Given concerns in the market about tariffs and higher costs, what is the S&P 500 reporting for a net profit margin for Q4?
The blended net profit margin for the S&P 500 for Q4 2025 is 13.2%. If 13.2% is the actual net profit margin for the quarter, it will mark the highest net profit margin reported by the index since FactSet began tracking this metric in 2009. The current record (going back to 2009) is 13.1%, which occurred in the previous quarter.
At the sector level, four sectors are reporting a year-over-year increase in their net profit margins in Q4 2025 compared to Q4 2024, led by the Information Technology (29.0% vs. 26.8%) and Industrials (12.5% vs. 10.7%) sectors. On the other hand, six sectors are reporting a year-over-year decrease in their net profit margins in Q4 2025 compared to Q4 2024, led by the Real Estate (33.5% vs. 35.1%) sector. One sector (Energy) is reporting no change in net profit margin (7.8%) in Q4 2025 compared to Q4 2024.
Five sectors are reporting net profit margins in Q4 2025 that are above their 5-year averages, led by the Information Technology (29.0% vs. 25.0%) and Industrials (12.5% vs. 9.3%) sectors. On the other hand, six sectors are reporting net profit margins in Q4 2025 that are below their 5-year averages, led by the Health Care (6.9% vs. 9.2%) and Real Estate (33.5% vs. 35.8%) sectors.
Three sectors are reporting a quarter-over-quarter increase in their net profit margins in Q4 2025 compared to Q3 2025, led by the Industrials (12.5% vs. 10.5%) sector. On the other hand, eight sectors are reporting a quarter-over-quarter decrease in their net profit margins in Q4 2025 compared to Q3 2025, led by the Utilities (12.9% vs. 17.1%) sector.
It is interesting to note that analysts believe net profit margins for the S&P 500 will be even higher in 2026. As of today, the estimated net profit margins for Q1 2026 through Q4 2026 are 13.2%, 13.8%, 14.2%, and 14.2%, respectively.
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