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Almost half (49%) of the 55 profit warnings issued by UK-listed companies in the first quarter of 2026 cited policy change and geopolitical uncertainty, according to the latest EY-Parthenon report.
The findings spell a significant increase from 34% of profit warnings during the same period last year.
The conflict in the Middle East has impacted 42% of the 24 warnings issued since it began on 28 February, while rising costs affected 22% of firms.
Nearly a fifth of all UK-listed businesses have issued at least one profit warning in the last 12 months, with contract delays affecting 16% of companies.
The software and computer services sector recorded seven warnings. Industrial support services and the travel and leisure sector both recorded five warnings during the quarter.
Meanwhile, travel sector warnings reached their joint-highest quarterly total since the third quarter of 2022. Operating costs continue to put pressure on margins for airlines.
Jo Robinson, financial restructuring leader at EY, 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.”
Meg Wilson, financial restructuring partner at EY, added: “Historically, aviation has been among the earliest sectors to feel the impact of oil price and geopolitical disruption.
“Disruption to jet fuel pricing and supply, route adjustments and network reconfigurations will affect airlines differently, and will continue to present challenges that will require careful management.”
