S&P 500 Earnings Season Update: August 1, 2025

About two-thirds of the way through the second quarter earnings season, the S&P 500 is reporting strong results. Both the percentage of S&P 500 companies reporting positive earnings surprises and the magnitude of earnings surprises are above their 10-year averages. As a result, the index is reporting higher earnings for the second quarter today relative to the end of last week and relative to the end of the quarter. On a year-over-year basis, the S&P 500 is reporting double-digit earnings growth for the third consecutive quarter. In addition, S&P 500 companies are reporting strong numbers for revenues relative to analyst expectations and year-ago results.

Overall, 66% of the companies in the S&P 500 have reported actual results for Q2 2025 to date. Of these companies, 82% have reported actual EPS above estimates, which is above the 5-year average of 78% and above the 10-year average of 75%. If 82% is the final number for the quarter, it will mark the largest percentage of S&P 500 companies reporting a positive EPS surprise for a quarter since Q3 2021 (also 82%). In aggregate, companies are reporting earnings that are 8.0% above estimates, which is below the 5-year average of 9.1% but 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 four of the “Magnificent 7” companies in the Information Technology, Consumer Discretionary, and Communication Services sectors were the largest contributors to the increase in the overall earnings growth rate for the index over this period. Since June 30, positive EPS surprises reported by companies in the Financials sector and by five of the “Magnificent 7” companies in the Communication Services, Information Technology, and Consumer Discretionary 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 second 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 second quarter is 10.3% today, compared to an earnings growth rate of 6.5% last week and an earnings growth rate of 4.9% at the end of the second quarter (June 30).

If 10.3% is the actual growth rate for the quarter, it will mark the third consecutive quarter of double-digit earnings growth for the index.

Eight of the eleven sectors are reporting year-over-year growth, led by the Communication Services, Information Technology, and Financials sectors. On the other hand, three sectors are reporting a year-over-year decline in earnings, led by the Energy sector.

In terms of revenues, 79% of S&P 500 companies have reported actual revenues above estimates, which is above the 5-year average of 70% and above the 10-year average of 64%. If 79% is the final number for the quarter, it will mark the largest percentage of S&P 500 companies reporting a positive revenue surprise for a quarter since Q2 2021 (87%). In aggregate, companies are reporting revenues that are 2.6% above the estimates, which is above the 5-year average of 2.1% and above the 10-year average of 1.4%. If 2.6% is the final number for the quarter, it will mark the largest revenue surprise percentage reported by the index since Q3 2022 (also 2.6%). 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 the Health Care, Consumer Discretionary, and Information Technology sectors were the largest contributors to the increase in the overall revenue growth rate for the index over this period. Since June 30, positive revenue surprises reported by companies in the Health Care, Consumer Discretionary, Information Technology, and Communication Services sectors 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 second quarter is 6.0% today, compared to a revenue growth rate of 5.0% last week and a revenue growth rate of 4.2% at the end of the second quarter (June 30).

If 6.0% is the actual revenue growth rate for the quarter, it will mark the highest revenue growth rate reported by the index since Q3 2022 (11.0%).

Ten sectors are reporting year-over-year growth in revenues, led by the Information Technology, Health Care, and Communication Services sectors. On the other hand, the Energy sector is the only sector reporting a year-over-year decline in revenues.

For Q3 2025 and Q4 2025, analysts are calling for earnings growth rates of 7.6% and 7.0%, respectively. For CY 2025 analysts are predicting (year-over-year) earnings growth of 9.9%.

The forward 12-month P/E ratio is 22.2, which is above the 5-year average (19.9) and above the 10-year average (18.5). This P/E ratio is also slightly above the forward P/E ratio of 22.1 recorded at the end of the second quarter (June 30).

During the upcoming week, 122 S&P 500 companies (including 4 Dow 30 companies) are scheduled to report results for the second quarter. 

Q2 2025: Scorecard

Q2 2025: Growth

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