bank's analysis therefore shows pockets where market responses diverged from the headline beat-or-miss pattern.
Data and caveats
All figures and sector observations in this report are reported as described by Goldman Sachs' assessment of the current European reporting season. Where the source frames metrics such as EPS surprises, first-half growth, and sector revision patterns, those are retained here without alteration.