At this early stage, the third quarter earnings season for the S&P 500 has seen a mixed start relative to expectations. While the percentage of S&P 500 companies reporting positive earnings surprises is above recent averages, the magnitude of earnings surprises is below recent averages. As a result of this mixed performance and downward revisions to EPS estimates for companies in the Health Care sector, the index is reporting lower earnings for the third quarter today relative to the end of last week and relative to the end of the quarter. Despite the decrease in earnings, the index is still reporting (year-over-year) earnings growth above 25% for the 3rd straight quarter.
Overall, 9% of the companies in the S&P 500 have reported actual results for Q3 2026 to date. Of these companies, 84% have reported actual EPS above estimates, which is above the 5-year average of 78% and above the 10-year average of 77%. In aggregate, companies are reporting earnings that are 2.6% above estimates, which is below the 5-year average of 7.5% and below the 10-year average of 8.0%. 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, downward revisions to EPS estimates for companies in the Health Care sector, partially offset by upward revisions to EPS estimates for companies in the Energy sector, were the largest contributors to the decrease in the overall earnings growth rate for the index over this period. In the Financials sector, positive and negative EPS surprises reported by companies in this sector offset each other, resulting in no change in the earnings growth rate for this sector during the past week (to 3.0% from 3.0%). Since September 30, downward revisions to EPS estimates for companies in the Health Care sector, partially offset by upward revisions to EPS estimates for companies in the Energy sector and positive EPS surprises reported by companies in the Information Technology sector, have been the largest contributors to the decrease in the overall earnings growth rate for the index over this period.
As a result, the index is reporting lower earnings for the third 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 third quarter is 29.0% today, compared to an earnings growth rate of 29.4% last week and an earnings growth rate of 29.2% at the end of the third quarter (September 30).
If 29.0% is the actual growth rate for the quarter, it will mark the third consecutive quarter of earnings growth above 25% and the eighth consecutive quarter of double-digit earnings growth for the index.
Ten of eleven sectors are reporting (or are projected to report) year-over-year earnings growth. Five of these sectors are reporting (or are projected to report) double-digit growth, led by the Energy, Information Technology, Communication Services, 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, 67% of S&P 500 companies have reported actual revenues above estimates, which is below the 5-year average of 70% and below the 10-year average of 68%. In aggregate, companies are reporting revenues that are 1.1% above the estimates, which is below the 5-year average of 1.8% and below 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.
During the past week, upward revisions to revenue estimates for companies in the Energy sector and positive revenue surprises reported by companies in the Health Care sector were the largest contributors to the increase in the overall revenue growth rate for the index over this period. Since September 30, upward revisions to revenue estimates for companies in the Energy sector and positive revenue surprises reported by companies in the Information Technology 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 third quarter is 12.6% today, compared to a revenue growth rate of 12.4% last week and a revenue growth rate of 12.2% at the end of the third quarter (September 30).
If 12.6% is the actual revenue growth rate for the quarter, it will mark the third consecutive quarter of double-digit revenue growth for the index.
All eleven sectors are reporting (or are projected to report) year-over-year growth in revenues, led by the Information Technology, Energy, and Communication Services sectors.
For Q4 2026, analysts are calling for earnings growth of 28.6%. For CY 2026, analysts are predicting (year-over-year) earnings growth of 32.8%.
The forward 12-month P/E ratio is 19.0, which is below the 5-year average (19.8) and below the 10-year average (19.1). However, this P/E ratio is equal to the forward P/E ratio of 19.0 recorded at the end of the third quarter (September 30).
During the upcoming week, 79 S&P 500 companies (including 5 Dow 30 components) are scheduled to report results for the third quarter.
Q3 2026: Scorecard
Q3 2026: Growth
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