Now that earnings season has finally wound down, it’s a good time to look back and marvel at just how far we’ve come in Q1. Between tariffs, trade wars, and plenty of “uncertainty,” everyone was bracing for a very bad quarter…but it didn’t turn out too shabby after all.
In fact, 78% of S&P 500 companies beat EPS estimates, higher than the five-year 77% average—though to be fair, that’s because a lot of companies were reporting earnings they’d reeled in pre-tariffs. Another Q1 fear that didn’t end up being that big a deal was all the fuss over companies yanking forward guidance: Only 3% of the 478 S&P 500 companies surveyed by FactSet withdrew or didn’t update their forecast for FY2025.
Despite that good news, plenty of questions remain about the future of the US economy. Mentions of “recession” appeared in 27% of 451 earnings calls by S&P 500 companies since March 15, the highest level since 2022. Wall Street analysts also slashed their second-quarter profit estimates by a wider range than average, according to FactSet, making many wonder: Will the other shoe drop in Q2?
Earnings season trends to watch
Another trend that blew up this quarter was buybacks. A bunch of big firms, including Apple, Visa, Wells Fargo, and Delta, announced plans to purchase their own shares to the tune of $233.8 billion in April—the second highest total since 1984, according to Birinyi Associates. Some see this as a sign of company confidence, others of caution. Either way, it should serve to prop up the stock market for whatever curveballs could be coming next.
Let’s not forget that Q1 was packed with plenty of weirdness and wild moments, too. Here are a few worth remembering:
- PepsiCo CEO Ramon Laguarta was grilled by a 13-year-old during his earnings call. Since it was Bring Your Child to Work Day, Jefferies analyst Kaumil Gajrawala allowed his daughter to ask how the company’s dealing with the snack slump caused by GLP-1 weight loss meds. Gajrawala then allowed his 13-year-old son to crash another earnings call that day for Keurig Dr Pepper to inquire about a new blackberry soda. Might this open the floodgates to a bunch of kids chiming in on future calls? We sure hope so.
- Chipotle plans to expand its Mexican-inspired fast food chain in 2026 to…Mexico. Can this company sell a burrito bowl to the people who invented the burrito? It didn’t work for Taco Bell, which ended up closing shop south of the border when locals didn’t bite.
- Barrick CEO Mark Bristow admitted to forking over $15 million a month to the Mali government, which took over its Loulo-Gounkoto gold mine, seized about $245 million in gold, and detained four Barick employees. Although the Canadian company has been trying to settle this dispute for over six months, its first-quarter profits still managed to surpass analysts’ estimates, thanks to a meteoric surge in gold prices.
- Sphere, the company behind the MSG sphere in Las Vegas, plans to revolutionize the entertainment industry as we know it by building…mini-spheres. These venues will seat 5,000, about one-quarter the original’s size. Given the big one lost $98.4 million in the first two months after it opened, watching what happens with its smaller doppelgangers should be entertaining, indeed.—JD