Earnings Season Monitor – Up, Up and Away

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August 7, 2026 03:45 PM GMT

European Equity Strategy | Europe

Morgan Stanley & Co. International plc+

Regiane Yamanari

Equity Strategist

Earnings Season Monitor – Up,

Up and Away

Marina Zavolock

Equity Strategist

Leoni Externest, CFA

Equity Strategist

With c.94% of market cap reported, Europe is closing out its

strongest earnings season in years: net weighted skew to beats

at +48% & +23% to NTM EPS upgrades. Strength has been

broad-based, and consensus continues to move higher – 2026

Europe EPS growth is now 17.8%, ex-Energy at 14.0%.

Key Takeaways

The strongest season in years. Our analysts' reaction to earnings data shows a

Morgan Stanley India Company Private Limited+

Jitiksha Shah

Equity Strategist

Karthik Nityanand

Strategist

Morgan Stanley & Co. International plc+

Emily A Woods

Equity Strategist

+48% net weighted skew to beats (vs +26% in 1Q) & +23% to NTM EPS

consensus upgrades post results (vs +6%).

Exhibit 7 : Semis, Aerospace, Cap Goods &

At the sector level, Semis, Food & Bev, Div Fins & Aerospace have led the net

Banks lead on earnings revisions breadth

skew to beats and positive guidance, with the overall skew positive across most

European Sectors FY2 Earnings Revision Ratio (FFMCap Weighted)

sectors.

Consensus continues to move higher. 2026 Europe EPS growth is now 17.8%,

with ex-Energy at 14.0%. Semis, Banks, Cap Goods and Aerospace are among the

leaders on revisions breadth.

The positive skew to beats and NTM EPS upgrades still lags the US, but by

significantly less than in prior seasons. Earnings revisions breadth has also

strengthened, with the US only modestly ahead of Europe.

Lists based on management sentiment score change inside (Exhibits 33 & 34 ) –

Semis & Equip

Aerospace

Cap Goods

Banks

Chemicals

Luxury

Div Fins

Utilities

Tech H/W

Life Sciences

Food & Bev

Energy

Real Estate

HPC

Tobacco

Transport

Defence

Construction

Pharma

Discret. Retail

Bus. Svcs

Telecoms

Insurance

Travel & Leisure

M&M

Autos

Medtech

Media & Ent.

Food Retail

Software & Svcs

P&P

Europe

OW

-80 -70 -60 -50 -40 -30 -20 -10 0

EW

UW

Note: Based on 45D consensus window; Source: LSEG Data & Analytics,

…