Magnificent 7 Earnings Out this Week will Shed Light on Big Tech’s Tariff Concerns

by Christine Short of Wall Street Horizon, 4/23/25

Key Takeaways

  • With 12% of S&P 500® companies reporting for the Q1 reporting season, EPS growth currently stands at 7.2%

  • Seven companies reporting this week have advanced their earnings dates: Northrop Grumman, Capital One, 3M, ResMed, CenterPoint Energy, CBRE Group and Phillips 66

  • Q1 peak earnings season falls between April 28 - May 16

With many of the big financial reports out of the way, the S&P 500 blended EPS growth rate for Q1 stands at 7.2%. Thus far only 12% of S&P 500 constituents have released results.1

While reports for Q1 have been coming in better than expected, with 71% of companies beating bottom-line expectations and 61% beating on the top-line, that is still well below the five and ten year average beat rates. Forward-looking guidance has also been concerning, with many large caps taking a more cautious view of the economy, mostly due to tariff uncertainty.2

Uncertainty on trade policy looks to have affected what type of guidance companies are willing to give. Many have said their guidance excludes the impact of tariffs as they don’t know how to quantify those just yet. General Mills, for example, downgraded guidance for FY 2025 net organic sales, now expected to fall in the range of -1.5% to -2%, from prior guidance for flat to 1% growth. However they followed this guidance with a note that read: “Due to continued uncertainty regarding the implementation dates and scope of potential U.S. import tariffs or retaliatory tariffs put in place by other countries, this guidance does not include any impact from new tariff actions in 2025.”3 Dollar Tree did something similar when they reported on March 26. After providing a FY 2025 outlook for $18.5B - $19.1B in net sales, and $5.00 - $5.50 for adjusted EPS from continuing operations, they caveated this guidance with: “We have not reflected the impact of this second round of tariffs in our 2025 outlook as the net impact will depend on the eventual policy and the degree, scope, and timing of our mitigation efforts. The imposition of this year's tariffs has introduced uncertainty and volatility.”4

Other large cap names, like Delta, have said they can’t reaffirm prior 2025 guidance, so in effect offering no outlook at all. After downgrading 2025 guidance back in March, Delta said in their April 9 earnings release ““Given current uncertainty, Delta is not reaffirming full year 2025 financial guidance and will provide an update later in the year as visibility improves.”5