At this stage of the earnings season, the S&P 500 is reporting solid results for the first quarter. Although the percentage of S&P 500 companies reporting positive earnings surprises is below recent averages, the magnitude of earnings surprises is above recent averages. As a result, the index is reporting higher earnings for the first quarter today relative to the end of last week and relative to the end of the quarter. The index is also reporting double-digit earnings growth for the second consecutive quarter.
Overall, 36% of the companies in the S&P 500 have reported actual results for Q1 2025 to date. Of these companies, 73% have reported actual EPS above estimates, which is below the 5-year average of 77% and below the 10-year average of 75%. In aggregate, companies are reporting earnings that are 10.0% above estimates, which is above the 5-year average of 8.8% and above the 10-year average of 6.9%. Historical averages reflect actual results from all 500 companies, not the actual results from the percentage of companies that have reported through this point in time.
During the past week, positive EPS surprises reported by companies in the Communication Services sector were the largest contributors to the increase in the overall earnings growth rate for the index over this period. Since March 31, positive EPS surprises reported by companies in the Communication Services and Financials sectors have been the largest contributors to the increase in the overall earnings growth rate for the index over this period.
As a result, the index is reporting higher earnings for the first quarter today relative to the end of last week and relative to the end of the quarter. The blended (combines actual results for companies that have reported and estimated results for companies that have yet to report) earnings growth rate for the first quarter is 10.1% today, compared to an earnings growth rate of 7.0% last week and an earnings growth rate of 7.2% at the end of the first quarter (March 31).
If 10.1% is the actual growth rate for the quarter, it will mark the second consecutive quarter of double-digit earnings growth for the index. It will also mark the seventh consecutive quarter of year-over-year earnings growth.
Six of the eleven sectors are reporting year-over-year growth, led by the Health Care, Communications Services, Information Technology, and Utilities sectors. On the other hand, five sectors are reporting a year-over-year decline in earnings, led by the Energy sector.
In terms of revenues, 64% of S&P 500 companies have reported actual revenues above estimates, which is below the 5-year average of 69% and equal to the 10-year average of 64%. In aggregate, companies are reporting revenues that are 1.0% above the estimates, which is below the 5-year average of 2.1% and below the 10-year average of 1.4%. Again, historical averages reflect actual results from all 500 companies, not the actual results from the percentage of companies that have reported through this point in time.
During the past week, positive revenue surprises reported by companies in multiple sectors (led by the Health Care sector) were the largest contributors to the increase in the overall revenue growth rate for the index during this period. Since March 31, positive revenue surprises reported by companies in the Health Care sector, partially offset by negative revenue surprises reported by companies in the Consumer Discretionary sector, have been the largest contributors to the increase in the overall revenue growth rate for the index over this period.
As a result, the blended revenue growth rate for the first quarter is 4.6% today, compared to a revenue growth rate of 4.3% last week and a revenue growth rate of 4.4% at the end of the first quarter (March 31).
If 4.6% is the actual revenue growth rate for the quarter, it will mark the 18th consecutive quarter of revenue growth for the index.
Ten sectors are reporting year-over-year growth in revenues, led by the Information Technology and Health Care sectors. On the other hand, the Industrials sector is the only sector reporting a year-over-year decline in revenues.
For Q2 2025 through Q4 2025, analysts are calling for earnings growth rates of 6.4%, 8.8%, and 8.3%, respectively. For CY 2025, analysts are predicting (year-over-year) earnings growth of 9.7%.
The forward 12-month P/E ratio is 19.8, which is below the 5-year average (19.9) but above the 10-year average (18.3). This P/E ratio is also below the forward P/E ratio of 20.2 recorded at the end of the first quarter (March 31).
During the upcoming week, 180 S&P 500 companies (including 11 Dow 30 components) are scheduled to report results for the first quarter.
Q1 2025: Scorecard
Q1 2025: Growth
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