Mag 7 Earnings Preview: What Can Investors Expect?

Group 1 - The Q1 earnings season is underway with over 800 companies reporting results, including four members of the Magnificent 7 and 173 other S&P 500 members [1][19] - The Magnificent 7 stocks have recently participated in the market rebound but have struggled this year, particularly during the market sell-off since February 2025 [2][3] - Microsoft has outperformed the S&P 500 index during the recent market sell-off, while Apple, Amazon, and Meta have lagged behind [3][4] Group 2 - The performance of the Magnificent 7 members varies significantly depending on the time frame considered, with Meta and Apple showing strong performance over the past year, while Amazon and Microsoft lag [4] - All members of the Magnificent 7 are leaders in the artificial intelligence space and are investing heavily in data centers and related infrastructure [5] - Despite skepticism regarding the economic value of their investments, these companies are maintaining their capital expenditure plans [6] Group 3 - The Magnificent 7 members are exposed to trade uncertainties, which could impact their performance due to potential recession risks [7][10] - Earnings expectations for the Magnificent 7 group indicate a projected increase of +19.6% in Q1 2025 compared to the same period last year, with revenues expected to rise by +10.9% [11][25] - Recent estimates for the Magnificent 7 have come under pressure, with expected earnings growth for the year revised down from +15.7% to +9.9% [14][34] Group 4 - As of April 25, 2025, 179 S&P 500 members have reported Q1 results, showing an overall earnings increase of +18% and revenue gains of +4.2% [21][24] - The percentage of companies beating EPS estimates is 69.8%, which is below the historical average of 79.1% [24] - Estimates for Q1 as a whole suggest earnings will rise by +9.4% and revenues by +4% compared to the previous year [25][28]