Corporate giants doing business abroad are painting a dreary picture of the world's economy.
With an ongoing trade war between the U.S. and China, Brexit uncertainty weighing on Europe and the U.K., and new weakness out of Japan, some business leaders say it's harder than ever to rake in profits.
This week, top executives at FedEx, BMW, UBS and others described bleak global business conditions while discussing quarterly results. Fitch Ratings also "aggressively" cut its forecast for the year.
The head of UBS was among the latest to blame the world's backdrop for weaker-than-expected results. CEO Ermotti told a conference in London on Wednesday that it "one of the worst first-quarter environments in recent history," Reuters reported. The Swiss bank slashed another $300 million from 2019 costs after revenue at its investment bank plunged. Investment banking conditions are among the toughest seen in years, especially outside the U.S., he said.
Ermotti's remarks echo the sentiment from FedEx a day earlier. The multinational package delivery service reported sluggish international revenue on Tuesday as a result of tough exchange rates and ongoing trade battles.
"Slowing international macroeconomic conditions and weaker global trade growth trends continue, as seen in the year-over-year decline in our FedEx Express international revenue," Chief Financial Officer Alan B. Graf Jr. said in FedEx's quarterly earnings report.
BMW is another with a less-than-rosy outlook. The German automaker said it expected pretax profit to fall by more than 10 percent in 2019, and its CFO said global conditions make it hard to provide a clear forecast.
"Depending on how conditions develop, our guidance may be subject to additional risks; in particular, the risk of a no-deal Brexit and ongoing developments in international trade policy," CFO Nicolas Peter said in BMW's quarterly earnings report Wednesday.
Samsung also joined in on Wednesday. The electronics company is forecasting a tough 2019 due to slowing economic growth, global trade tensions and softer demand for memory chips from data center companies, the firm's co-chief executive said Wednesday.
"We are expecting many difficulties this year such as slowing growth in major economies and risks over global trade conflicts," Samsung Co-Chief Executive Kinam Kim said.
It's not just these big names — all companies in the S&P that generate more than half of their sales overseas are expected to see an earnings decline of 11.2 percent in the first quarter of 2019, according to FactSet.
Fitch Ratings also "quite aggressively cut" its 2019 global forecast this week. But the firm's economics team stopped short of calling a global recession.
"Global growth prospects have deteriorated significantly since Fitch Ratings' last Global Economic Outlook (GEO) in December 2018," the agency said in a report published Wednesday. "We do not see the onset of a global recession."
Fitch dropped its global growth forecasts for 2019 to 2.8 percent from 3.1 percent. For 2020, it dropped from 2.8 percent from 2.9 percent. The euro zone growth outlook weakened "particularly sharply," Fitch said. It also highlighted a slowdown in China, and deceleration in emerging markets led by Turkey and Argentina in the aftermath of last summer's currency crises.
"This has occurred against the backdrop of world trade growth weakening steadily through 2018," Fitch said. "The US-China trade war may have suppressed and distorted trade flows, but more fundamentally, weaker EM domestic demand has been a key contributor to the trade slowdown."
Washington and Beijing are locked in a stalemate on tariffs. In the past year, the world's two biggest economies have slapped billions of dollars' worth of tariffs on each other's goods. The tensions have taken a toll on global financial markets and kept investor sentiment in check.
There were multiple reports this week about progress on negotiations.
On Wednesday, President Donald Trump said U.S. tariffs on Chinese goods could stay on "for a substantial period of time," but he added that the talks were "coming along nicely."
Earlier, Bloomberg reported that some U.S. officials fear China is reneging on certain trade concessions. The Wall Street Journal reported that U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin plan to travel to Beijing next week for another round of negotiations with their Chinese trade counterparts.
Then there's Brexit. The ongoing confusion and uncertainty around the U.K.'s departure from the European bloc is hanging over global markets. Some fear the U.K. would default to World Trade Organization rules, which would mean heavy import and export tariffs and possible delays to goods at the border.
In January, the CEO of Adidas called Brexit the "biggest concern" for the company for its potential ripple effect on the European economy. Europe is about 30 percent of the German sportswear maker's business.
Japan added to the heap of worries this week. For the first time in three years, the Japanese government downgraded its assessment of the economy, blaming the U.S.-China trade war for slumping exports and industrial output.
Despite uncertainty, some luxury retailers seem to be holding up. Hermes, known for its $10,000 Birkin handbags, said Wednesday it sees no change in its positive sales trend and was helped by strong demand from clients in Asia. Hermes posted a 15 percent rise in net profit last year to $1.6 billion.
If a string of weak sentiment numbers and data continues, Bryn Mawr Trust Chief Investment Officer Ernie Cecilia told CNBC companies could trim spending and scale back hiring.
"It certainly is an issue. I think in many ways the first quarter is a possible air pocket or a slowdown," Cecilia said. "If it's deeper and more pervasive, then it would be a concern for employment, it would be a concern for wages, it would be a concern for earnings and it would be a concern for the market."
— CNBC'S Fred Imbert contributed reporting.