The Magnificent Seven Still Matter—But 2026 Isn’t Just Their Story - Apple (NASDAQ:AAPL), Amazon.com (NASDAQ:AMZN)

For much of the past three years, the U.S. stock market has felt like a one-team sport.

A small group of mega-cap technology companies, the so-called Magnificent Seven, have dominated returns, headlines, and earnings growth.

The common assumption has been that, without this elite tech group, the broader market rally would collapse.

Since its launch in October 2023, the Roundhill Magnificent Seven ETF (NYSE:MAGS) has surged 119% — nearly three times the return of the Invesco Equal Weight S&P 500 ETF (NYSE:RSP), underscoring just how far performance at the very top of the market has pulled away from the median S&P 500 stock.

Yet Goldman's latest report points to a subtle shift: mega-caps still matter a great deal, but the next leg of market growth may no longer be driven by them alone.

Chart: Magnificent Seven Have Crushed The Median S&P 500 Stock

Mag 7 Will Drive Nearly Half of S&P 500’s Earnings Growth, But The Rest Is Accelerating

Goldman Sachs forecasts S&P 500 earnings per share of $305 in 2026, representing 12% year-over-year growth, followed by another 10% increase in 2027.

Of that 12% growth next year, Goldman estimates the seven largest stocks — NVIDIA Corp. (NASDAQ:NVDA), Microsoft Corp. (NYSE:MSFT), Apple Inc. (NASDAQ:AAPL), Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL), Amazon Inc. (NASDAQ:AMZN), Meta Platforms Inc. (NASDAQ:META) and Tesla, Inc. (NASDAQ:TSLA) — will account for 46% of total S&P 500 earnings growth.

That's an extraordinary concentration. Just 1% of index constituents, representing about 36% of market capitalization, are expected to deliver nearly half of all earnings growth.

However, that figure also marks a modest decline from 2025, when the same group contributed roughly 50% of earnings growth.

“The sustainability of exceptional margins for the largest U.S. stocks has been a long-running topic of investor debate, and recent focus on AI competition among the largest firms suggests that will remain a key debate in 2026,” the firm analyst Ben Snider said.

Goldman sees earnings growth for the other 493 stocks in the S&P 500 accelerating from 7% in 2025 to 9% in 2026.

In absolute terms, the S&P 493 group is expected to contribute more than half of total index earnings growth next year.

That marks an important shift. Earnings growth in 2025 was already broader than many investors appreciated, with the median S&P 500 company posting high-single-digit to low-double-digit gains.

In 2026, Goldman expects that breadth to improve further as macro conditions become more supportive.

Why The Rest Of The Index Is Improving

Economic growth remains the most powerful variable in Goldman's top-down earnings model, explaining more than half of historical S&P 500 EPS variation. As growth firms, cyclically sensitive sectors such as Industrials, Materials, and Consumer Discretionary are expected to see faster earnings growth.

At the same time, labor market slack and productivity gains should support profit margins — though Goldman is notably more cautious than the bottom-up consensus on the pace of margin expansion outside the largest firms.

According to Goldman Sachs, artificial intelligence will remain an important tailwind — but it won't be the only force shaping markets. While roughly 30%–40% of large firms are already using AI in some capacity, very few have seen a meaningful impact on earnings so far.

Adoption is still early, uneven, and skewed toward companies with the capital, data, and scale to deploy AI effectively.

“The process of AI adoption remains early, but large companies report more progress so far than smaller firms,” Goldman’s Snider said.

Over time, AI has the potential to materially lift aggregate earnings power. But in 2026, Goldman views it as a gradual contributor, not the dominant engine of growth.