S&P 500 Reporting Highest Revenue Growth in 3 Years

At this late stage of the earnings season, the (blended) revenue growth rate for the S&P 500 for Q3 is 8.4%. If 8.4% is the actual growth rate for the quarter, it will mark the highest revenue growth rate reported by the index since Q3 2022 (11.0%). At the sector level, all eleven sectors are reporting (or have reported) year-over-year revenue growth. Three sectors are reporting (or have reported) double-digit revenue growth for the quarter: Information Technology, Health Care, and Communication Services.

However, the Q3 revenue growth rate for the S&P 500 has been increasing over a longer timeframe. On June 30, the estimated revenue growth rate for Q3 was 4.8%. On September 30, the estimated revenue growth rate for Q3 was 6.3%. Today, the (blended) revenue growth rate is 8.4%. Which sectors and companies have been the largest contributors to the increase in the Q3 revenue growth rate for the S&P 500 since September 30?

At the sector level, the Health Care, Financials, and Consumer Discretionary sectors have been the largest contributors to the increase in the revenue growth rate for the S&P 500 since September 30.

The Health Care sector has been the largest contributor to the increase in the revenue growth rate for the S&P 500 since September 30, accounting for about 20% of the total increase. Within this sector, the positive revenue surprises reported by Cardinal Health ($64.01 billion vs. $59.24 billion), CVS Health ($102.87 billion vs. $98.81 billion), Centene Corporation ($49.69 billion vs. $47.72 billion), Cigna Group ($69.57 billion vs. $67.58 billion), and Eli Lilly & Company ($17.60 billion vs. $16.05 billion) have been significant contributors to the increase in the revenue growth rate since the end of the quarter. As a result, the blended revenue growth rate for the Health Care sector has increased to 10.4% from 8.0% over this period.

The Financials sector has been the second-largest contributor to the increase in the revenue growth rate for the S&P 500 since September 30, also accounting for about 20% of the total increase. Within this sector, the positive revenue surprises reported by Apollo Global Management ($9.82 billion vs. $4.92 billion), Prudential ($16.24 billion vs. $14.14 billion), Morgan Stanley ($18.22 billion vs. $16.69 billion), JPMorgan Chase ($46.43 billion vs. $45.47 billion), Goldman Sachs ($15.18 billion vs. $14.12 billion), and Citigroup ($22.09 billion vs. $21.09 billion) have been substantial contributors to the increase in the revenue growth rate since the end of the quarter. As a result, the blended revenue growth rate for the Financials sector has increased to 9.4% from 6.8% over this period.

The Consumer Discretionary sector has been the third-largest contributor to the increase in the revenue growth rate for the S&P 500 since September 30, accounting for about 18% of the total increase. Within this sector, the positive revenue surprises reported by Ford Motor ($50.53 billion vs. $47.05 billion), General Motors ($48.59 billion vs. $45.04 billion), Tesla ($28.10 billion vs. $27.23 billion), and Amazon.com ($180.17 billion vs. $177.91 billion) have been substantial contributors to the increase in the revenue growth rate since the end of the quarter. As a result, the blended revenue growth rate for the Consumer Discretionary sector has increased to 7.3% from 4.1% over this period.

Outside of these three sectors, the positive revenue surprises reported by Bunge Global ($22.16 billion vs. $14.73 billion), Alphabet ($102.35 billion vs. $99.94 billion), NVIDIA ($57.01 billion vs. $54.96 billion), Microsoft ($77.67 billion vs. $75.49 billion), and Walmart ($179.50 billion vs. $177.44 billion) have also been significant contributors to the increase in the revenue growth rate for the S&P 500 for Q3 since September 30.

It is interesting to note that analysts believe the S&P 500 will report lower revenue growth over the next five quarters. For Q4 2025 through Q4 2026, the estimated (year-over-year) revenue growth rates for the S&P 500 are 7.3%, 7.9%, 7.0%, 6.2%, and 7.2%, respectively.

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