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Note: The following is an excerpt from this week’s Earnings Trends report. You can access the full report that contains detailed historical actual and estimates for the current and following periods, please click here>>>
Here are the key points:
We are off to a strong start to the Q1 earnings season, with companies not only comfortably beating consensus estimates but also providing a reassuring read on the economy despite elevated energy costs and other risks. The momentum is particularly notable on the revenues side at this early stage in the reporting cycle, both in terms of the growth pace as well as the beats percentages.
For the 32 S&P 500 companies that have already reported Q1 results, total earnings are up +30.5% from the same period last year on +13.2% higher revenues, with 78.1% beating EPS estimates and 84.4% beating revenue estimates. The earnings and revenue growth rates, and revenue beat percentages, for these companies are notably above what we have seen from this group in other recent periods.
For the Finance sector, we now have Q1 results from 34% of the sector’s market capitalization in the S&P 500 index. Total earnings for these companies are up +18.3% from the same period last year on +11.5% higher revenues, with 90% beating EPS estimates and 80% beating revenue estimates. These Q1 results compare favorably with what we have seen from this same group of companies in other recent periods.
Looking at Q1 as a whole, combining the actual results from the 32 index members that have reported with estimates for the still-to-come companies, total S&P 500 earnings are currently expected to increase by +13.9% from the same period last year on +9.5% higher revenues. This would follow the +14.1% increase in earnings on +9.1% higher revenues in the preceding period (2025 Q4).
Bank Earnings in Focus as Q1 Earnings Season Takes the Spotlight
It is still early in the Q1 reporting cycle, with results from only 32 S&P 500 members out at this stage. But we are nevertheless off to a great start, with companies comfortably beating consensus estimates that had actually moved higher ahead of the start of the earnings season and providing a reassuring read on underlying business trends.
High oil prices as a result of the Middle East conflict have undoubtedly increased risks to the outlook. But the U.S. economy remains in stable condition, as reiterated by management teams at JPMorgan (JPM - Free Report) , Wells Fargo (WFC - Free Report) , and other banks that came out with better-than-expected quarterly results. JPMorgan came out with top- and bottom-lines beats, with earnings up +12.6% from the same period last year on +10% higher revenues. Earnings and revenues at Wells Fargo were up +14.6% and +6.4%, respectively, while the bank missed estimates on both counts.
Net interest income (NII) increased +9% at JPMorgan for the quarter, though the bank’s full-year 2026 NII guidance was a hair on the lighter side. Net interest income at Wells Fargo increased +5% from the same period last year, with the bank reiterating full-year guidance. Both JPMorgan and Wells Fargo enjoyed strong growth in their loan portfolios, up +11% at each bank.
Total Q1 earnings for the Zacks Investment Banks/Managers industry, of which JPMorgan, Citigroup (C - Free Report) , and Wells Fargo are a part, are expected to increase by +19.7% from the same period last year on +10.5% higher revenues, as the table below shows.
Image Source: Zacks Investment Research
For the Finance sector as a whole, Q1 earnings are expected to increase by +26.7% on +9.8% higher revenues, which will follow the sector’s +17.3% earnings growth on +7.4% higher revenues in the preceding period.
The chart below shows the earnings and revenue growth picture for the Zacks Finance sector on a quarterly basis.
Image Source: Zacks Investment Research
The chart below shows the sector’s earnings growth picture on an annual basis.
Image Source: Zacks Investment Research
The Finance sector is the second largest earnings contributor to the S&P 500 index, behind only the Tech sector, accounting for 17.2% of the index’s expected forward 12-month earnings.
The Earnings Big Picture
The chart below shows S&P 500 expectations for 2026 Q1 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
An interesting development on the revisions front has been the evolution of full-year 2026 estimates since the start of the Iran war. No surprises in the trend reversal in Energy sector estimates since the start of March, but estimates for 8 other sectors have also moved higher in that time period. The Tech sector’s positive revisions trend has continued in this period, while the revisions trends for the Basic Materials and Consumer Staples sectors shifted from negative to positive since the start of March.
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Q1 Earnings Season Starts off Strong
Note: The following is an excerpt from this week’s Earnings Trends report. You can access the full report that contains detailed historical actual and estimates for the current and following periods, please click here>>>
Here are the key points:
Bank Earnings in Focus as Q1 Earnings Season Takes the Spotlight
It is still early in the Q1 reporting cycle, with results from only 32 S&P 500 members out at this stage. But we are nevertheless off to a great start, with companies comfortably beating consensus estimates that had actually moved higher ahead of the start of the earnings season and providing a reassuring read on underlying business trends.
High oil prices as a result of the Middle East conflict have undoubtedly increased risks to the outlook. But the U.S. economy remains in stable condition, as reiterated by management teams at JPMorgan (JPM - Free Report) , Wells Fargo (WFC - Free Report) , and other banks that came out with better-than-expected quarterly results. JPMorgan came out with top- and bottom-lines beats, with earnings up +12.6% from the same period last year on +10% higher revenues. Earnings and revenues at Wells Fargo were up +14.6% and +6.4%, respectively, while the bank missed estimates on both counts.
Net interest income (NII) increased +9% at JPMorgan for the quarter, though the bank’s full-year 2026 NII guidance was a hair on the lighter side. Net interest income at Wells Fargo increased +5% from the same period last year, with the bank reiterating full-year guidance. Both JPMorgan and Wells Fargo enjoyed strong growth in their loan portfolios, up +11% at each bank.
Total Q1 earnings for the Zacks Investment Banks/Managers industry, of which JPMorgan, Citigroup (C - Free Report) , and Wells Fargo are a part, are expected to increase by +19.7% from the same period last year on +10.5% higher revenues, as the table below shows.
Image Source: Zacks Investment Research
For the Finance sector as a whole, Q1 earnings are expected to increase by +26.7% on +9.8% higher revenues, which will follow the sector’s +17.3% earnings growth on +7.4% higher revenues in the preceding period.
The chart below shows the earnings and revenue growth picture for the Zacks Finance sector on a quarterly basis.
Image Source: Zacks Investment Research
The chart below shows the sector’s earnings growth picture on an annual basis.
Image Source: Zacks Investment Research
The Finance sector is the second largest earnings contributor to the S&P 500 index, behind only the Tech sector, accounting for 17.2% of the index’s expected forward 12-month earnings.
The Earnings Big Picture
The chart below shows S&P 500 expectations for 2026 Q1 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
An interesting development on the revisions front has been the evolution of full-year 2026 estimates since the start of the Iran war. No surprises in the trend reversal in Energy sector estimates since the start of March, but estimates for 8 other sectors have also moved higher in that time period. The Tech sector’s positive revisions trend has continued in this period, while the revisions trends for the Basic Materials and Consumer Staples sectors shifted from negative to positive since the start of March.