S&P 500 companies are on track for earnings growth exceeding 20% in 2026, driven by a surge in corporate profits that has already exceeded expectations in early quarters. The full-year earnings growth rate for the index is now expected to reach 24.1% to 24.5%, according to FactSet and Goldman Sachs, marking one of the strongest profit expansion cycles in years.
The second quarter of 2026 is projected to deliver 23.3% year-over-year earnings growth, continuing a streak of double-digit-plus quarterly gains. This would mark the second consecutive quarter in which S&P 500 earnings growth has exceeded 20%, a milestone that underscores the breadth and strength of corporate profitability across the index.
First-quarter results already signaled the momentum: the S&P 500 delivered blended earnings growth of 28.6% year-over-year, according to LongYield analysis. This result was more than double the 12.4% consensus forecast at the beginning of the year, demonstrating how dramatically analyst expectations have been revised upward as actual results rolled in.
Goldman Sachs raised its 2026 earnings-per-share forecast to $340 in May 2026, representing 24% annual growth, and projected $385 for 2027, representing 13% growth. The firm also raised its year-end S&P 500 price target to 8,000 from 7,600, citing earnings growth as a key driver of the index’s strength.
The current earnings cycle stands out against historical precedent. In 2021, the S&P 500 delivered 25.5% earnings growth, the highest level in the past five years. By contrast, 2022 saw earnings decline 12.7%, and 2023 recovered with 11.39% growth. The 2026 projection of roughly 24% places the year among the strongest for corporate profit expansion in the past half-decade.
Wall Street has set high expectations for the ongoing earnings season. According to FactSet, analysts are projecting 27.0% earnings growth for Q3 2026 and 24.6% for Q4 2026, suggesting that the strength may persist through year-end. The shift reflects both actual earnings beats in early quarters and rising confidence in corporate cost management and revenue growth heading into the second half.
