---
title: "Is the profit advantage of the \"Seven Giants\" fading?"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/262206411.md"
description: "Tesla will release its financial report on Wednesday, kicking off the third quarter earnings season for the \"Seven Giants.\" According to FactSet analysis, NVIDIA is the only company among the \"Seven Giants\" expected to rank in the top five for earnings growth in the S&P 500, indicating that its earnings growth advantage is diminishing. In recent years, the \"Seven Giants\" have been star stocks in the S&P 500, but their period of rapid earnings growth may be nearing its end. Other major contributors to earnings growth are expected to include Eli Lilly, Intel, Boeing, and Micron Tech"
datetime: "2025-10-22T09:50:46.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/262206411.md)
  - [en](https://longbridge.com/en/news/262206411.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/262206411.md)
---

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# Is the profit advantage of the "Seven Giants" fading?

Tesla will release its financial report on Wednesday afternoon, officially kicking off the earnings season for the "Magnificent Seven" (Mag 7) in the third quarter.

**Key Points**

-   According to recent analysis by FactSet, Nvidia is the only company among the "Magnificent Seven" expected to rank among the top five contributors to S&P 500 earnings growth this earnings season.
-   In the same period last year, four companies from the "Magnificent Seven" were among the top ten contributors to total profit growth in the S&P 500.
-   The growth gap between the "Magnificent Seven" and other S&P 500 constituents has narrowed, and it is expected to further shrink over the next year.

In recent years, the "Magnificent Seven" has been the "star stocks" in the S&P 500, but the period of rapid profit growth for this group may be coming to an end.

John Bartis, Vice President and Senior Earnings Analyst at FactSet Research, stated that among the top five contributors to S&P 500 earnings growth in the third quarter, only Nvidia (NVDA), the AI chip giant from the "Magnificent Seven," is expected to make the list. In the same period last year, two companies from the "Magnificent Seven" — Nvidia and Alphabet (GOOG) — were in the top five, while two others — Amazon (AMZN) and Meta Platforms (META) — made it into the top ten.

This year, the other four companies expected to be major contributors to S&P 500 profit growth are Eli Lilly (LLY), Intel (INTC), Boeing (BA), and Micron (MU). The growth of Eli Lilly, Intel, and Boeing benefits from a "low year-over-year base" (making it easier to show growth when compared to last year's performance). On the other hand, Nvidia and Micron were already major contributors to profit growth last year, and they are expected to achieve profit growth of 53% and 157%, respectively, this year — highlighting the extent to which AI demand has become important for S&P 500 constituent companies.

**Why is this trend important?**

In 2023, Nvidia, Microsoft, Apple, Alphabet, Amazon, Meta Platforms, and Tesla were dubbed the "Magnificent Seven" due to their exceptionally strong profit growth, which is one of the core reasons for this title. In recent years, most of the stock market's gains have been driven by the growth of these seven companies. As their growth slows, the profitability of other constituent companies will take on greater importance when investors forecast future valuations for the S&P 500.

**"Magnificent Seven" growth slows, but still outperforms most companies**

After the earnings season for the "Magnificent Seven" begins, artificial intelligence (AI) will remain a core focus. Among them, Tesla (TSLA) will be the first to release its earnings report after the market closes on Wednesday; a week later, Microsoft (MSFT), Alphabet, and Meta Platforms will successively disclose their performance Apple (AAPL) and Amazon are set to announce their earnings next Thursday (around November 1st).

Analyst data from FactSet shows that the "seven giants" are expected to see a 14.9% growth in earnings for the last quarter, more than double the growth rate of the "other 493 component companies" in the S&P 500 (6.7%). Excluding Tesla, this gap is expected to widen further—affected by inflation and high borrowing costs, many consumers are unable to purchase new cars, and Tesla is anticipated to face its fourth consecutive quarter of declining profits.

According to analyst forecasts compiled by Visible Alpha, another company among the "seven giants" expected to see a year-on-year decline in profits is Amazon, but its profit drop may be less than 1%. The remaining "seven giants" that will release earnings reports in the next two weeks are expected to see profit growth ranging from 1% (Alphabet) to 10% (Microsoft) for the last quarter.

In the coming year, the "other 493 component companies" in the S&P 500 are expected to continue narrowing the earnings gap with the "seven giants." FactSet research data indicates that by the first quarter of 2026, the earnings growth rate for the "seven giants" is expected to stabilize around 15%; while the earnings growth rate for other S&P 500 component companies is expected to rise to 11% by the first quarter of 2026, ultimately reaching 14.6% by the third quarter of 2026.

Nevertheless, the "seven giants" may still exceed market expectations—they did so in the second quarter, when their earnings grew nearly 27%, easily surpassing Wall Street's forecast growth rate of 14%

### Related Stocks

- [Tesla, Inc. (TSLA.US)](https://longbridge.com/en/quote/TSLA.US.md)
- [NVIDIA Corporation (NVDA.US)](https://longbridge.com/en/quote/NVDA.US.md)
- [Intel Corporation (INTC.US)](https://longbridge.com/en/quote/INTC.US.md)
- [The Boeing Company (BA.US)](https://longbridge.com/en/quote/BA.US.md)
- [Micron Technology, Inc. (MU.US)](https://longbridge.com/en/quote/MU.US.md)
- [GraniteShares 2x Long NVDA Daily ETF (NVDL.US)](https://longbridge.com/en/quote/NVDL.US.md)
- [XL2CSOPNVDA (07788.HK)](https://longbridge.com/en/quote/07788.HK.md)
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- [YieldMax NVDA Option Income Strategy ETF (NVDY.US)](https://longbridge.com/en/quote/NVDY.US.md)
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