Report
Why have corporate earnings recovered so quickly after the COVID crisis?
We look at the situations of the United States and the euro zone. Whether we look at the earnings of all companies or those of listed companies, we see a very rapid upturn in earnings after the COVID crisis, even though underemployment remains significant. How have companies managed to restore their earnings so rapidly? First, we must separate out operating results from any government support. We see that the upturn in earnings stems primarily from operating results in the United States and primarily from government support in the euro zone; To restore their earnings, companies may have been able to: Curb wages; Increase their selling prices; Make productivity gains; Cut various costs (travel, real estate, etc.). We see faster productivity gains in the United States and the euro zone and faster increases in the value added deflator only in the United States, which explains the difference between margins.
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Natixis
Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.
Patrick Artus
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