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Reproduced from PwC CFO Pulse Survey; Chart: Axios Visuals

Having initially predicted they could get through the coronavirus pandemic with their businesses largely unscathed and workforces intact, U.S. corporate leaders are now starting to change their tune.

What it means: Top financial officers have consistently written down their expectations for the economy, their company's financial situation, and how many of their employees they will be able to keep on staff in recent weeks.

  • And the trend of worsening expectations is likely to continue.

Driving the news: The third release of PwC’s survey of American CFOs shows 26% anticipate layoffs at their companies, a marked increase from two weeks ago when the survey found only 16% expected layoffs.

  • More CFOs also expect that even if the virus were contained today, it would take longer for their businesses to recover.

By the numbers: A vast majority (81%) of those surveyed expect COVID-19 to decrease their company’s revenue and/or profits this year, up from 58% in PwC's first survey on March 11.

  • PwC also found 82% of CFOs are now focused on reducing costs, compared to 62% on March 11 (most company's No. 1 cost is employees).
  • Two-thirds (67%) of survey respondents now say they are considering deferring or canceling planned investments — more than double the 32% who said so in the first survey.
  • On March 11, 14% of respondents said they were "not considering any financial actions as a result of COVID-19," but that number dropped to 4% in the latest survey.

What they're saying: Having talked to corporate leaders during three separate periods over the past month, Tim Ryan, U.S. chairman and senior partner at PwC, says, "It is becoming clearer and clearer ... that it’s reasonable to assume that trend will continue."

  • "There's a growing realization that most have, whether it be at the policy-making or business level, which is that controlling the virus is simply going to take longer than we thought," Ryan tells Axios during a media call Monday.
  • "The ripple effect on the supply chain is becoming better understood and it’s causing companies to realize it’ll take a lot longer to bounce back than they had otherwise anticipated."

The big picture: That's bad news for employees, many of whom have been told by corporate leadership that their jobs were secure during the crisis.

  • "The survey is one indicator that the unemployment situation could become more challenging," Ryan says. "Not just in the retail sector, but more broadly."

A separate survey from CFO Magazine conducted March 26–April 2 among 333 CFOs found that more than one-third (35%) are laying off or furloughing employees, even though a majority said they expect a V-shaped recovery. Most said they didn’t know how many employees would be affected.

  • Nearly half (49%) of the executives surveyed indicated that their organization was "scaling back" or delaying investments.

What's next: A clear division of companies is beginning to take shape, separating winners and losers. Many companies that loaded up on cash during 2019 anticipating a recession are in a better position to weather the storm.

  • However, the surveys show companies that are not large, did not have a mountain of cash coming into the year, and are not providing essential services, are already scrambling to stay afloat.

Go deeper: America's small business bailout is off to a bad start

Go deeper

Rep. Lamborn may have misused official resources, ethics panel alleges

Rep. Doug Lamborn departs from a news conference held by the House Republican Israel Caucus on May 19, 2021 in Washington, D.C. Photo: Caroline Brehman/CQ-Roll Call, Inc via Getty Images

Congressional ethics investigators said Monday there is "substantial reason" to believe that Rep. Doug Lamborn (R-Colo.) misused official resources and solicited or accepted improper gifts from subordinates.

Driving the news: Lamborn's aides told investigators they were often asked to run personal errands for his wife, Jeanie Lamborn, and were at one point tasked with helping his son apply for a federal position, according to the Office of Congressional Ethics (OCE). Lamborn strongly denies the allegations.

Biden calls Fox News reporter a "stupid son of a b---h" on hot mic

President Biden blasted Fox News' Peter Doocy on Monday after the reporter asked if the nation's soaring inflation is a political liability, saying, "what a stupid son of a b----h."

Driving the news: The Biden administration has faced rising inflation rates over recent months, which it has labeled as "transitory."

Hope King, author of Closer
2 hours ago - Economy & Business

Investors reset their compass

Data: FactSet; Chart: Axios Visuals

The endpoints of a stimulus-fueled market are being defined.

Why it matters: Conditions that drove excess pricing in riskier assets are steadily being removed, and big swings in the market like those seen today are inevitable as investors try to adjust to the new landscape.