Revenue Growth

RECENT NEWS
Motley Fool  May 27  Comment 
But I see no need to wave you off from the stock just yet.
Benzinga  May 27  Comment 
Splunk Inc (NASDAQ: SPLK) reported a strong quarter, with revenue, operating margins and FCF ahead of expectations. Canaccord Genuity's Richard Davis reiterated a Buy rating for the company, while raising the price target from $60 to $65. The...
Benzinga  May 27  Comment 
Following the robust billings and revenue growth reported by Palo Alto Networks Inc (NYSE: PANW), Pacific Crest’s Rob Owens stated that the stock was “trading at a reasonable multiple on various cash flow metrics, which presents a buying...
Reuters  May 27  Comment 
French catering company Elior Group reported 3.5 pct revenue growth and 5.8 pct growth in core profit (EBITDA) for the first half of 2015/2016 fiscal year, driven by a faster pace...
GenEng News  May 27  Comment 
The revenue growth opportunity in vaccines looks far more promising when compared to the overall market for pharmaceuticals. Revenues earned by vaccines manufacturers worldwide reached $27.6 billion in 2015 according to Kalorama Information, up...
Benzinga  May 26  Comment 
Shopify Inc (NYSE: SHOP) has several positives that point to a “long-tail growth story,” Canaccord Genuity’s Richard Davis said in a report. The analyst reiterated a Buy rating for the company, with a price target of $38. Despite the...
Agoracom  May 26  Comment 
Highlights 2015 Revenues $USD 7.36M, Up 53% Over Previous Q4 2015 Revenue $USD 2.49M, Up 101% Over Previous Real Customers The Opportunity 44% of security leaders expect a major cloud provider to suffer a significant security...
Clusterstock  May 25  Comment 
It's hard to grow a business out there. One chart from Societe Generale shows the scope of the slowdown in revenue growth. According to Societe Generale's Equity Strategy team, not only are firms facing an earnings recession, but revenues are...
newratings.com  May 25  Comment 
LONDON (dpa-AFX) - Intertek Group plc (ITRK.L) a Total Quality Assurance provider to industries, reported Wednesday that its group revenues for the four months till April 30 were 774 million pounds, a growth of 12.7% on a reported basis and 10.6%...
The Economic Times  May 23  Comment 
The cigarette volumes grew 0-1% in 4QFY16 and volume growth jumped after after 11 quarters, said the Macquarie note. The revenue growth and the margins in the non-cigarette businesses remained weak




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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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