Revenue Growth
Revenue Growth shows how fast a company’s sales are rising or falling compared with the same period a year earlier.
How it is calculated
(Revenue − Revenue a year earlier) ÷ |Revenue a year earlier|
Quarterly and TTM figures are compared with the same period a year earlier. Shown as 0 when the earlier value is 0.
- Unit
- Percent change
- Periods
- TTM, Quarterly, Annual
- Source
- Calculated by stockrow from the inputs below
- Made from
- Revenue
Reading Revenue Growth
How to read it
Revenue growth compares this period’s revenue with revenue a year earlier: the change is divided by the absolute value of the earlier figure, so the result is a percent change. The numerator moves with anything that lifts or cuts sales — more customers, higher prices, acquisitions, currency moves or lost business. The denominator is last year’s revenue, so a small base makes any change look large. A positive value means sales grew; a negative one means they shrank.
What is typical
Growth rates differ with the kind of business and the stage it is at. Young companies and those in expanding markets can grow quickly from a small base, while large, mature businesses such as utilities and consumer staples tend to move slowly and steadily. Cyclical businesses can swing between growth and decline with the economy. Compare a company with the median for the company’s sector rather than with the market as a whole.
Pitfalls
On stockrow, quarterly and trailing-twelve-month figures are compared with the same period a year earlier, not with the previous quarter, so seasonality does not distort them. When revenue a year earlier was zero, stockrow shows the growth as zero, which can hide a company that has just started selling. Acquisitions and disposals can make growth look stronger or weaker than the underlying business.