March 12 (Reuters) - Estimates for European blue-chip

companies' fourth-quarter earnings have slightly deteriorated,

the latest LSEG I/B/E/S data showed on Thursday, leaving them on

track for their worst earnings season in the past two years.

Year-on-year earnings of major European companies are now

expected to have shrunk 0.5% in the final quarter of 2025, based

on results from 249 STOXX 600 companies and market

estimates for those that are yet to report, the data showed.

Still, European blue-chips have bucked even more dismal

expectations in recent weeks, as forecasts at the end of January

anticipated 4% year-on-year declines.

* This week's blended earnings growth is slightly worse than

the 0.4% fall estimated last week

* Revenues, on the other hand, have improved and are now

expected to fall 3.6% year-on-year, compared to last week's 4.2%

decrease

* Estimates for European corporate results acutely worsened

throughout 2025, as months of trade upheaval caused by erratic

U.S. policy forced companies to reassess strategies and supply

chains

* Q4 earnings of European blue-chips were forecast to grow

as much as 11.1% in February 2025, before Trump announced plans

for global tariffs

* Earnings of STOXX 600 companies are in stark contrast with

those of U.S. listed ones, a separate LSEG report showed on

Friday

* Blended earnings growth of S&P 500 firms is

estimated at 14.1%, based on results from 492 of the companies

and estimates for the rest, the report showed

* Despite that, last week German asset manager DWS

said concerns remained about U.S. stocks' exposure to AI, after

fears over AI returns sparked a selloff of tech companies in

February

* "Because of the uncertainty that is attached to AI, we

are favouring the less technology-heavy European and Japanese

equity markets over the U.S. market," it said in a note