Kyriba’s Currency Impact Report: FX Impacts Rock Multinationals to Record-breaking $49 Billion
Quarterly Report Reveals North American Corporations Struck By $34 Billion in FX Headwinds, Up 3,583% in Less Than a Year
SAN DIEGO – October 18, 2022 – Kyriba’s Currency Impact Report (CIR), a comprehensive quarterly report which details the impacts of foreign exchange (FX) exposures among 1,200 multinational companies based in North America and Europe with at least 15 percent of their revenue coming from overseas, sustained $49.09 billion in total impacts to earnings from currency volatility. The combined pool of corporations reported $11.82 billion in tailwinds and $37.27 billion in headwinds in the second quarter of 2022. North American companies reported $34.25 billion in headwinds in Q2 2022, a 134% increase compared to the previous quarter, and 3,583% increase since Q3 2021. European companies reported a 68% percent increase in negative currency impacts, with companies reporting $3.02 billion in FX-related headwinds.
“Multinational corporations with a major FX hit are likely to see bottom line value, or earnings per share, go down,” said Wolfgang Koester, Chief Evangelist of Kyriba. “Companies not monitoring and managing their FX exposures with modern industry best practices will be the ones reporting impacts during earnings calls. With the dollar strength at a 20-year high, CFOs need to eliminate EPS at risk, and CEOs need to understand the vulnerability of their balance sheets and income statements to supply chain risks, inflationary pressures, and currency volatility.”
Highlights from the October 2022 Kyriba Currency Impact Report include:
- The average earnings per share (EPS) impact from currency volatility reported by North American companies in Q2 2022 increased to $0.10.
- Publicly traded North American companies reported $34.25 billion in headwinds
- Publicly traded North American companies reported $220 thousand in tailwinds.
- North American companies indicated the Russian ruble (RUB) as the most impactful currency, with 33% of companies referencing it as impacting revenues; the Canadian dollar (CAD) was second at 26.7%, and the euro (EUR) was third with 20% of North American companies identifying it as impactful.
- The euro was the currency most mentioned as impactful by European companies on earnings calls, followed by the dollar and ruble.
- The top five industries that experienced the greatest impact from currencies in North America were (in ranked order): machinery, trading & distribution, professional services, health equipment & supplies, biotech & pharmaceuticals, and chemicals.
“FX impacts dramatically increased over the past quarter, with $.10 average impact to EPS for North American companies, as global market volatility created a $49 billion hit to earnings due to currency exposures. What is more critical today against this backdrop of volatility and uncertainty is the ability for CFOs and risk managers to leverage best practices in enterprise liquidity management, gaining more sophisticated analytics to make FX programs more effective at combating the effects of currency headwinds,” Koester said.
To learn more about FX impacts to specific industries and which currencies were most impactful to multinationals, download the October 2022 Kyriba Currency Impact Report here.
About Kyriba Corp.:
Kyriba empowers CFOs, Treasurers, and their IT counterparts to transform treasury, payments, working capital, and connectivity solutions to activate liquidity as a dynamic, real-time vehicle for growth and value creation. Kyriba is a secure, scalable SaaS platform that leverages artificial intelligence, automates payments workflows, and enables thousands of multinational corporations and banks to maximize growth, protect against loss from fraud and financial risk, and reduce operational costs. With over 2,500 clients worldwide, including 25% of Fortune 500 and Eurostoxx 50 companies, Kyriba manages more than 1.3 billion bank transactions per year, and 250 million payments for a total value of $15 Trillion annually.
Kyriba is headquartered in San Diego, with offices globally. For more information, visit www.kyriba.com.
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