“Magnificent 7” Companies Reported Lowest Earnings Growth Since Q1 2023

With NVIDIA reporting actual results for Q3 on November 19, all the companies in the “Magnificent 7” have now reported earnings for the third quarter. How did the earnings reported by these seven companies perform relative to analyst expectations and year-ago results?

On September 30, the estimated earnings growth rate for the “Magnificent 7” companies for Q2 was 14.7%. Overall, 71% (5 out of 7) of the “Magnificent 7” companies reported a positive EPS surprise, compared to 83% for all S&P 500 companies. In aggregate, earnings reported by the “Magnificent 7” companies exceeded estimates by 2.6%, compared to 6.6% for all S&P 500 companies.

As a result, the “Magnificent 7” companies reported actual earnings growth of 18.4% for the third quarter. This earnings growth rate is below the average earnings growth rate of 28.8% for these seven companies over the previous four quarters.

In fact, this is the lowest earnings growth rate reported by the “Magnificent 7” companies since Q1 2023 (5.6%).

The weaker performance relative to analyst expectations and the lower earnings growth rate for the “Magnificent 7” companies are mainly due to the negative EPS surprise reported by Meta Platforms ($1.05 vs. $6.72) for Q3. The (GAAP) actual EPS for Meta Platforms of $1.05 for Q3 2025 included a one-time, non-cash income tax charge of $15.93 billion. If Meta Platforms were excluded, the other 6 companies would have reported earnings growth of 30.4%.

On the other hand, the other 493 companies in the S&P 500 reported earnings growth of 11.9% for Q3, which marks just the second time that these 493 companies have reported double-digit earnings growth over the past three years.

Despite the lower growth rate relative to recent quarters, four of the “Magnificent 7” companies (NVIDIA, Alphabet, Amazon.com, and Microsoft) are among the top seven contributors to earnings growth for the S&P 500 for the third quarter. Outside of these four companies, Eli Lilly & Company, Uber Technologies, and Intel are the other top contributors. Both Eli Lilly & Company and Intel benefitted from easy comparisons to weaker earnings reported in the year-ago quarter due to charges and expenses that were included in their year-ago (Q3 2024) EPS. On the other hand, the (GAAP) actual EPS for Uber Technologies for Q3 2025 included a $4.9 billion benefit from a tax valuation release.

Looking ahead, analysts expect higher earnings growth for the “Magnificent 7” companies over next four quarters. For Q4 2025 through Q3 2026, analysts are predicting earnings growth rates of 19.8%, 18.5%, 22.1%, and 24.5%, respectively.

 *Not in order of contribution 

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