Second-quarter earnings for companies in the S&P 500 are on track to grow 47.5 per cent year on year, according to FactSet estimates, close to three times the five-year average of 16.4 per cent.
If the figure holds, it will mark a second consecutive quarter of growth above 20 per cent and a seventh straight quarter of double-digit growth for the index.
What is driving the numbers?
Individual results have been large enough to move the aggregate. Eli Lilly reported revenue up 47.7 per cent and beat earnings estimates by $2.37 a share. Shopify rose 18.3 per cent after reporting revenue growth of 34 per cent and gross merchandise volume up 32 per cent to $115.57bn. Arista Networks gained 12 per cent.
| Measure | Rate |
|---|---|
| Expected Q2 2026 growth | 47.5% |
| Five-year average | 16.4% |
| Ten-year average | 10.3% |
| Consecutive double-digit quarters | 7 |
How strong is the 2026 earnings season?
Analysts expect second-quarter 2026 earnings for S&P 500 companies to grow 47.5 per cent year on year, according to FactSet. That compares with a five-year average growth rate of 16.4 per cent and a ten-year average of 10.3 per cent. Should the estimate hold, it would represent the second consecutive quarter of earnings growth above 20 per cent for the index and the seventh consecutive quarter of double-digit growth. The strength of results has lifted United States equity indices to record closing highs, with the Dow Jones Industrial Average and S&P 500 both setting records during the first week of August 2026. Several companies exceeding estimates nonetheless saw their shares fall, including Advanced Micro Devices and SpaceX, as investors focused on capital spending and cash generation.
Why are some beats being punished?
Exceeding estimates has not guaranteed a positive reaction. Advanced Micro Devices fell 8.8 per cent after hours despite beating on revenue and earnings, and SpaceX dropped more than 10 per cent after doing the same.
In both cases the concern was spending rather than sales. Memory manufacturers SanDisk and Western Digital also fell after reporting, having rallied strongly earlier in the year.
The pattern suggests expectations have moved ahead of published consensus in parts of the technology sector, so that meeting the formal estimate is no longer sufficient.
What comes next?
The rally rests on two supports that are not equally durable. Earnings are reported figures; the Hormuz outcome depends on a diplomatic agreement that has not been concluded.
How reliable is the estimate?
The 47.5 per cent figure is a blended rate combining companies that have already reported with estimates for those still to come. It moves as the season progresses, and historically the final number lands above the forecast because companies tend to beat lowered estimates.
Aggregate index growth can also be distorted by a small number of very large results. A handful of companies with heavy index weightings can lift the total well above what the median company is achieving.
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Sources for this report
The Redline News Desk
The Redline News desk files and edits world reporting. Every story carries the sources it was built from, and corrections are published on the story itself.
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