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The Q2 earnings season is displaying exceptional momentum, characterized by widespread beat rates and an accelerating growth pace. Both earnings and revenue growth—alongside the percentage of positive surprises—are tracking well above recent quarterly averages. While it is still relatively early in the reporting cycle, with results from only 16% of S&P 500 members out, these early results strongly validate the underlying health and resilience of the corporate earnings picture.
For the 81 S&P 500 companies that have reported Q2 results already, total earnings are up +40.6% from the same period last year on +13.3% higher revenues, with 91.4% beating EPS estimates and 81.5% beating revenue estimates.
This is a notably better showing from these 81 index members relative to other recent periods, both in terms of the earnings and revenue growth rates as well as in terms of the beat percentages. The EPS and revenue beat percentages for these 81 index members are matching the 5-year high from 2021 Q3.
The Q2 earnings and revenue growth rates have been boosted by Micron (MU)’s (MU) very strong quarterly results, but the earnings and revenue growth rates would still compare favorably with other recent periods when we exclude Micron from these results. Excluding Micron, Q2 earnings for the remaining 80 index members that have reported Q2 results would be up +20.5% (vs. +40.6% otherwise) on +9.9% higher revenues (vs. +13.3% otherwise).
High Beat Rates Against Rising Estimates
While the big banks and brokerages provided a powerful launchpad for the Q2 earnings season, reporting momentum has rapidly expanded well beyond the Finance sector. The central theme emerging across the broader market remains one of consistent, widespread strength.
Companies across a diverse spectrum of industries—ranging from General Motors (GM - Free Report) and AT&T (T - Free Report) to Wabtec (WAB - Free Report) and CME Group (CME - Free Report) — are comfortably topping consensus estimates. More importantly, management commentary across these varied sectors continues to offer reassuring signals regarding underlying demand and operational resilience in their respective markets.
As shown below, the proportion of companies beating both Q2 EPS and revenue estimates is tracking at a 20-quarter high.
Image Source: Zacks Investment Research
What makes this achievement particularly impressive is the backdrop: analysts actually revised Q2 estimates upward heading into reporting season. This stands in stark contrast to historical trends, where earnings expectations are typically lowered ahead of time to create an easy bar for companies to clear. Beating these elevated expectations underscores the genuine underlying strength of corporate earnings.
The Earnings Big Picture
The chart below shows S&P 500 expectations for 2026 Q2 in terms of what was achieved in the preceding four periods and what is currently expected for the following three quarters.
Image Source: Zacks Investment Research
The chart below shows the overall earnings picture for the S&P 500 index on an annual basis.
Image Source: Zacks Investment Research
As with estimates for Q2, estimates for full-year 2026 have also been steadily going up, particularly since the start of March. The chart below shows the evolution of aggregate S&P 500 earnings estimates since last July.
Image Source: Zacks Investment Research
Full-year 2026 earnings estimates have increased for 11 of the 16 Zacks sectors since the start of March, with the most pronounced gains at the Energy, Basic Materials, Tech, Industrials, Utilities, and Business Services sectors. On the negative side, estimates have been under pressure for the Transportation, Autos, Medical, and Consumer Discretionary sectors since the start of March. History suggests that these favorable revisions will get a boost from the Q2 earnings season and updated management guidance.
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