More Year-End Earning Statements Out This Week
RENEE MONTAGNE, HOST:
And we're in the midst of year-end earnings announcements. This week, companies including Apple, Lockheed-Martin, Microsoft and Starbucks will announce their final 2012 results. NPR's Yuki Noguchi has a preview of the corporate earnings season.
YUKI NOGUCHI, BYLINE: JP Morgan, Goldman Sachs, Morgan Stanley and General Electric all announced fourth-quarter profits last week that pleased their investors. Citigroup and Bank of America, meanwhile, fell short. Nigel Gault is chief U.S. economist for IHS Global Insight. He says he believes corporate profits will, on the whole, meet or exceed expectations, but won't grow at the rate some investors have become accustomed to.
NIGEL GAULT: We've had many years in which margins have been expanding quite rapidly. Corporate profits are at a very high level. So we've got to a point where it's actually quite difficult from now on to generate rapid profit growth, unless you see the economy really accelerating.
NOGUCHI: And that is not what the economy is doing. Gault says he expects economic growth during the fourth quarter of last year to come in around three-tenths of a percent - in other words, almost no growth at all. He says if the government resolves lingering fiscal uncertainty by cutting spending and raising the debt ceiling, the economy could pick up.
GAULT: I think the underlying fundamentals of the economy are getting better, particularly on the housing market, which we're seeing in a series of recent reports. So the economy should be able to accelerate, and we should see stronger profits growth at the same time.
NOGUCHI: Google, Delta Airlines, Johnson and Johnson and Verizon announce their results tomorrow. Yuki Noguchi, NPR News, Washington. Transcript provided by NPR, Copyright NPR.