U.S. Equity Strategy: 1Q26 Earnings Learnings: Growth kicks into high gear

Research evidence excerpt

U.S. Equity Strategy: 1Q26 Earnings Learnings: Growth kicks into high gear

Equity Research

27 May 2026

U.S. Equity Strategy

1Q26 Earnings Learnings: Growth

kicks into high gear

Earnings surprised decisively to the upside, led by outsized

Tech strength and record-high beat breadth, thought muted Venu Krishna, CFA

reactions to beats and outsized reactions to misses hint at +1 212 526 7328 venu.krishna@barclays.com

even higher buy-side estimates. Revisions continue to trend BCI, US

upward, supported by AI-driven capex. Rex Feng

+ 1 212 526 6114

rex.feng@barclays.com

BCI, US

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• Earnings season was strong this quarter with impressive headline numbers... Aggregate

EPS rose 19.0% Y/Y, while sales growth came in at a solid 8.8%. Big Tech EPS growth remained

robust at 30.0%, led by GOOGL, while the rest of the Tech sector posted a 50.1% Y/Y EPS

growth (strongest since 2Q10) and a 15.1% EPS surprise (strongest since 2Q20). This helped

offset below-average growth elsewhere.

• ...with breadth of earnings surprises also reaching post-COVID highs. 87.1% of companies

beat consensus estimates, up from 74.7% last quarter and the highest overall beat rate since

2Q21. Breadth of surprise this quarter was materially better than the 80.6% post-Covid

median and the 75% long-run median (since 1998). Still, markets appeared to penalize misses