Earnings season unofficially kicks off today after the closing bell when Alcoa (NYSE:AA) releases results for the fourth quarter. Current estimates paint a picture of two earnings seasons in a couple of regards. Yes, profit growth is expected to continue coming in strong for the S&P 500, currently estimated at 8.8%, a bit of a taper from last quarter’s 11.7%. However, revenues, which seemingly had been improving over the last two quarters, drop back down into the low single digits with growth anticipated at 1.9%.

After Q2 and Q3 each turned in nearly 5% top-line growth, many thought things might be improving on the sales front. All this data tells us is that share buybacks and focused cost management plans are going to continue to impact this quarter’s bottom-line results. Last quarter saw a 16% year-over-year increase in share repurchases, with 75% of the companies in the S&P 500 participating.

Q4 Earnings Themes

Other themes this quarter will certainly be weakness in Europe, a concern for the last few quarters. While the region seemed to be in slow recovery mode in mid-2013, when GDP finally rolled over into positive territory after 8 quarters of negative and flat results, stagnant growth of 0.1 – 0.3% over the last 6 quarters have US multinationals worried again. Nearly 15% of all S&P 500 revenues are derived from Europe, and last quarter we saw a good chunk of those companies mentioning the region as the weakest of all of their operations. As deflation continues to ravage the already fragile recovery, Draghi’s hints of implementing a QE program could be a game-changer in 2015.

While China will likely be a topic amongst this quarter’s releases, the region is less likely to have as negative an impact despite continual softening seen there. Third quarter GDP dipped to 7.3%, the lowest the country has seen in 5 years. While China is moderating, we haven’t seen any great impact on profits yet as a result. In fact, many companies such as Apple (NASDAQ:AAPL), Alcoa and Nike (NYSE:NKE) mentioned China as a bright spot in third quarter earnings, with only McDonald’s (NYSE:MCD), Yum! Brands (NYSE:YUM) and others with food chain supply and food quality issues noting a downtick.

And as the global picture remains mixed, the U.S. dollar has continued to strengthen against currencies in less stable economies such as the Euro and Yen. Just last week the Euro fell to nearly 9-year lows against the dollar. During the third quarter many companies factored the impact of a stronger dollar into fourth quarter and full year guidance.

Sectors: Winners & Losers

Taking charge this quarter will be the health care sector, expecting profit growth of 23.7% and revenues of 8.7%. High estimates are mainly driven by the biotech industry, once again on a tear this quarter, in most part due to Gilead Sciences (NASDAQ:GILD). The company has been wildly successful over the last few quarters due to sales of its Hepatitis C drug, Slovaldi, is looking to increase their dominance even more in the fourth quarter as earnings are expected to increase a whopping 350%. Just this October, the company was approved to sell it’s newest Hep C drug, Harvoni, a one pill regimen. And last week, two more wins for the company as they penned exclusive deals with CVS and Anthem which will carry Slovaldi and Harvoni as their primary Hep C drug.

The sector with the next highest growth rate for the quarter is telecommunication services, but I wouldn’t go as far as to call it a “winner.” The sector is expecting high earnings growth of 17.3% and revenues of 4.0%, but due to telecom’s small size (only containing 6 companies) it doesn’t have much of an impact on the overall S&P 500 index. Level 3 communications is newly added to the sector, inducted in the S&P 500 in October. That one company is expected to be up 450%. Other winners include AT&T (NYSE:T) and Verizon (NYSE:VZ), anticipated to grow 20% and 15%, respectively.

It’s no surprise consumer discretionary will be one of the big winners as well, with an improving economy, jobs numbers, and lower gas prices all leading to a rise in consumer confidence. With consumer sentiment becoming increasingly more positive, the holiday shopping season was the best in 3 years, and the overall consumer discretionary sector is expected to see profit growth 10.3% in Q4 and only 4% on the top-line. Earnings winners include internet retailers expected to increase 15%, leisure up 16.5%%, and automobiles up 17.9%.

Other sectors poised to benefit from lower oil prices include industrials as well. The sector is anticipated to post bottom-line growth of 10.2% with revenues of 2.5%. Airlines and air freight and logistics lead the pack with profits expected to grow 28.5% and 27.5%, respectively. Logistics companies like FedEx (NYSE:FDX) and UPS (NYSE:UPS) admittedly have reaped the rewards of lower fuel costs, while airlines, which typically pass fuel surcharge savings onto customers have instead increased flight fares and padded the bottom-line.

Undoubtedly, the energy sector is the biggest and only laggard this quarter. With crude oil falling 40% over the course of the quarter, oil, gas and consumable fuels companies are expected to take a big hit, with profits estimated to be down 16.6% and revenues down 12.7% for the fourth quarter. Despite big losses, they are being offset due to the benefit to several other sectors, creating a net positive effect.

Beat/Match/Miss

At this point only 21 S&P 500 companies have reported for the quarter, 62% have beat the Estimize EPS consensus, 24% have missed and 14% have matched. On the revenue front, 62% of companies have beat the Estimize consensus and 38% have beat. By comparison, a much larger 81% of companies have beat the Wall Street EPS consensus, 10% have missed and 9% have met, while 67% have beat the revenue consensus and 33% missed.

This week 18 more S&P 500 companies are scheduled to report, including the big banks: JPMorgan (NYSE:JPM), Wells Fargo (NYSE:WFC), Bank of America (NYSE:BAC), CitiGroup (NYSE:C) and Goldman Sachs (NYSE:GS).