S&P 500 Energy Sector Earnings Poised to Lead Q3 with 128% EPS Growth, Double Tech's Rate

The S&P 500 energy sector opens the third-quarter earnings season on Tuesday, with consensus estimates projecting 128% year-over-year EPS growth—roughly double the technology sector's rate, according to FactSet data. The growth rate trails the second quarter's 146% increase, when Brent crude averaged $98 a barrel versus $91 in the third quarter. Analysts had earlier expected the Iran conflict to cool by mid-summer, but fighting continues without a clear end in sight, making the sustained earnings growth more notable. Several energy names, including ExxonMobil (XOM), trade at or near record highs, raising expectations for further gains. The key question is how companies will deploy cash and whether they will expand drilling activity. Halliburton (HAL), the largest U.S. shale oilfield services provider, reports Tuesday. Consensus sees EPS flat at 58 cents year-over-year—still outperforming the broader oilfield equipment and services subsector, the only energy category expected to post an average EPS decline. U.S. onshore rig counts have risen 10% this year after years of contraction. Halliburton has also reached preliminary agreements to provide services in Venezuela, a potential catalyst.