Despite strong headline numbers showing earnings exceeding expectations, a deeper look reveals a more mixed picture. Many companies lowered first-quarter earnings forecasts, and some bellwether stocks, like Alphabet and Microsoft, saw significant declines after reporting results. While corporate America appears healthy at first glance, concerns about growth trajectory and reliance on specific clients, especially Apple and Samsung, linger.
We're more than halfway through an earnings season that has left investors with loads to think about. First up, here are the numbers as of Thursday morning: S & P 500 companies that reported fourth-quarter results: 290+ Percentage of companies exceeding earnings expectations: 77.9% — above a 10-year average of 75% , according to FactSet Year-over-year earnings growth from corporations that have posted their results: 17% At face value, those figures show a very healthy corporate America.
The Google parent this week posted fourth-quarter earnings that beat expectations. But a revenue miss coupled with concern around the company's plans to spend a whopping $75 billion in artificial intelligence sent the stock tumbling 7% — its biggest one-day loss since Jan. 31, 2024. Microsoft suffered a similar postearnings fate, losing 6% on Jan. 30 after light revenue guidance overshadowed fiscal second-quarter results that beat expectations.
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