RESEARCH
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Earnings Grew in Ten of Eleven Sectors
A war in the Gulf and a construction boom produced most of the quarter's profit growth.
Jacob Radke
2 min read
Blended year-over-year earnings growth by S&P 500 sector for Q2 2026, with 97% of the index reported.
Source · FactSet Earnings Insight, August 28, 2026
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Markets & Investing
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Key takeaways
S&P 500 earnings grew 52% year over year in Q2 2026, the fastest pace since 2021.
Energy, Communication Services, and Consumer Discretionary led; Health Care was the only sector to decline.
Higher oil prices and the data center construction cycle explain much of the quarter’s profit growth.
S&P 500 earnings grew 52% in the second quarter, the fastest rate since 2021.
Ten of eleven sectors grew. Energy led at 146.3%, Communication Services rose 116.9%, and Consumer Discretionary 92.4%, while Health Care fell 6.5%.
The two big storylines are geopolitics and data center construction.
Oil averaged $92.55 a barrel in the quarter against $63.68 a year ago, a 45% increase. Oil refiners captured the widest profit margins of the cycle, with refining earnings rising 327% and Chevron posting its best profit in six years.
Capital spending by the largest data center operators is approaching $750 billion this year, up from under $450 billion, with 23 gigawatts of capacity being built. Nvidia and Micron sell into that investment. Semiconductor earnings rose 142%, with Micron alone earning $28 billion in the quarter against $1.9 billion a year ago.
Earnings are what drive stock market returns over time. The S&P 500 gained 18.6% over the past year while earnings grew 52%, which is not a sign of a frothy market.
Until next week,
Jacob
Sources & method
Sector and index earnings growth, oil prices, and refining earnings: FactSet Earnings Insight, August 28, 2026.
Data center capital spending and capacity under construction: BloombergNEF.
Company examples: Chevron Q2 2026 reporting and Micron fiscal Q3 2026 results, as linked in the article.
Written by
Jacob Radke
Partner, Wealth Advisor
Jacob writes the weekly charts. Jacob leads the firm’s platform, including trading, research, portfolio systems and technology. He also sits on the firm’s board and investment committee, and advises client families.
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