Earnings may be up as U.S. public companies report their quarterly results. Revenues, however, are not. This may be a sign of trouble ahead, perhaps driven largely by a slowing in exports to Europe.

The USA Today reports on U.S. corporate revenues:

Investors were hoping by this point in the economic cycle, companies would be able to find growth selling new products and services or tapping new customers. But in the first quarter, revenue is coming in 0.6% lower than in the year-ago period, down from the 0.9% growth expected at the beginning of the year, Butters says. Just 44% of companies have beaten revenue estimates, while 56% have missed, making it the third quarter in the past four with more cases of revenue falling short than coming in better than expected.

Much of the revenue weakness is hitting companies that rely most on Europe, says Sam Turner of RiverFront Investment Group. The biggest sources of upside revenue surprises have been sectors such as utilities and telecom, which don’t rely on Europe, while large technology and industrials have been hurt most, Turner says. Of the 23 Dow Jones industrial average components to report so far, 15 have missed expectations, including International Business Machines, Caterpillar and United Technologies, Butters says.

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