The S&P 500 (^GSPC) is not just beating Q1 earnings expectations. It’s blowing them up.

This earnings season is shaping up as one of the index’s strongest in 20 years, with profit growth accelerating, beat rates running hot, and analysts lifting estimates instead of cutting them.

That’s the good news.

The catch is that Wall Street may already be treating great earnings as the new floor.

Deutsche Bank is calling this “one of the best earnings seasons in 20 years,” and the charts show why. The share of S&P 500 companies beating earnings estimates is running well above normal, while quarterly profit growth is tracking near 25% — more than double the typical pace outside recessions.

FactSet’s latest scorecard tells a similar story. As of early May, 84% of S&P 500 companies had beaten earnings estimates, 81% had beaten revenue estimates, and Q1 earnings growth was tracking at 27% — up sharply from 13% at the end of the quarter.

That’s not just a low bar getting cleared. It’s the bar moving higher.

The bigger tell is what is happening to future earnings estimates. Analysts usually spend much of the year trimming forecasts as reality catches up with optimism. This time, Bank of America data shows 2026 and 2027 S&P 500 earnings estimates rising sharply instead.

Goldman Sachs highlights the same reset underway. Bottom-up consensus estimates for the next several quarters has moved higher since the start of the year, and 45% of S&P 500 companies issuing guidance have guided above consensus estimates, compared with a 40% average.

The earnings strength is also showing more breadth than investors have seen in years. Deutsche Bank notes that all 11 top-level sectors are expected to post year-over-year earnings growth for the first time in four years.

But this is where the story gets more complicated.

Index-level earnings are still heavily influenced by the biggest stocks. FactSet noted that Alphabet (GOOGL), Amazon (AMZN), and Meta (META) accounted for 71% of the past week’s increase in S&P 500 earnings dollars.

Goldman’s profit growth chart also shows a wide gap between the index overall and the typical stock, a reminder that a few giants can still bend the scoreboard.

Investors are not exactly handing out participation trophies.

Companies beating earnings estimates have been rewarded, gaining 1.2% — slightly ahead of the five-year average. But misses have been punished harder. Companies falling short are down 4.2%, compared with an average drop of 2.9%. That’s the market’s version of a high bar — good is expected, bad gets hit.