The outlook for corporate earnings has received a material boost from the very strong quarterly results in the ongoing Q1 earnings season. We should keep in mind, however, that the earnings picture was fairly strong coming into this reporting cycle already.
We believe that it is this broad-based and steadily improving earnings outlook that is helping the market discount the drag from geopolitical headwinds.
Including all of this morning's results, we now have Q1 results from 288 S&P 500 members or 57.6% of the indexes total membership. Total earnings for these companies are up +24.4% from the same period last year on +11.2% higher revenues, with 77.4% beating EPS estimates and 77.8% beating revenue estimates.
This is a materially showing from these 288 index members relative to what we have been seeing from this group in other recent periods. The outperforming is particularly notable in terms of earnings and revenue growth and the revenue beats percentage.
The Magnificent 7 companies have been in the spotlight at present following quarterly results from four of the group's members - Alphabet GOOGL, Amazon AMZN, Meta META, & Microsoft MSFT. All of these Tech leaders came out with strong results, but the numbers from Google's parent Alphabet are truly impressive, outshining its mega- cap Tech peers that are also its competitors in the fast-emerging AI world.
The Alphabet report shows all-around strength in the company's businesses, but the momentum in Google's cloud computing unit has been very impressive. Amazon's results were also very strong, with continued momentum in its Amazon Web Services business unit.
The Q1 quarterly results from these Mag 7 members reconfirm these companies' leadership status. This leadership reflects not only the enormous sums that these companies are deploying to build data centers and other AI infrastructure, but also their enormous earnings power.
For a complete read on the Q1 earnings season and evolving expectations for the coming periods, please check out our weekly Earnings Trends report here >>>>> A Strong & Steadily Improving Earnings Picture
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Amazon.com, Inc. (AMZN): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).