Wall Street bulls are feeling highly optimistic: the S&P 500 earnings growth rate has reached a 30-year high.

In the second quarter, the S&P 500's earnings grew by 31% year-on-year, marking the strongest growth rate since the recovery phase following the recession in 1992, far surpassing the expected 23%. AI-driven profit margins surged from 14% to nearly 16%, with valuations falling from 26 times earnings to below 22 times, completing a reset. Earnings expansion has spread to small and mid-cap stocks as well as European and Asia-Pacific markets. Mark Hackett, Chief Market Strategist at Nationwide Funds Group, directly pointed out the turning point: For most companies, AI has been a cost center over the past five years, with only the very large cloud providers benefiting from stock price perspectives. This year is a turning pointAI is beginning to truly act as a profit center. According to 22V Research, AI is boosting profit margins by approximately 150 basis points. The technology sector still boasts the highest profit margins within the S&P 500, but an increasing number of companies from other industries are also beginning to quantify the benefits of AI during earnings calls. This trend is not unique to the United States. According to data from Deutsche Bank, European companies' net profit margins soared to a record 12% in the second quarter. BI data shows that European executives mentioned AI an average of over four times during earnings calls, reaching a historic peak, far above the average of 0.5 times since 2016. Barclays strategist Emmanuel Cau and others noted, Quantifiable cost and efficiency gains have become a core topic, and more management teams are beginning to discuss realized gains.