Goldman Sachs Sees Robust S&P 500 Earnings Momentum Extending Through 2027

Key Moments

Goldman Lays Out Earnings Path for the S&P 500

Investing.com – Analysts at Goldman Sachs anticipate that stronger U.S. economic growth, a softer U.S. dollar, and efficiency gains tied to artificial intelligence will underpin a significant rise in S&P 500 earnings next year.

In a research note, a team of strategists including Ben Snider and Ryan Hammond projected that earnings per share for companies in the benchmark U.S. equity index will grow at an annualized rate of 12% in 2026, reaching $305.

The team also expects S&P 500 revenue to expand by 7% next year, accompanied by a 70 basis point improvement in profit margins.

Looking further ahead, Goldman Sachs forecasts that S&P 500 earnings per share will increase an additional 10% in 2027, rising to $336.

Macro Backdrop: Growth and a Softer Dollar

Goldman Sachs’s outlook is anchored in its call for faster U.S. gross domestic product growth, combined with continued easing in the U.S. dollar. The analysts highlighted that the dollar index – which tracks the U.S. currency against a basket of other currencies – has fallen by more than 7% over the past one-year period.

Concentration Risk: Big Tech’s Outsized Role

The strategists emphasized that the largest constituents of the S&P 500 will remain central to the index’s overall earnings trajectory. They noted that returns generated by the seven biggest members – Nvidia, Apple, Microsoft, Google, Amazon, Broadcom, and Meta – currently represent roughly one quarter of total S&P 500 earnings.

Goldman Sachs expects this group to increase its combined earnings by 29% in 2026, a rate the analysts said is in line with their expectations for 2025. These companies have been supported by optimism that substantial spending on AI will ultimately translate into meaningful financial gains, even as some investors question the timing of those benefits.

Concerns have also emerged that heavy, often debt-financed AI investment could pressure profit margins, challenging elevated valuations across parts of the technology complex. Additionally, a wave of interconnected deals in the AI ecosystem has attracted scrutiny from some market participants.

Still, “continued strength in AI investment alongside healthy growth in other businesses will support roughly +20% sales growth for these stocks in 2026,” the Goldman analysts said.

AI as a Broader Earnings Catalyst

Beyond the contribution from the largest technology names, Goldman Sachs expects wider AI adoption to have a measurable impact on profitability across the S&P 500. The strategists estimate that AI-driven productivity enhancements will boost S&P 500 earnings per share by 0.4% in 2026 and by 1.5% in 2027.

They argued that the broader rollout of AI tools and processes across corporate America is still at an early stage. “We […] assume both corporate adoption and the realized share of the total potential productivity boost will gradually build over time,” they wrote.

Forecast Snapshot