Stocks

Headlines

S&P 500 Earnings Growth Expected to Slow Amid Revisions

Earnings growth expectations for S&P 500 in Q1 2025 show a decline. Major companies, including Oracle and Adobe, have faced mixed results, with widespread estimate cuts affecting 13 out of 16 sectors.

Date: 
AI Rating:   5

Current Earnings Trends for S&P 500
The S&P 500 index is currently projected to see a +6.1% earnings growth in Q1 2025, which is a decrease from earlier estimates of +10.4% at the beginning of the year. This indicates a potential slowdown in growth amidst various macroeconomic concerns.

Moreover, the revisions have been broad-based, affecting 13 out of 16 sectors. This signals widespread challenges across the market, leading to concerns regarding overall market performance and stock prices.

Sector Performance
In particular, the Tech sector has been a significant growth driver in recent quarters, expecting a +12.7% earnings increase in Q1, following a high growth rate of +26.2% in the previous quarter. However, the recent trends show a pressure on Q1 estimates as well, which could influence investor sentiment negatively.

Individual Company Performance
Focusing on performances from key companies, Oracle reported earnings below expectations despite some growth momentum, particularly in backlog. However, the company’s outlook for margins and capital expenditure raises concerns about future profitability.

Conversely, Adobe exceeded earnings and revenue forecasts, but its reiterated guidance reflects a possible deceleration in growth. The stability of Adobe's earnings estimates contrasts with the downward revisions for Oracle post-release. This mixed performance from key players could create volatility in their respective stock prices.

The overall earnings picture exhibits a troubling trend, with an expectation of nearly all sectors achieving earnings growth in 2025. However, the adjustments in estimates suggest that a cautious approach may be warranted as broader market uncertainties could overshadow this growth potential.

Stocks:  ORCL ADBE COST