Shulou(Shulou.com)05/31 Report--

The financial reporting season began in full swing in the second quarter of this week, but so far, the reporting company has shown a trend. The strength of the dollar is eating into corporate profits.

Factual data show that in the s & p index; P 500 companies reported that so far, 5% of companies said the strong dollar was a headwind for their business in the second quarter, and the company analyzed the factors affecting its revenue through company conference calls.

The dollar index has been rising since mid-2018. A stronger dollar is usually bad news for companies with large overseas sales because it makes exports less attractive. This is due to the negative impact of the trade war between the United States and China, resulting in higher tariff costs.

Investors are bracing for a brutal earnings season, as 77% of companies with pre-announcements say their profitability will be worse than Wall Street expected. According to FactSet, S & P's total revenue; the S & P 500 is expected to fall 3 per cent in the second quarter.

"historically, when the dollar has strengthened year-on-year, a downward correction is the norm," Lori Calvasina, head of equity strategy at Royal Bank of Canada, said in a report on Monday. "We think profit sentiment may bottom out in July / August, but we don't think so yet and there will be more downside adjustments."

"unfavorable currency"

Levi Strauss, one of the world's largest jeans sellers, last week announced better-than-expected second-quarter earnings. However, newly listed companies attributed the decline in net profit and profit margins to a "stronger dollar" and "adverse currency effects".

Helen of Troy, a consumer goods maker, also felt the pain. Last week, the company said the increase in its online sales had been offset by a decline in international sales, with "the adverse impact of foreign currencies being about $2.5 million or 0.7 per cent".

Brian Grass, the company's chief financial officer, said on the earnings call: "compared with the same period last year, the average exchange rate is generally negative, which has a negative impact on net sales and gross margin.

Welcome to subscribe "Shulou Technology Information " to get latest news, interesting things and hot topics in the IT industry, and controls the hottest and latest Internet news, technology news and IT industry trends.