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Last earnings season, 63.7% of companies beat earnings per share estimates. This was down from the prior three quarters that saw 68% each time, and the relatively weak reading contributed to the market's woes from April to June. One thing the weakness last quarter did was lower expectations heading into this quarter. As shown in the second chart below, the net upside earnings revisions reading has been declining since the end of June. More analysts have recently been lowering earnings estimates than raising estimates. At the same time, we saw relatively few companies come out and lower guidance this past off-season. With analysts lowering estimates and the companies themselves keeping their estimates the same, it sets up a scenario where the beat rate could come in strong this earnings season.

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While just 29 companies have reported so far this earnings season, the beat rate has indeed started out pretty strong. Of the 29 companies that have released numbers, 76% have beaten earnings estimates and 85% have beaten revenue estimates. The strong beat rate hasn't really caused the stocks reporting to do exceptionally well, however. Thirteen of the companies that have reported have gone higher on the day in reaction to their reports, while 16 have gone lower. The median one-day change in response to these earnings reports has been -0.50%.

Source: Earnings Season Stats