Revenue Growth

RECENT NEWS
Wall Street Journal  1 hr ago  Comment 
Givaudan reported a 15% rise in full-year earnings and forecast more revenue growth this year underpinned by sales in emerging markets where the world’s largest fragrance and flavor maker has continued to expand.
Benzinga  Jan 27  Comment 
Dover Corp. (NYSE: DOV) reported stronger-than-expected earnings for the fourth quarter, but the company lowered its forecast for the year. For the year, Dover now projects earnings of $4.70 to $4.95 per share, on revenue growth of 1% to -2%....
TheStreet.com  Jan 27  Comment 
NEW YORK (TheStreet) --Constant Contact Inc. was upgraded to "outperform" from "neutral" at Credit Suisse on Tuesday morning. The firm said it raised its rating on the provider of on-demand engagement marketing tools based on its belief...
Forbes  Jan 27  Comment 
We expect overall revenue growth to remain low, due to the continued impact of the decline in legacy drug sales. As always, the three main oncology drugs will continue to support the topline, although there could be an uptick in Tamiflu’s sales....
Motley Fool  Jan 26  Comment 
Virgin America Inc stock dropped more than 10% on Friday, but long-term investors shouldn't panic.
Wall Street Journal  Jan 26  Comment 
Seagate Technology PLC said its earnings surged thanks to the data-storage company’s revenue growth in the most recent quarter and a gain related to an arbitration award in a dispute with Western Digital Corp.
BBC News  Jan 23  Comment 
Designer shoe maker Jimmy Choo reports yearly net revenue growth of 12%, with Asia its strongest region.
The Economic Times  Jan 23  Comment 
He also said that the government's tax revenue collections have been good, although refunds for past periods are making an impact.
Benzinga  Jan 22  Comment 
8x8, Inc. (NASDAQ: EGHT) is expected to post revenue growth of 26 percent when it issues third-quarter results after the bell Thursday. The company changed hands recently at $8.83, up 1.7 percent, while in the past three months, the company...




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Revenue Growth is the percent increase (or decrease) in a company's revenue between two or more equivalent fiscal periods

Revenue Growth is used to measure how fast a company's business is expanding. The figure shows the annual rate of increase/decrease in a company's revenue or sales growth. The figures give analysts, investors and participants an idea of how much a company's sales are increasing over time.

While revenue growth tends to fluctuate from fiscal year to fiscal year and fiscal quarter to fiscal quarter, investors look for trends in revenue growth as a means of gauging the company's growth over proscribed periods of time. All other things being equal, a company that is able to continually grow its revenue should see equivalent increases in net income.

Rate of Revenue Growth

Taking the derivative of the revenue growth gives you the rate of revenue growth, which tells you how much the rate of revenue growth is changing. Investors look at this figure to gauge a potential forthcoming change in earnings growth. If a company that has been able to consistently grow its revenues at some pace begins to see smaller revenue growth over one or more fiscal periods, it may be an indicator that the growth itself will continue to decrease over time, or that it has plateaued.

Example

Company ABC generated $100 billion in revenue during its third quarter of 2005 and $120 billion in the fourth quarter that year, the company saw quarterly revenue growth of 20% sequentially.

If Company ABC generated $150 billion in the fourth quarter of 2004, the company would have seen its revenue increase 50% on a year-over-year basis

Revenue Growth Calculation on Wikinvest

Wikinvest calculates revenue growth as the growth of trailing twelve months of revenue. The treatment is different from Yahoo! Finance which calculates quarterly year-over-year growth. The following example will illustrate the difference:

' 2006 2007 2008
Q1$100m$104m$144m
Q2$120m$142m$120m
Q3$130m$140m
Q4$140m$170m

Q2 2008 is the most recent quarter. In this case, Yahoo! Finance would calculate revenue growth as -15.5% [(120-142)/142].

Wikinvest, on the other hand would calculate the growth as 11.2%. This is because wikinvest calculates the growth based on the revenue generated in the last twelve months. In this case, Q3 07, Q4 07, Q1 08 and Q2 08. Specially, it is calculated as:

Revenue growth = ((120+144+170+140)-(142+104+140+130))/(142+104+140+130) = 11.2%

Taking the growth based on trailing twelve months of revenue mitigates undue fluctuations that may affect a single quarter.

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