Issue #1. I quarter 2025
Issue Highlights
The performance of the world's largest companies in 2024 is generally positive, with companies from developing countries outperforming and/or successfully competing with companies from developed world in most sectors of the world economy. In Q1 2025, the main factor determining strategic decisions of companies and regulators’ decisions was the inconsistent and aggressive trade policy of the new US administration. It affected all key sectors of the world economy, putting them in a state of uncertainty. The growth drivers for individual industries and regions are the continued high demand for products and solutions in IT industries amid the AI boom; the launch of support programs for the auto and steel industries in Europe, which are in crisis; and the accelerated development of the IT industry in China. The companies' activities are negatively affected by the continued weak market conditions in the world's largest countries (USA, Europe, China), the unfolding trade war as a result of D. Trump's policy and sanctions pressure on China, Russia, and Iran.
The performance of the world's largest companies in 2024 can be generally recognized as positive. The Global Performance Index 2024 was 69%, showing that more than 2/3 of companies increased their revenues compared to the previous calendar year. The gap between the performance of developed and developing countries’ companies is not significant and provides the latter with only a slight advantage. Сompanies from developing world expanded their activities in the oil and gas, semiconductor, telecommunications and food sectors at a faster pace; despite the limitations, they competed with Western companies in the automotive, steel, platform business; they hold strong positions in the consumer electronics, transport and logistics sectors.
Investors' view of the near-term prospects of global business development is generally positive — the value of shares of the world's largest companies in Q1 2025 grew by an average of 1.5% against Q4 2024. The main drivers of growth were successful results of operations in 2024; expectation of continued high demand for products and solutions in IT industries amid the AI boom; deployment of programs to support crisis industries in Europe; accelerated development of the IT sector in China, primarily the semiconductor industry. During the quarter, stock quotes were negatively affected by high uncertainty caused by the aggressive and inconsistent US trade policy, sanctions pressure on China and Russia, as well as the continuing weak environment in the world's largest economies — the US, Europe, and China.
Steel industry
The global steel industry has become one of the cornerstones of the trade war that has unfolded as a result of the aggressive trade policy of the new US administration. Another important event in the industry was the adoption by the European Commission of the Steel and Metals Action Plan, aimed at overcoming the crisis situation facing the European steel industry at the end of 2024.
Food sector
The food sector acted as one of the tools for the EU, China and Canada to fight protectionism and trade and political threats of D. Trump — the countries raised duties on American agricultural products and food. The industry’s players continue to expand activities through acquisitions, partnerships and international expansion.
Automotive industry
The increase of import duties by the US President as a tool for attracting investment in the American automotive industry was a shocking event for the global automotive industry. The first reaction of a number of manufacturers was to revise their price lists and suspend deliveries of some models to the United States in order to develop a strategy for working under the new conditions. The European Commission's presentation of the Comprehensive Support Plan for the automotive industry in order to bring the industry out of the crisis situation was also a landmark event. The plan is aimed at developing battery production, expanding the network of charging stations and increasing sales of electric vehicles in Europe.
Pharmaceutical industry
The global pharmaceutical industry has not been spared from the trade war. While the US is considering imposing duties on Chinese and Indian pharmaceutical ingredients, major US and European pharmaceutical giants continue to actively cooperate with Chinese partners, while taking measures to mitigate potential risks.
Semiconductor industry
The semiconductor industry continues to be the epicenter of the trade war between the US and China. Just as in the auto industry, D. Trump considers import duties to be the most effective tool for developing national production and achieving U.S. leadership in this industry. The strengthening of export controls is forcing China to strive for technological sovereignty at an even more intense pace. Despite the technological lag, Chinese companies are making some progress in this direction.
Consumer electronics
Higher import duties and increased pressure on China from the United States are forcing consumer electronics companies to change their strategies for organizing global production and supplying products to the U.S. market.
IT equipment
Investigations by US regulators into Chinese manufacturers and the expansion by the United States of its export control list to include about 80 companies suspected of contributing to China's military-industrial complex is a key development in the IT equipment industry, that has triggered a response from China. The AI boom, according to experts, will remain the key driver of the industry in the medium term.
Platform business
Chinese platform companies have also faced increased pressure from the US to limit their competitiveness and expansion in the US market. The development and implementation by platforms of AI solutions into their processes and products has become even more intense.
Software
A sensational event in the software industry was the release of an AI model by Chinese startup DeepSeek, which surpassed the world market-leading American AI model ChatGPT in a number of parameters, including development time and cost. This breakthrough increased investor interest in the shares of Chinese technology companies, the value of which began to grow.
Telecommunications
The development of satellite communications and the integration of artificial intelligence into products and services are key trends in the global telecommunications sector. U.S. regulators have not spared Chinese companies in this industry either — China's largest telecommunications operators operating in the U.S. market are called upon to clarify their ties with the Chinese military and government.
Transport and logistics
The global transport and logistics sector is frozen in anticipation of the consequences of the unfolding trade war initiated by the US and sanctions pressure on China. Uncertainty in the area of tariffs for trans-Pacific container transportation, volumes of cargo transportation by various modes of transport and route directions have become the key factors that will determine the further development of the industry.