AI Companies Expected to Drive 31% Uptick in Q3 Earnings

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That’s according to a report Friday (Oct. 9) by Reuters, which noted that investors are both enthusiastic about this surge but concerned about its longevity.

Analysts are expecting a roughly 31% increase in S&P 500 earnings for the quarter, with two-thirds of that uptick coming from the tech sector and AI leaders like Google, Amazon and Meta, said Tajinder Dhillon, LSEG’s head of earnings and equity research.

Tech share increases helped drive the S&P 500 to a record high this week ahead of the earnings season, which begins this week with reports from banking giants like JPMorgan and Goldman Sachs, Reuters added.

“It’s all AI and, to a lesser extent, energy and materials, but that’s because of geopolitics,” Sameer Samana, head of global equities and real assets at Wells Fargo Investment Institute, told Reuters. “It wouldn’t surprise me if 70-80% of the growth can be attributed to tech and AI.”

Meanwhile, earnings from U.S. semiconductor providers, some of the largest beneficiaries of the AI boom, are projected to have risen 136% for the third quarter after a 158% increase in the second, Dhillon said, citing LSEG data.

“Earnings estimate revision momentum is starting to cool,” said Nick Raich, CEO of The Earnings Scout, an independent research firm. “We’re still going 100 miles an hour in the AI infrastructure buildout, but three months ago we were going 150 miles an hour.”

In other AI-related news, recent PYMNTS Intelligence research finds that companies that combine several AI tools to combat payments fraud are almost twice as likely to prevent the majority of attempted attacks before losing money.

Research from “Prevention First: Building a Smarter Defense Against Payments Fraud,” a PYMNTS Intelligence and Bottomline collaboration, finds that businesses that merge AI detection with account verification and stronger approval procedures are showing progress against sophisticated fraud.

As covered here last week, the research showed that 59% of the firms that use three or more AI tools were able to prevent 90% of fraud attempts. Only 32% of companies without AI defenses reached the same result, a 27-percentage-point difference.

“The findings suggested that successful prevention depended on several defenses working together, much like a security system that combines cameras, alarms and reinforced locks,” the report said.

The research provided examples of AI-powered safeguards working together. One business caught an attempted wire transfer to a fraudulent account after its monitoring software spotted an unexpected change. Another stopped an attempt to redirect an ACH payment when the transaction differed from the supplier’s usual activity.

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