Insight to All Things Currency and Treasury Management

A benchmarking tool for corporations, FiREapps Q3 2017 Currency Impact Report™ concluded that North American and European multinationals reported a total of $5.27 billion in negative impact due to FX in Q3 2017.

European companies sustained the largest FX impact since 2015, with 26 companies reporting a collective $4.27 billion in losses, as compared $730 million in the previous quarter.

While European impact increased, FX impact to North American companies decreased, as did the number of North American companies reporting impacts due to currency during earnings calls. Of the 26 companies quantifying, North American corporations sustained $1.01 billion in negative currency impacts and 26 European corporations reported $4.27 billion in losses.

Additionally, the average earnings per share (EPS) impact reported by North American companies was 3 cents – three times the industry standard of managing EPS at risk to less than 1 cent. It has continued to hover around 3 cents to 4 cents over the past five quarters.

The steep increase in negative FX impacts to European companies this quarter solidifies the continued importance for multinationals to manage their FX risk – better exposure management leads to less negative financial impact from currency fluctuations.

To learn more about how North American and European multinationals were impacted by FX, download the Q3 2017 Currency Impact Report.