Second-quarter earnings season is running ahead of expectations, according to the latest FactSet update from analyst John Butters. With roughly two-thirds of S&P 500 constituents reporting, 82% have beaten consensus earnings-per-share estimates—the highest proportion since the third quarter of 2021 and above the five- and ten-year averages of 78% and 75%, respectively. The blended year-over-year EPS growth rate has climbed to 10.3%, more than doubling the 4.9% pace recorded at the end of June and marking a third straight quarter of double-digit profit growth. About 79% of companies have also topped revenue forecasts. Stronger results are starting to filter into outlooks. Analysts now look for calendar-year 2025 S&P 500 profits to rise 9.9%, and for earnings in the third and fourth quarters of 2025 to expand 7.6% and 7.0%, respectively. Even so, valuation measures remain elevated: the forward 12-month price-to-earnings multiple stands at 22.2, above its five- and ten-year averages, while the cyclically adjusted price-earnings ratio sits near 38. The market’s rich pricing underscores investor confidence that the momentum in corporate earnings can be sustained into next year.