'Soft' earnings season for Australia's major companies

Australia's listed corporations snapped a three-year streak of declining earnings this profit season, but their gains lagged those of their global peers, particularly in the US tech sector.

"It was quite a soft earnings season," VanEck senior portfolio manager Cameron McCormack told AAP.

Australia's benchmark S&P/ASX200 index - which reflects most of the companies that reported in August - only marginally beat expectations, although small and mid-sized companies did better.

But the materials sector grew earnings by nearly 30 per cent, and was amongst the best sectors in terms of exceeding expectations.

"A key driver was really strength from goldminers seeing an increase in profit margins coming through, and also particularly exposures to copper miners as well, given that both gold and copper had reached an all-time high," Mr McCormack said.

Results from the banks - even though Commonwealth Bank was the only major that reported - were actually "quite solid" despite their forward earnings guidance being a bit weaker.

A key takeaway was that new mortgage applications were down around 15 per cent following federal government housing-related tax changes announced in May, Mr McCormack added.

Overall earnings growth was driven mostly by Australia's resource sector, Morningstar market strategist Lochlan Halloway agreed.

"If we think about the two main stories of earnings season, it's like resources stocks, and everything else," he told AAP.

While the miners collectively grew earnings by around 30 per cent, most industrial companies and banks' earnings climbed by just mid-single digits.

Mr Holloway did give credit to Woolworths for a standout performance, flipping the narrative from a year ago when Coles seemed to be gaining ground on its larger rival.

But overall earnings growth for Australian companies was lacklustre compared to the United States.

Wall Street's Nasdaq-100 index - which reflects technology companies like Nvidia, Apple, Amazon and Tesla - grew earnings by 38.8 per cent in 2025/26.

AMP deputy chief economist Diana Mousina was a bit more enthusiastic about Australian companies' results this season, although she acknowledged that earnings growth was quite limited and came mostly from the resource sector and banks.