32% year-on-year EPS growth is now projected for the S&P 500 in Q2 2026 after a 30% jump in Q1, a back-to-back 30%+ streak seen only 10 times since 1936.
Nearly 90% of June-quarter results are in, and the strength looks broad: BofA said EPS is up 30% excluding Alphabet and Amazon investment gains, while beat rates reached 76% by its measure and 85.1% in Reuters data.
JPMorgan raised its 2026 S&P 500 EPS forecast to $365 from Street consensus of $358 and lifted its year-end index target to 8,000 from 7,800, implying about 3.1% upside from Monday's 7,753.11 close.
Cloud growth is underpinning that bullish view, with AWS up 37%, Azure 43% and Google Cloud 82% in Q2, supporting JPMorgan's thesis that AI spending is converting into revenue.
$900 billion in consensus AI capital spending by end-2026 and more than $1.2 trillion by end-2027 are expected to keep earnings momentum alive, even as JPMorgan says private-company marks added roughly $18 to reported 2026 EPS.
As record-breaking backlogs pile up, will advanced packaging bottlenecks and margin pressures ultimately derail the highly anticipated AI infrastructure supercycle?
Are we witnessing a sustainable technological revolution, or just a massive capital expenditure bubble waiting to burst if AI monetization stalls?