European stocks' earnings season "Black Thursday"? Maersk's profit halved, Volvo plunged 14%, Vodafone's revenue fell short of expectations

European stock markets encounter “Black Thursday” as several industry giants release disappointing earnings reports, severely damaging market sentiment. From shipping, automotive to telecommunications sectors, core companies not only underperform expectations but also issue pessimistic profit guidance, leading to heavy sell-offs of related stocks.

Global shipping giant Maersk’s stock once plunged by 7%, as the company warned that freight rates are facing deterioration as the Red Sea route gradually reopens. Maersk expects profits this year to be significantly halved compared to 2025, a forecast well below analysts’ consensus, directly fueling concerns about the global trade environment.

The automotive and telecom sectors are similarly affected. Volvo’s stock plummeted 14%, marking a poor performance, as Q4 revenue fell short of expectations, with tariff pressures and fierce price wars severely eroding profit margins. Meanwhile, telecom giant Vodafone’s shares declined 4.6% due to sluggish growth in its largest German market service revenue, indicating that the company’s CEO’s transformation plan still faces resistance.

Maersk’s profit guidance halved

According to Bloomberg, Maersk stated on Thursday that it expects EBITDA for this year to be between $4.5 billion and $7 billion. This figure is not only far below the $9.53 billion recorded in 2025 but also below the analyst average estimate of $5.76 billion.

Maersk pointed out that the downward revision in performance guidance is mainly based on the expectation of the gradual reopening of the Red Sea route. According to Global Times, previously, due to Houthi attacks, container shipping had to reroute around southern Africa, adding extra transit time, which effectively reduced global capacity by about 7% to 8% amid fierce competition for cargo. However, as the situation in the Red Sea changes, freight rate benefits are fading.

In the face of a challenging market environment, Maersk announced it will focus on cost discipline. The company plans to cut 1,000 jobs, accounting for about 15% of its corporate functions, but less than 1% of total employees. The company expects annual cost savings of $180 million. Additionally, Maersk forecasts global container trade growth of 2% to 4% this year.

Industry consultancy Alphaliner’s data shows that the top five global container shipping companies have nearly 7 million TEUs of order capacity to be delivered in the coming years, accounting for about 20% of the current global fleet, indicating significant supply-side pressure.

Volvo’s profit margins under pressure

Volvo experienced a tough quarter, with its stock dropping 14% after earnings were released. Due to tariffs, increased discounts, and a strengthening Swedish krona, the company’s Q4 profitability was severely impacted, with an EBIT margin of only 2%, and revenue also below analyst expectations.

CEO Hakan Samuelsson told Bloomberg TV, “We are facing a very tough market.” He pointed out that the US cancellation of EV incentives is hindering sales. To counteract EU import tariffs on electric vehicles, Volvo has had to adjust its production layout, shifting output to factories in South Carolina and Belgium.

Despite disappointing results last year, Volvo has set targets to achieve higher sales and free cash flow by 2026. Samuelsson emphasized that new models, including the EX60 electric SUV, are central to its turnaround efforts. The vehicle has received “very successful” initial orders and is seen as a new beginning in the company’s full-electric segment.

Vodafone Germany market growth stalls

UK telecom operator Vodafone reported that organic service revenue growth in Q3 did not meet expectations, causing its stock to decline. According to Bloomberg, the group’s overall organic service revenue grew 5.4%, below the analyst forecast of 6.03%.

In Vodafone’s largest market, Germany, organic service revenue grew only 0.7%, short of the 1.02% expected by analysts. Although the company introduced 1&1 AG as a wholesale customer to boost sales, and regulatory changes banning bundled TV packages by housing associations in Germany have mostly ended, fierce market competition still dragged down performance. Additionally, organic service revenue in the UK fell 0.5%, well below the 1.59% growth forecast.

CEO Margherita Della Valle’s ambitious transformation plan, underway for over two years, focuses on streamlining operations and asset divestments, including exiting Italy and Spain, and merging with CK Hutchison Holdings’ Three in the UK. While analysts appreciate its focus on key markets, recent earnings show that the path to recovery in core markets remains long.

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