As the Q1 earnings season approaches, analysts are projecting a year-over-year earnings per share (EPS) growth of just 7.1% for S&P 500 companies, according to FactSet. This figure marks a decrease of 4.0% in EPS estimates since December 31, surpassing the 10-year average decline of 3.2% for a quarter. Despite this initial downturn, analysts anticipate a recovery, forecasting a 9.4% increase in Q2, a 12% rise in Q3, and an 11.4% gain for Q4. Looking further ahead, earnings growth is expected to accelerate to 11.4% for the full year of 2025 and 14.2% in 2026. However, Wall Street analysts have noted that earnings estimates for U.S. companies have been lowered for 13 consecutive weeks, with 23 of the last 27 weeks showing downward revisions, leading to concerns about the upcoming earnings reports as optimism wanes following the Federal Reserve's recent rate pause.