Sequential Growth

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.


Filed Under:

comments powered by Disqus
Hot Definitions
  1. Organic Growth

    The growth rate that a company can achieve by increasing output and enhancing sales. This excludes any profits or growth acquired from takeovers, acquisitions or mergers. Takeovers, acquisitions and mergers do not bring about profits generated within the company, and are therefore not considered organic.
  2. Family Limited Partnership - FLP

    A type of partnership designed to centralize family business or investment accounts. FLPs pool together a family's assets into one single family-owned business partnership that family members own shares of. FLPs are frequently used as an estate tax minimization strategy, as shares in the FLP can be transferred between generations, at lower taxation rates than would be applied to the partnership's holdings.
  3. Yield Burning

    The illegal practice of underwriters marking up the prices on bonds for the purpose of reducing the yield on the bond. This practice, referred to as "burning the yield," is done after the bond is placed in escrow for an investor who is awaiting repayment.
  4. Marginal Analysis

    An examination of the additional benefits of an activity compared to the additional costs of that activity. Companies use marginal analysis as a decision-making tool to help them maximize their profits. Individuals unconsciously use marginal analysis to make a host of everyday decisions. Marginal analysis is also widely used in microeconomics when analyzing how a complex system is affected by marginal manipulation of its comprising variables.
  5. Treasury Inflation Protected Securities - TIPS

    A treasury security that is indexed to inflation in order to protect investors from the negative effects of inflation. TIPS are considered an extremely low-risk investment since they are backed by the U.S. government and since their par value rises with inflation, as measured by the Consumer Price Index, while their interest rate remains fixed.
  6. Gilt-Edged Switching

    The selling and repurchasing of certain high-grade stocks or bonds to capture profits. Gilt-edged switching involves gilt-edged security, which can be high-grade stock or bond issued by a financially stable company such as the Blue Chip companies or by certain governments.
Trading Center