Sequential Growth

AAA

DEFINITION of 'Sequential Growth'

A measure of a company's short-term financial performance that compares the results achieved in a recent period to those of the period immediately preceding it. In financial reporting, sequential growth often compares the results between two quarters. A company might be reported to have experienced 3% sequential sales growth - this means that its revenue has increased by 3% since the previous quarter.

INVESTOPEDIA EXPLAINS 'Sequential Growth'

When considering how much weight to place on reports of sequential growth (or the lack thereof), it is important to keep in mind that seasonal fluctuations often affect a company's short-term performance.





A major retailer might report 10% sequential growth in the fourth quarter, then see a relative decline in revenue in the first quarter of the following year. This would not necessarily indicate that the business is performing poorly - it could simply be the result of increased consumer spending during the holiday spending followed by a return to normal spending in the new year. It is important to look at a variety of indicators to get an accurate picture of a company's performance.

RELATED TERMS
  1. Operating Revenue

    Income derived from sources related to a company's everyday business ...
  2. Revenue

    The amount of money that a company actually receives during a ...
  3. Net Income - NI

    1. A company's total earnings (or profit). Net income is calculated ...
  4. Operating Cash Flow - OCF

    In accounting, a measure of the amount of cash generated by a ...
  5. Operating Earnings

    Profit earned after subtracting from revenues those expenses ...
  6. Operating Expense

    A category of expenditure that a business incurs as a result ...
RELATED FAQS
  1. What level of annual growth is common for companies in the Internet sector?

    The Internet services sector consists of a diverse group of companies that exhibit strong growth potential. Investors often ... Read Full Answer >>
  2. Why would you look at year-over-year rather than quarterly growth?

    Growth rates are an important metric for evaluating financial and economic data. Annual growth rates are more commonly cited ... Read Full Answer >>
  3. How attractive is the food and beverage sector for a growth investor?

    The food and beverage sector is attractive for a growth investor. The sector's high degree of volatility means it tends to ... Read Full Answer >>
  4. What techniques are most useful for hedging exposure to the insurance sector?

    Investing style determines the best hedging techniques for the insurance sector. This sector comprises three segments, two ... Read Full Answer >>
  5. How attractive is the retail sector for a growth investor?

    Retail is an attractive sector for a growth investor due to its propensity for turning in bigger-than-average gains when ... Read Full Answer >>
  6. What average annual growth rate is typical for the banking sector?

    The banking sector plays an important intermediary role by channeling available funds for productive uses in the economy ... Read Full Answer >>
Related Articles
  1. Investing Basics

    Analyze Investments Quickly With Ratios

    Make informed decisions about your investments with these easy equations.
  2. Markets

    Is Growth Always A Good Thing?

    Getting big quickly looks good, but companies can get into trouble when they do it too fast. Find out how to spot this trouble.
  3. Investing

    Earnings: Quality Means Everything

    It's quantity that generates all the hype, but there are more meaningful factors that gauge true performance.
  4. Investing Basics

    Understanding The Cash Conversion Cycle

    Find out how a simple calculation can help you uncover the most efficient companies.
  5. Forex Education

    Understanding The Income Statement

    Learn how to use revenue and expenses, among other factors, to break down and analyze a company.
  6. Retirement

    The Essentials Of Corporate Cash Flow

    Tune out the accounting noise and see whether a company is generating the stuff it needs to sustain itself.
  7. Investing

    Finding Profit In Troubled Stocks

    Find out the difference between a company capable of surviving a share-price beating and one that cannot.
  8. Mutual Funds & ETFs

    ETF Analysis: iShares MSCI EAFE Index

    Discover how the iShares MSCI EAFE Index ETF is managed, and learn which investors may benefit from adding the fund to a portfolio.
  9. Mutual Funds & ETFs

    ETF Analysis: Vanguard International Stock

    Discover how the Vanguard Total International Stock ETF is managed, and learn which investors may find it suitable as part of a diversified portfolio.
  10. Mutual Funds & ETFs

    ETF Analysis: SPDR S&P Biotech

    Discover the investment management style of SPDR S&P Biotech ETF, and learn which investors can benefit from the fund's focused biotech holdings.

You May Also Like

Hot Definitions
  1. Dog And Pony Show

    A colloquial term that generally refers to a presentation or seminar to market new products or services to potential buyers.
  2. Topless Meeting

    A meeting in which participants are not allowed to use laptops. A topless meeting organizer can also ban the use of smartphones, ...
  3. Hedging Transaction

    A type of transaction that limits investment risk with the use of derivatives, such as options and futures contracts. Hedging ...
  4. Bogey

    A buzzword that refers to a benchmark used to evaluate a fund's performance. The benchmark is an index that reflects the ...
  5. Xetra

    An all-electronic trading system based in Frankfurt, Germany. Launched in 1997 and operated by the Deutsche Börse, the Xetra ...
  6. Nuncupative Will

    A verbal will that must have two witnesses and can only deal with the distribution of personal property. A nuncupative will ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!