Citi Signals End of 'Magnificent Seven' Era, Growth Cohort Contributes Nearly Half of S&P 500 Earnings

According to Citi's latest report, the "Magnificent Seven" technology stocks are no longer a suitable framework for evaluating large-cap growth momentum, and the firm is shifting focus to a broader "Growth Cohort" spanning six industries. The Magnificent Seven ETF (MAGS-US) has gained only 1% year-to-date in 2026, significantly trailing the S&P 500's 9% advance.

Citi's Growth Cohort, representing about half the S&P 500's market capitalization, is projected to contribute approximately 48% of the index's enterprise earnings over the next 12 months. The cohort advanced 24.7% in Q2 and 11.8% year-to-date, outperforming the broader index's respective gains of 14.9% and 10.1%. The firm estimates that roughly 55% of S&P 500 components are directly exposed to AI trends, with semiconductor and hardware demand supported by ongoing AI capital expenditure.