Corporate America is moving past recession fears, even as U.S. tariffs rise to levels not seen in over a century. In a striking shift, executives have largely stopped mentioning economic downturns in earnings calls — a signal of renewed confidence amid strong earnings and resilient markets.
Sharp Drop in Recession Mentions
According to FactSet, only 16 companies in the S&P 500 mentioned the word “recession” during second-quarter earnings calls — down dramatically from 124 mentions in Q1, and far below the 10-year average of 61.
“Recession was uttered just 16 times this quarter (4%), the lowest since Q4 2021,” noted Neil Sethi, managing partner at Sethi Associates, in a post on X citing FactSet data.
This marks a rapid turnaround in corporate sentiment, as recession worries that dominated the start of 2026 have largely evaporated.
Tariffs Reach 100-Year High, But Worry Eases
The shift in tone comes even as trade tensions intensify. President Donald Trump recently introduced a sweeping new round of tariffs — expanding on measures first announced in April — in a push to revive domestic manufacturing.
The result: the average U.S. tariff rate has surged to 20.1%, the highest sustained level since the 1910s, according to estimates from the World Trade Organization and International Monetary Fund.
Despite the trade policy escalation, executives appear unconcerned about long-term economic damage — possibly expecting future negotiations to temper the current tariff regime.
Markets and Crypto Rally Strongly
Investor sentiment remains upbeat. Since dipping in early April, the S&P 500 has surged 28%, while Bitcoin has soared 62%, rising from approximately $75,000 to $122,000, according to CoinDesk.
Analysts at JPMorgan say traders are focusing on strong corporate earnings and signs of recovery after a temporary slowdown — rather than pricing in recession risk.
Q2 Earnings Season Delivers
So far, over 80% of S&P 500 companies have reported second-quarter results. Among them, more than 80% beat earnings estimates, while 79% exceeded revenue forecasts — the strongest overall earnings performance in four years.
Bottom Line:
Even with tariff levels at a century high, both corporate leaders and markets appear unfazed. With earnings exceeding expectations and economic signals stabilizing, the conversation has moved on from recession — for now.
