The number of profit warnings issued by public companies rose by 20% to 59 in the second quarter of 2025, according to research amid growing concerns over international tensions.
Geopolitical uncertainties were named as a key factor behind nearly half (46%) of warnings to investors. EY, which has compiled the data for 25 years, said this was the highest percentage recorded for those mentioning this issue.
Industrial support services and retail sector companies were responsible for a large number of the warnings in the second quarter, registering eight and four profit warnings respectively.
Businesses have faced an increase in labour costs this year after the rise in national insurance contributions for employees in April, which coincided with increases to both the national minimum wage and the national living wage.
Among those issuing profits warnings in the quarter was Macfarlane Group, the Glasgow-based packaging group.
There was a rise in profit warnings after the US threatened to impose wide-ranging tariffs on imports in April.
Jo Robinson, turnaround and restructuring strategy leader at EY, said: “The latest profit warnings data reflects the scale of persistent uncertainty and how heavy it continues to weigh on UK businesses.
“While the announcement of global tariffs has clearly played a part in amplifying uncertainty, they are just one factor among broader geopolitical and policy upheaval.
“These pressures are often interlinked and, combined, they are having a significant effect on companies’ confidence, decision-making and spending.
“Whether the rise in profit warnings is cyclical or structural remains to be seen and we still expect earnings pressure to ebb and flow with the macroeconomic backdrop.”
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