Powerful demand for artificial intelligence technologies is lifting earnings expectations for companies in the S&P 500.
Analysts now project full-year profit growth of 32% in 2026, a significant increase from the 24% anticipated prior to the latest reporting period, says The Kobeissi Letter.
This quarter saw 86% of S&P 500 firms surpass analyst targets, marking the highest beat rate in half a decade.
Communication Services earnings estimates jumped to 51% growth from the expected 26% at the start of the second quarter, while Consumer Discretionary forecasts rose to 32% from 12%, driven by Amazon’s (AMZN) results.
Energy and information technology sectors now face projections of 83% and 59% growth, respectively, reflecting broad gains from AI infrastructure spending.
“AI is driving astronomical profit growth.”
The Kobeissi Letter highlights that AI is now “single-handedly carrying the global economy.”
“The fact that the S&P 500 is 2.5% away from a record high despite the bond market looking like this is remarkable.
Without AI, the S&P 500 would be at least 50% lower right now.
Without the surge in oil prices, the S&P 500 would be above 9,000.”
Looking closer at artificial intelligence, The Kobeissi Letter predicts the agentic AI market is poised to witness massive growth.
“The enterprise agentic AI market is now expected to grow from $2.6 billion to $24.5 billion by 2030, increasing more than 9x.
These systems can effectively reason and execute with minimal human oversight.
By 2028, 30% of enterprise applications are expected to embed autonomous agents, per Gartner forecasts.
Adoption is expected to expand across customer service, operations, finance, HR, and cybersecurity.
The biggest shift is that AI is moving from simply assisting humans to actually executing and orchestrating work.
This could materially reduce operating costs and improve operational efficiency.
Agentic AI is a major catalyst for corporate efficiency.”
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