The numbers come first. As of Monday, the blended earnings growth rate for the S&P 500 in Q2 2026 stands at 51%, according to an analysis by John Butters, VP and senior earnings analyst at FactSet. If that figure holds, it would mark the index's highest earnings growth rate since Q2 2021, when it reached 91.6%.
Two companies are doing heavy lifting — but not all of it.
Alphabet and Amazon are responsible for most of the jump in that growth rate since June 30. Both companies reported actual GAAP earnings per share that blew past analyst estimates, with both receiving a significant lift from unrealized gains on investments recognized as other income. Alphabet posted EPS of $9.11 against an estimate of $2.88. Amazon reported $5.75 versus an estimate of $1.82.
Strip out those two companies, and the blended earnings growth rate for the S&P 500 falls to 32.6% from 51%, per Butters's analysis. That is still the index's highest earnings growth rate since Q3 2021, when it hit 40.6% — and it would still represent the seventh consecutive quarter of double-digit earnings growth, a streak that predates the AI infrastructure buildout dominating headlines this year.
Breadth matters as much as the headline number.
The strength is not confined to a pair of tech giants. Overall, 10 of 11 sectors are reporting year-over-year earnings growth, with nine of those 10 sectors posting double-digit gains. Energy is surging 146.3% year-over-year, supported by firm fuel prices. Communication Services earnings are up 116.9% year-over-year, amplified by mark-to-market gains from AI infrastructure investments. Health care is the lone detractor, reporting a year-over-year profit decline of approximately 6.5%.
What executives are actually talking about.
The language on Q2 earnings calls tells its own story. The term 'AI' has been cited on 305 calls among S&P 500 companies so far this quarter. 'Inflation' has appeared on 193 calls. 'Tariff' has been cited on 162 calls. By contrast, 'tariff refund' — a phrase that would signal direct policy relief flowing to corporate bottom lines — has appeared on only 35 calls to date.
The CEO Times read.
Seven consecutive quarters of double-digit earnings growth is not a fluke, and it is not solely the product of two companies gaming accounting rules on investment gains. Broad sector participation — ten of eleven sectors growing, nine in double digits — reflects an economy where free enterprise, when given room to operate, compounds. The AI buildout is real, the energy rebound is real, and capital is rewarding both.
The health care drag is worth watching: it is the one sector where regulatory and pricing pressure continues to suppress returns. The market has already voted on where productive capital wants to go. Washington should take note.
