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YoY Revenue Growth Formula:
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Year-over-year (YoY) revenue growth is a key financial metric that compares a company's revenue from one period to the same period in the previous year. It provides insights into business performance and growth trends over time, helping to eliminate seasonal fluctuations.
The calculator uses the YoY growth formula:
Where:
Explanation: The formula calculates the percentage change in revenue between two comparable periods, typically comparing the same quarter or year to the previous year's equivalent period.
Details: YoY revenue growth is crucial for investors, analysts, and business owners to assess company performance, identify growth trends, make strategic decisions, and compare performance against competitors and industry benchmarks.
Tips: Enter current period revenue and previous period revenue in your local currency. Both values must be positive numbers. The calculator will automatically compute the YoY growth percentage.
Q1: What is considered good YoY revenue growth?
A: Good growth varies by industry, but generally 10-20% annually is considered healthy for established companies, while startups may aim for higher percentages.
Q2: How is YoY different from quarter-over-quarter (QoQ)?
A: YoY compares the same period year-to-year, eliminating seasonal effects, while QoQ compares consecutive quarters and may be affected by seasonality.
Q3: Can YoY growth be negative?
A: Yes, negative YoY growth indicates declining revenue compared to the previous year, which may signal business challenges or market changes.
Q4: What factors can affect YoY revenue growth?
A: Market conditions, competition, pricing strategies, product launches, economic factors, and seasonal trends can all impact YoY growth.
Q5: How often should YoY growth be calculated?
A: Typically calculated quarterly and annually, but can be measured monthly for more frequent performance tracking in fast-moving industries.