Wall Street Expects Big Drop in Corporate Earnings and More Layoffs Starting January: Analysts

Traders work on the floor of the New York Stock Exchange during morning trading in New York on Nov. 2, 2022. Michael M. Santiago/Getty Images

U.S. businesses are expected to see corporate earnings drop owing to a slowdown in the economy and rising interest rates, while many prominent tech firms will continue with staff layoffs starting this month, according to analysts.

“Downgrades will be a key driver of the first quarter and especially this earnings season,” Joachim Klement, a market analyst at Liberum Capital in London, told The New York Times. “I expect a lot of downward guidance for 2023 from all kinds of companies as we head towards recession.”