Revenue Growth

RECENT NEWS
Wall Street Journal  6 hrs ago  Comment 
By raising its dividend and giving more buoyant guidance on revenue growth, Intel has given investors reason to stick around after the stock’s recent run.
Agoracom  6 hrs ago  Comment 
XYL: TSX-V Welcome to Beyond The Press Release a production of AGORACOM in which we speak with small cap executives about their recent press releases. With us today is Matt Willer , VP of Sales and Marketing of Xylitol Canada . Xylitol...
WA Business News  Nov 21  Comment 
A week after being named the country’s top cooperative business, CBH Group has revealed an anticipated revenue growth of nearly 40 per cent.
WA Business News  Nov 21  Comment 
A week after being named the country’s top cooperative business, CBH Group has revealed an anticipated revenue growth of nearly 40 per cent.
The Economic Times  Nov 21  Comment 
Again huge amount of traction happening, there might be some amount of revenue growth but again we will be a little bit cautious for these stocks going forward.
Benzinga  Nov 20  Comment 
Splunk Inc (NASDAQ: SPLK) beat third-quarter expectations Thursday, posting revenue growth of 48 percent and offering an outlook above Wall Street views. The company saw its shares gain 5.5 percent in the extended session recently, to $68.50...
Wall Street Journal  Nov 20  Comment 
Analytics company Splunk recorded higher operating expenses in the third quarter as it released new versions of its core products, offsetting broad revenue growth.
newratings.com  Nov 20  Comment 
SANTA CLARA (dpa-AFX) - Intel Corp (INTC) Thursday provided its revenue guidance for the full year 2015, and announced a 6.7 percent increase in its cash dividend. Intel shares are gaining 2.3 percent in afternoon trade on the Nasdaq. For 2015,...
Automotive World  Nov 20  Comment 
Revenue increases to more than EUR 9.0 bn; growth of 9 % at constant currency for the first nine months Earnings quality improved significantly; EBIT margin of 13.5 % Capital expenditures significantly above prior year Free cash flow positive...




RELATED WIKI ARTICLES
 

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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