The financial situation of firms further improved, albeit at a slower pace than in the previous survey round. From October 2017 to March 2018, the percentage of euro area SMEs reporting a higher turnover decreased (24%, down from 27%). The moderation in turnover was also reflected in profits, as 4% of euro area SMEs reported increases, down from 5%, in a context of growing labour costs (50%, up from 49%) and other production costs (54%, up from 48%).