Catenaa, Sunday, August 09, 2026- Corporate America’s adoption of AI tools is contributing to margin growth, a major relief to investors who had questioned massive investments in AI.
That’s one of the key takeaways from a second-quarter earnings season that’s winding down for almost 90% of companies in the S&P 500 Index.
Some 25 firms in the benchmark gauge have quantified the impact of using AI and said the technology will amount to 180 basis points of margin growth, on average, according to an analysis conducted by 22V Research.
Excluding companies lumping AI in with other productivity improvements, the average margin boost from AI stands at 150 basis points.
It’s not just technology megacaps; garbage pickup companies, manufacturers of heating systems and insurance brokers are on the list. Extrapolating a margin improvement of this magnitude to the broader index would imply a 10% upside, at a minimum, to the S&P 500’s fair value, according to Dennis DeBusschere, President and Chief Market Strategist at the firm.
“Direction matters more than precision in these early estimates, and the direction is toward more AI users reporting better margin improvement,” DeBusschere said.
A rising number of S&P 500 companies are spelling out exactly how artificial intelligence tools are boosting their margins, and the improvements are getting larger.
In the first quarter, some 17 companies in the index outlined how AI boosted their margins, and the improvement stood at only 20 basis points, on average.
Waste Management said that its Smart Truck platform now generates more than $300 million of annual earnings before interest, taxes, depreciation and amortization through service upgrades, optimized routing and lower operating costs.
“We are also continuing to innovate for the future through AI-enabled tools, autonomous long-haul vehicles, and remote-operated heavy equipment, all of which we expect to support higher revenue capture, lower operating costs, and sustain margin expansion over time,” President John Morris said on the company’s earnings call.
Equifax CEO Mark Begor said on an earnings call in July that cost-saving and productivity benefits associated with AI have started to show up in 2026.
At logistics company CH Robinson Worldwide, AI has helped drive a 60% productivity gain since 2022.
Dozens of other companies laid out similar gains. Fortinet said its second-quarter operating margin rose 490 basis points. And Willis Towers Watson said it would see $400 million in cost savings driven “primarily by process automation.”
On an individual stock level, investors are rewarding firms that see measurable margin improvements. 22V sees Johnson Controls International’s margins expanding by 260 basis points. Its shares have climbed 11% since reporting earnings on July 29.
This eases concern that massive spending on artificial intelligence technology is failing to translate into corporate margin growth. Those fears have been further inflamed by concerns about “circular deals,” where companies like Nvidia back customers and projects that then buy their chips.
Even without quantifying AI’s effect on profit margins, a rising number of S&P 500 members expect general improvements from the technology. So far this earnings season, executives from 43 companies in the S&P 500 have said AI is contributing to their margins, according to data analyzed by Bloomberg Intelligence.
Some 85 executives have said that AI somewhat supported margin growth. On the flip side, executives in only three S&P 500 firms refuted the idea that AI was contributing to margin growth.
