Turkish Stock Market Faces Profit Decline and Investor Exodus
the Turkish stock market (Borsa Istanbul) experienced a mixed performance in the second quarter, wiht large companies showing resilience while smaller and medium-sized businesses struggled amidst deepening economic pressures. Overall net profit for companies within the BIST TUM index decreased by 11.2% year-over-year, totaling 259 billion Turkish Lira.
A important number of companies reported financial difficulties. 269 companies announced losses, coinciding with a rise in debt levels. Specifically, debt increased for 453 companies in the BIST TUM index on an annual basis, and for 411 companies on a quarterly basis.
Despite overall declines, 132 companies within the index saw profits increase by as much as 99% year-over-year.However, of the 105 companies reporting profits in the second quarter of 2024, a significant number experienced losses in the same period. 45 companies transitioned from loss to profit,while 62 companies reported annual losses in the second quarter of 2025. Sales also decreased for 286 companies, with some experiencing declines exceeding 99%.
Fund manager Kadirhan Ozturk expressed concern about the sustainability of corporate tax collection, stating that companies may be unable to pay taxes for the next 2-3 years given the current economic climate.
The deteriorating financial landscape has led to a significant decrease in investor confidence. Over 1.2 million investors have left the market, with the number of domestic investors falling from 5.7 million in June 2024 to 4.5 million a year later – a decrease of 1,253,000. Foreign investor numbers also declined, dropping from 19,666 to 17,322.The banking sector proved more stable, maintaining over 1 million investors despite a loss of 76,000.
