Weak consumer confidence has emerged as a growing threat to corporate performance, with a rising number of listed UK companies issuing profit warnings ahead of next month’s autumn Budget.
According to a new report from EY, 64 UK-listed firms issued profit warnings in the third quarter of 2025 — and one in five cited deteriorating consumer sentiment as a key factor. This marks the highest proportion of warnings linked to consumer confidence since late 2022, when soaring energy prices and the cost-of-living crisis drove sharp reductions in household spending.
EY’s data shows that macroeconomic and geopolitical instability also continues to bite. A record 47% of warnings referenced policy shifts or international tensions as drag factors, reflecting ongoing uncertainty over fiscal policy, regulatory changes and global conflicts.
Businesses in the software and computer services sector issued the most profit warnings, followed by construction and media. Construction has also been the most affected sector in terms of corporate collapse, recording 3,934 insolvencies in the 12 months to August, according to the Insolvency Service. Wholesale and retail firms — including those involved in vehicle repair — were the second most impacted, with 3,710 insolvencies over the same period.
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