Over one-quarter of the way through the Q2 earnings season, the S&P 500 is reporting impressive results, even if one excludes the unusually large EPS surprise reported by Alphabet. Overall, both the percentage of S&P 500 companies reporting positive earnings surprises and the magnitude of earnings surprises are above recent 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. In addition, the index is also reporting its highest (year-over-year) earnings growth rate since Q3 2021.
Overall, 27% of the companies in the S&P 500 have reported actual results for Q2 2026 to date. Of these companies, 86% have reported actual EPS above estimates, which is above the 5-year average of 78% and above the 10-year average of 76%. In aggregate, companies are reporting earnings that are 39.3% above estimates, which is above the 5-year average of 7.0% and above the 10-year average of 7.4%. 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.
The unusually high earnings surprise percentage for the index is mainly due to the unusually large positive EPS surprise reported by Alphabet ($9.11 vs. $2.88) for Q2. The (GAAP) EPS actual for Alphabet for Q2 2026 included a gain of $98 billion. Excluding Alphabet, the surprise percentage for the S&P 500 for Q2 2026 would fall to 12.6% from 39.3%.
During the past week, the positive EPS surprise reported by Alphabet was the largest contributor to the increase in the overall earnings growth rate for the index over this period. Since June 30, the positive EPS surprise reported by Alphabet has also been the largest contributor to the increase in the overall earnings growth rate for the index over this period. The (GAAP) EPS actual for Alphabet for Q2 2026 included a gain of $98 billion.
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 37.9% today, compared to an earnings growth rate of 24.8% last week and an earnings growth rate of 23.2% at the end of the second quarter (June 30).
If 37.9% is the actual growth rate for the quarter, it will mark the highest earnings growth rate reported by the index since Q3 2021 (40.3%). It will also mark the second consecutive quarter of earnings growth above 20% and the seventh consecutive quarter of double-digit earnings growth for the index.
Excluding Alphabet, the blended earnings growth rate for the S&P 500 for Q2 2026 would fall to 25.9% from 37.9%.
Ten of the eleven sectors are reporting year-over-year growth. Seven of these ten sectors are reporting double-digit growth, led by the Energy, Communication Services, Information Technology, and Materials sectors. On the other hand, the Health Care sector is the only sector reporting a year-over-year decline in earnings.
In terms of revenues, 80% 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 68%. In aggregate, companies are reporting revenues that are 2.8% above the estimates, which is above the 5-year average of 1.9% and above the 10-year average of 1.6%. 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.
As a result, the blended revenue growth rate for the second quarter is 13.2% today, compared to a revenue growth rate of 12.8% last week and a revenue growth rate of 12.2% at the end of the second quarter (June 30).
During the past week, positive revenue surprises reported by companies in multiple 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 Financials sector have been the largest contributor to the increase in the overall revenue growth rate for the index over this period.
If 13.2% is the actual revenue growth rate for the quarter, it will mark the highest revenue growth rate reported by the index since Q2 2022 (13.9%). It will also mark the second consecutive quarter of double-digit revenue growth for the index.
All eleven sectors are reporting year-over-year growth in revenues, led by the Information Technology, Energy, Communication Services, and Financials sectors.
For Q3 2026 and Q4 2026, analysts are calling for earnings growth rates of 27.3% and 24.9%. For CY 2026, analysts are predicting (year-over-year) earnings growth of 27.3%.
The forward 12-month P/E ratio is 20.1 (based on Wednesday’s closing price and EPS), which is above the 5-year average (19.9) and above the 10-year average (19.0). This P/E ratio is also below the forward P/E ratio of 20.4 recorded at the end of the second quarter (June 30).
During the upcoming week, 177 S&P 500 companies (including 9 Dow 30 components) are scheduled to report results for the second quarter.
Q2 2026: Scorecard
Q2 2026: Growth
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