Quarterly reports filed with the SEC after each of the first three quarters of the year are called 10-Q reports. The annual report filed with the SEC that includes the full year’s financial information is called a 10-K. The two types of reports provide similar information, although a 10-K is typically more detailed and comprehensive.
Alternate names: Quarter on quarter, quarter to quarter, or one-quarter growth rates Acronym: QOQ or Q/Q Alternate definition: Quarter over quarter also can refer to larger-scale economic performance such as the GDP report that is released by the U.S. Bureau of Economic Analysis.
The formula for determining quarter-over-quarter performance is: (current quarter number - previous quarter number) / previous quarter The chart below looks at the real-world example of lodging company Airbnb, comparing the company’s second-quarter revenue for 2021 with the previous quarter as well as the second quarter of 2020.
How Quarter Over Quarter Works
To continue our example, investors who are considering purchasing shares of Airbnb stock can review the company’s revenue growth from one quarter to the next as well as year over year to help determine whether business is rebounding sufficiently from the drop-off that occurred during 2020. Other data besides earnings figures from the company’s 10-Q and 10-K reports is also important when analyzing Airbnb, including marketing costs, total nights booked and gross booking value (a number that tracks host earnings, service fees, cleaning fees, and taxes). These totals also can be compared quarter over quarter or year over year.
What It Means for Investors
There are different ways to determine whether a stock is a wise and timely investment. Some investors like to ride a company stock as its quarterly performance crests, while others may aim to jump in when a stock price is dropping in a quarter-on-quarter comparison but has the potential to rebound.
