S&P 500 Is Reporting Highest Revenue Growth in (At Least) 13 Years

As of August 6, the blended (combines actual results for companies that have reported and estimated results for companies that have yet to report), year-over-year revenue growth rate for Q2 2021 is 24.7%. How does this growth rate compare to recent quarters? What sectors and companies are reporting the highest growth in revenues?

The Q2 revenue growth rate of 24.7% is well above the five-year average growth rate of 4.5% and the 10-year average growth rate of 3.4%. In fact, if 24.7% is the actual growth rate for the quarter, it will mark the highest year-over-year revenue growth reported by the index since FactSet began tracking this metric in 2008. The current record is 12.7%, which occurred in Q2 2011. The unusually high growth rate is due to a combination of higher revenues in Q2 2021 and an easier comparison to lower revenues in Q2 2020 due to the negative impact of COVID-19 on a number of industries.

At the sector level, all 11 sectors are reporting year-over-year growth in revenues. On a percentage basis, eight of the 11 sectors are reporting double-digit revenue growth, led by the Energy (112.8%), Materials (37.8%), and Consumer Discretionary (34.7%) sectors. On a dollar-level basis, nine of the 11 sectors are reporting a year-over-year increase in revenues of at least $30 billion, led by the Energy (+$130.5 billion), Consumer Discretionary (+$120.2 billion), and Health Care (+$102.8 billion) sectors.

At the company level, Caesars Entertainment (+1,878%), Las Vegas Sands (+1,097%), Wynn Resorts (+1,055%), MGM Resorts (+683%), and Live Nation Entertainment (+677%) have reported the largest year-over-year increases in revenues on a percentage basis, while Exxon Mobil (+$35.1 billion), Amazon.com (+$24.2 billion), Chevron (+$24.1 billion), Alphabet (+$23.6 billion), and Apple (+$21.7 billion) have reported the largest year-over-year increases in revenues on a dollar-level basis.

Analysts expect the S&P 500 to continue to report double-digit revenue growth for the remainder of 2021, but at lower levels compared to Q2 2021. The estimated revenue growth rate for Q3 2021 is 14.4%, while the estimated revenue growth for Q4 2021 is 11.0%.

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