Summary of Earnings Brief - August 18, 2025 Industry Overview - The report focuses on the S&P 500 index, with 84.9% of its market capitalization having reported earnings for the second quarter of 2025 (2Q25) [1] - Overall expectations for 2Q25 are for revenue growth of 6.1% and earnings per share (EPS) growth of 11.1% [1] Key Insights - **Earnings Performance**: Earnings are beating estimates by an aggregate of 8.3%, with 74% of companies exceeding projections [3] - **EPS Growth Variability**: Projected EPS growth varies significantly across sectors, with the six largest TECH+ companies expected to grow at 27.5% compared to 6.9% for the rest of the market [1][4] - **Upcoming Reports**: Over the next five trading days, 16 companies representing 3.6% of the S&P 500's market cap will report results, including major players like Home Depot, Medtronic, Target, Walmart, and Intuit [3] Sector Performance - **TECH+ Sector**: - Expected EPS growth of 26.2% [18] - The Big 6 TECH+ companies (GOOGL, META, MSFT, AAPL, AMZN, NVDA) show strong individual growth rates, with META at 38.4% actual growth against an expected 15.0% [4] - **Financials**: Expected EPS growth of 20.4% [18] - **Cyclicals**: Expected EPS growth of only 0.2%, with energy sector showing a significant decline of -18.5% [18] - **Non-Cyclicals**: Modest growth of 1.7% expected [18] Earnings Dashboard - **S&P 500 Earnings Metrics**: - Revenue growth: 6.1% - Earnings growth: 10.4% - EPS growth: 11.1% [10] - **TECH+ Metrics**: - Revenue growth: 14.5% - Earnings growth: 26.7% - EPS growth: 26.2% [10] Earnings Surprises - The S&P 500 has reported a surprise of 8.3% in earnings, with TECH+ companies showing a higher surprise of 11.2% [11] - The overall revenue surprise for the S&P 500 stands at 2.7% [11] EPS Growth Expectations - The median company is expected to outgrow the cap-weighted index in 7 out of 11 groups, with TECH+ and Financials anticipated to see the strongest growth [19] - The S&P 500 is projected to grow at 9.1% based on consensus estimates for 2025 [24] Revisions and Trends - EPS revisions for 2025 have been more negative than typical, influenced by tariff announcements in April [40] - Historical trends show that earnings estimates typically decline going into reporting season but improve as results come in [34] Conclusion - The earnings report indicates a strong performance from the TECH+ sector, significantly impacting overall S&P 500 growth. The financial sector also shows robust growth, while cyclicals, particularly energy, are underperforming. The upcoming earnings reports from major companies will be critical in shaping market expectations moving forward.