S&P 500 EPS Growth Boosted by One-Time Event, Amazon Earnings Miss Expectations

The S&P 500's earnings per share (EPS) and revenue growth have been impressive in Q2 '26, but some of that growth can be attributed to a one-time event. For the quarter, EPS growth is up 51.1% and revenue growth is up 15.2%. However, if we exclude the impact of Anthropic's mark-ups, the S&P 500's operating EPS growth rates are 19-20%, and 32.7% for the last two quarters.

Looking at longer-term revenue estimates, Q2 '26 was initially expected to have a y-o-y revenue growth rate of 6.9%. However, the actual growth has been twice that, reaching 15.2%. This significant increase has caught many off guard, and it's essential to understand the factors driving this growth.

Amazon's latest earnings release was also affected by Anthropic's mark-ups. After removing the EPS value of the mark-up, Amazon missed its expected EPS by 55%, printing an operating EPS of $0.86 versus the $1.92 expected by the Street. Despite this, Amazon Web Services (AWS) was a bright spot in the quarter, with revenue growth reaching 37% y-o-y, the strongest since March '22.