There were 55 profit warnings issued by UK-listed companies in the first quarter of the year, with almost half ( 49%) citing policy change and geopolitical uncertainty as a leading factor – compared with 34% during the same period last year.

The report, published on a quarterly basis, identified rising costs as the other main driver behind profit warnings – referenced in more than a fifth ( 22%) of Q1 warnings, followed by contract and order cancellations or delays ( 16%).

Of the 24 warnings issued by listed firms since the US launched airstrikes on Iran on 28^th February, 42% cited the conflict in the Middle East as a factor.

EY-Parthenon tracks the statements from publicly listed companies to the stock exchange outlining that they will report full-year profits materially below management or market expectations.

Jo Robinson, EY-Parthenon partner and UK&I financial restructuring leader, said: “The slower pace of profit warnings at the end of last year may have continued into early 2026, but UK-listed companies now face a prolonged period of uncertainty following the conflict in the Middle East. Higher costs and supply chain disruption will take time to filter through to earnings and order books, as customers delay, pause, renegotiate or reduce spending, but will overlap with existing business challenges and amplify the strain on earnings for some.

The FTSE sectors with the highest number of profit warnings during the first quarter were software and computer services (seven warnings), industrial support services – which encompasses business service providers, industrial suppliers and recruitment companies – and travel and leisure (both five).  

“Sustained uncertainty is likely to embed a risk premium in exposed markets, with pressure concentrating in cash‑constrained, highly leveraged and operationally stretched businesses. As challenges mount, companies need to be constantly redefining what resilience means in this lower‑growth, higher‑cost and unpredictable business environment.”

EY-Parthenon’s research has found that almost a fifth ( 19%) of all UK-listed businesses have issued at least one profit warning in the last 12 months.