In spite of extreme resistance from even GOP Congress members and popular legacy media narratives about the alleged havoc that the Trump tariffs and, more recently, military adventurism in the Middle East would wreak on U.S. business interests, the numbers tell a slightly different story.
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Via The Economist (emphasis added):
Over the past seven weeks the tales being swapped have been of war in Iran, its effect on global energy markets and presidential social-media activity. The S&P 500, America’s benchmark index of stocks, has moved up and down with Donald Trump’s estimates of the odds of an end to the conflict…
Sometimes, though, hard data trumps any narrative. And for American stocks, the relevant numbers have been remarkably strong.
Corporate profit margins, buoyed by the tech sector, reportedly reached an all-time high watermark in the fourth quarter of 2025.
Via FactSet Insight (emphasis added):
Given concerns in the market about tariffs and higher costs, what is the S&P 500 reporting for a net profit margin for Q4?
The blended net profit margin for the S&P 500 for Q4 2025 is 13.2%. If 13.2% is the actual net profit margin for the quarter, it will mark the highest net profit margin reported by the index since FactSet began tracking this metric in 2009. The current record (going back to 2009) is 13.1%, which occurred in the previous quarter.
At the sector level, four sectors are reporting a year-over-year increase in their net profit margins in Q4 2025 compared to Q4 2024, led by the Information Technology (29.0% vs. 26.8%) and Industrials (12.5% vs. 10.7%) sectors. On the other hand, six sectors are reporting a year-over-year decrease in their net profit margins in Q4 2025 compared to Q4 2024, led by the Real Estate (33.5% vs. 35.1%) sector. One sector (Energy) is reporting no change in net profit margin (7.8%) in Q4 2025 compared to Q4 2024.
Five sectors are reporting net profit margins in Q4 2025 that are above their 5-year averages, led by the Information Technology (29.0% vs. 25.0%) and Industrials (12.5% vs. 9.3%) sectors. On the other hand, six sectors are reporting net profit margins in Q4 2025 that are below their 5-year averages, led by the Health Care (6.9% vs. 9.2%) and Real Estate (33.5% vs. 35.8%) sectors.
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In addition to profit margins, the S&P 500 also clocked record overall profit increases of 28.2% from one year prior in the first quarter of 2026, the largest spike since the fourth quarter of 2021.
Via Reuters (emphasis added):
A humming U.S. corporate profit engine is at the heart of the U.S. stock market’s rally to record highs – an encouraging sign for investors as long as the fuel driving profits keeps flowing.
More than two-thirds through the first-quarter reporting season, S&P 500 companies are on track for their highest quarterly earnings growth in more than four years…
Investors had expected generally solid results when the reporting season kicked off last month, but they have far surpassed expectations. S&P 500 earnings are expected to have jumped 28.2% in the first quarter from a year earlier, including results from 350 index companies that have reported and analysts’ estimates for those yet to report, according to data as of Tuesday from Tajinder Dhillon, head of earnings and equity research at LSEG Data & Analytics.
That increase would be the highest since the fourth quarter of 2021, when businesses were recovering from pandemic lockdowns.
“Excluding special factors like favorable base effects and corporate tax cuts, earnings growth is arguably the strongest in two decades,” Binky Chadha, chief U.S. equity strategist at Deutsche Bank, said in a note.
Projections for the rest of 2026 are also rising. S&P 500 earnings are expected to jump 22.6% for the full year 2026, with estimates higher for each of the next three quarters than they were on April 1, according to LSEG IBES.
Even so, for its part, The Newspaper of Record is seemingly unimpressed, cautioning that “profits this far above the historical norm tend to generate pushback” and predicting that the theoretical collective impact of the factors that may have driven those record corporate profits will create negative electoral consequences for the party in charge — a prediction, we can safely assume, it would not have made were the same statistics released under the Biden regime.
