Earnings Growth in US Finally Showing Up Outside Tech Megacaps

BI data show S&P 500 earnings ex-Mag-7 set to grow 7.4% in 2Q
Lots of revenue misses and AI flops, but outlook is strong

Stock in the S&P 500 Index, excluding the so-called “Magnificent Seven,” are on pace to deliver their first profit growth since the fourth quarter of 2022. — Stock in the S&P 500 Index, excluding the so-called “Magnificent Seven,” are on pace to deliver their first profit growth since the fourth quarter of 2022.
Photographer: Loren Elliott/Bloomberg

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By Esha Dey

August 10, 2024 at 12:00 PM UTC

This article is for subscribers only.

As another quarterly earnings season from Corporate America enters its final stretch, this much is clear: The long-awaited recovery in the companies that were left out of the artificial-intelligence frenzy has finally begun.

Signs of the turnaround are unmissable. For several quarters, profit growth in the seven biggest technology companies was driving gains for the S&P 500 Index. That is about to change, as the rest of the stocks in the benchmark, excluding the so-called Magnificent Seven, are on pace to deliver their first profit growth since the fourth quarter of 2022, data compiled by Bloomberg Intelligence show.