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The "Magnificent Seven" Are Still Growing Faster Than the Rest of the S&P 500. Here's When That Could Change, According to Wall Street Analysts.

Sun Jun 15, 2025

Adam Levy, The Motley Fool

6 min read

In This Article:

  • The "Magnificent Seven" produced far better earnings growth than the rest of the market in the first quarter.

  • Amazon and Alphabet were the biggest contributors to the outperformance.

  • Investors will have to consider valuation as the rest of the market catches up with the Magnificent Seven.

  • 10 stocks we like better than Nvidia ›

The S&P 500 (SNPINDEX: ^GSPC) has produced phenomenal returns over the last two and a half years since the bottom of the 2022 bear market. The index is up nearly 70% since Oct. 2022, but much of that gain has been driven by just a handful of stocks. The "Magnificent Seven" have, for the most part, outperformed the benchmark over that period, and there's a clear reason why.

As a group, the Magnificent Seven have produced much better earnings growth than the rest of the S&P 500. Not only that, they've consistently beaten high earnings expectations. That trend continued in the first quarter, but analysts are starting to think their phenomenal run of outperforming everything else in the market may come to an end soon.

Here's what investors need to know.

A sign with Nvidia's logo outside of a building with a slat-covered awning.

Image source: Nvidia.

After Nvidia (NASDAQ: NVDA) released its quarterly earnings on May 28, FactSet reported the Magnificent Seven grew earnings 27.7% in aggregate. That massively outperformed analysts' expectations of 16.0% earnings growth for the group. Here's how it breaks down:

  • Amazon (NASDAQ: AMZN): $1.59 earnings per share (EPS) vs. $1.36 expected, up 62% year over year.

  • Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL): $2.81 EPS vs. $2.01 expected, up 49% year over year.

  • Meta Platforms: $6.43 EPS vs. $5.22 expected, up 37% year over year.

  • Nvidia: $0.81 EPS vs. $0.75 expected, up 33% year over year.

  • Microsoft: $3.46 EPS vs. $3.22 expected, up 18% year over year.

  • Apple: $1.65 EPS vs. $1.62 expected, up 8% year over year.

  • Tesla (NASDAQ: TSLA): $0.27 EPS vs. $0.41 expected, down 40% year over year.

Six out of the seven outperformed expectations, and five of them grew earnings faster than the other 493 companies in the S&P 500 (9.4%). But as you can see, the level of outperformance and year-over-year growth varies widely from company to company.

The weakest showing was most obviously from Tesla, which has suffered from political backlash against CEO Elon Musk, combined with rising competition from Chinese automaker BYD. As a result, deliveries dropped 13% year over year in the first quarter while average selling price also declined. The company's ramp-up in AI spending to support its forthcoming autonomous vehicle efforts also weighed on earnings results.