International Business Report Q1 2026

Milan, 27 April 2026 – The Iran war has seen global mid-market business optimism fall sharply: in Q1 2026 just 68% of business leaders had optimistic expectation on the global outlook of their country, a marked six points fall from the previous quarter. This is the main takeaway on Q1 2026 from the Grant Thornton International Business Report (IBR), a quarterly survey on over 4,000 business leaders of mid-market businesses globally.

Business leaders indicate concern about the war's impact on lead times and the cost of shipping or delivery of goods, with those expecting this to increase up five points to 47%. There is also a four point increase in concerns over a shortage of orders due to reduced demand (up to 48%).

The IBR also shows a five point increase in concerns over geopolitical disruption, with 51% of business leaders seeing it as a constraint on their business, feeding through to a four point increase in concerns over economic uncertainty according to 57% of respondents.

While the war will clearly continue to have an impact, especially if the Strait of Hormuz remains closed or restricted for an extended period, the sad reality is the mid-market has plenty of recent experience to call upon as for managing geopolitical events. From Russia’s invasion of Ukraine to the adjustments required during Covid, businesses have become increasingly adept and effective at responding to major market shocks.  This may explain why expectations for profitability remain unchanged, with 64% still expecting to see an increase.

It appears that most business leaders are hoping for a short conflict that they can absorb, with only a two point rise in those expecting to increase selling prices to counter inflationary pressures - up to 51% expecting to do so.

That hope seems to be flowing through to their global ambitions with little to no change for those expecting to increase exports (51%), revenue from non-domestic markets (46%) and the ratio of employees focused on non-domestic markets (37%).

According to the IBR data for Q1 2026, the optimism of Italian mid-market businesses is at 59%, in line with the levels of the previous quarter and with the EU average (57%). Expectations for turnover growth are at 56% and for profitability at 52%, whereas employment increased to 50% (+4 pp compared to the previous quarter), markedly above the EU average (43%).

Among the main constraints to growth mentioned by business leaders are excess regulation and red tape (56%) and energy costs (52%); geopolitical disruption is perceived as a constraint by 53% of Italian respondents, whereas worries about economic uncertainty are down 9 percentage points at 48%.

As for prices, the percentage of those expecting to increase selling prices is up 13 points to 54%. As far as exports are concerned, expected revenues from foreign markets are down 8 percentage point to 38%. 56% of businesses expect to invest in technology, 52% in R&D and 51% in training and development of their personnel.