AI will ignite the US earnings season! Wall Street: S&P 500 second-quarter profits are expected to soar by 22%

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The artificial intelligence investment boom and rising energy prices are jointly injecting strong momentum into a new round of earnings season for US stocks.

Goldman Sachs strategists, in their latest research report, predict that the S&P 500 constituents’ second-quarter earnings will soar by 22% year-on-year, and believe that companies overall are capable of reaching or exceeding this target.

This team, led by Ben Snider, points out in the report that the core driving force behind this year's US stock rally is unexpected corporate earnings, and the upcoming earnings season will be an important catalyst for the market’s direction. Independent analysis from Bloomberg Industry Research closely aligns with this view, estimating second-quarter profit growth at about 23%, close to the impressive performance of the previous quarter.

For investors, the most critical question now is: AI investment is quickly spreading beyond tech giants—have these investments begun to translate into actual returns? Goldman Sachs strategists estimate that stocks related to AI infrastructure will contribute nearly 60% of the S&P 500’s second-quarter earnings per share growth, with Micron and Nvidia alone possibly accounting for more than 40% combined.

AI Infrastructure: The Core Engine of Earnings Growth

The Goldman Sachs report clearly identifies the AI investment boom as the primary theme of this earnings season. The strategists write, the second-quarter earnings “will again confirm strong profit growth, supported by robust macro fundamentals and a sustained AI investment boom.”

The report particularly emphasizes that the current market focus is not the performance of the tech giants themselves—after all, the AI spending of hyperscale cloud companies is already well known—but whether broader companies in the supply chain can achieve profitable returns from AI demand. Whether the AI infrastructure sector can actually deliver nearly 60% of the EPS contribution will be a crucial test of this logic.

Energy Sector: Oil Price Surge Brings Windfall

High oil prices are providing another important growth theme this earnings season. Goldman Sachs strategists point out, the rise in crude oil prices in the second quarter is expected to bring significant windfall profits to oil producers, forming a key support for earnings growth.

However, the flip side deserves equal attention: cost pressures are being transmitted to consumer companies. Goldman’s data shows, for the median S&P 500 company, the consensus market expectation for profit growth is about 9%, far below the overall index’s 22%. “Growth expectations across sectors and individual stocks are highly differentiated,” the strategists write, which means this earnings season’s structural divergences will be especially prominent.

Goldman’s optimistic outlook is based on an already strong first quarter reporting base. S&P 500 constituents saw first-quarter profit growth close to 30% year-on-year, more than double analysts’ prior expectations of about 12%. Goldman notes that the last time such high-speed year-on-year profit growth was achieved outside of a major economic shock recovery was twenty years ago, in 2004.

This historical comparison highlights the unusual strength of the current profit cycle, and sets a higher benchmark for whether momentum can continue in the second quarter. The prevailing analyst expectation is that 22%-23% growth will make this another super-strong earnings season after Q1; but whether expectations will again be greatly surpassed depends on each company’s performance.

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