The S&P 500's composite net profit margin for the third quarter is currently at 14.9%, poised to be the second-highest level since FactSet began tracking the metric in 2009.
Six sectors are expected to see year-over-year increases in net profit margins in Q3, with the energy and information technology sectors leading the way. The energy sector's net profit margin is 15.4% (up from 8.1% in the same period last year); the information technology sector's is 32.3% (up from 27.5% in the same period last year). Five sectors are expected to see year-over-year decreases in net profit margins, with the financial and healthcare sectors showing the most significant declines. The financial sector's net profit margin is 20.0% (up from 20.5% in the same period last year); the healthcare sector's is 7.5% (up from 7.9% in the same period last year).
Seven sectors are expected to have net profit margins above their five-year average, with the information technology and energy sectors leading the way. The information technology sector's net profit margin is 32.3% (up from a five-year average of 25.9%); the energy sector's is 15.4% (up from a five-year average of 10.1%). Three sectors are expected to have net profit margins below their five-year average, with the healthcare and real estate sectors showing the most significant declines. The healthcare sector has a net profit margin of 7.5% (five-year average 8.7%), while the real estate sector has a margin of 34.2% (five-year average 35.2%).
Analysts expect the S&P 500's net profit margin to be higher than the current 14.9%, with projected margins of 15.2% in Q4, 15.9% in Q1 of 2027, and 16.3% in Q2 of 2027.
