Ross Gerber Cites Data to Make a Point: Take Out Alphabet and Amazon, S&P 500 Earnings Growth Looks Far Less Impressive
Key takeaways
- Excluding Alphabet and Amazon, the S&P 500's earnings growth rate for Q2 2026 would be 32.0%, significantly lower than the actual rate of 50.4%.
- 50.4%: S&P 500 earnings growth rate for Q2 2026
- 32.0%: S&P 500 earnings growth rate excluding Alphabet and Amazon
- 71%: Share of dollar increase in S&P 500 blended earnings since July attributed to Alphabet and Amazon
What happened
Ross Gerber highlighted that excluding Alphabet and Amazon, the S&P 500's earnings growth rate for Q2 2026 would fall to 32.0% from 50.4%, according to FactSet.
Why it matters
The concentration of earnings growth in a small number of mega-cap companies, particularly those benefiting from the artificial intelligence boom, underscores the market's overall earnings growth.
Short-term and longer-term
Short-term. Excluding Alphabet and Amazon, the S&P 500's earnings growth rate would be significantly lower, indicating that the market's overall earnings growth is heavily driven by these two companies.
Longer-term. The concentration of earnings growth in a small number of mega-cap companies, particularly those benefiting from the artificial intelligence boom, raises questions about the sustainability of the market's overall…