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Quarter On Quarter (QOQ)

What is a 'Quarter On Quarter - QOQ'

Quarter on quarter (QOQ) is a measuring technique that calculates the change between one financial quarter and the previous financial quarter. This is similar to the year-over-year (YOY) measure, which compares the quarter of one year (such as the first quarter of 2005) to the same quarter of the previous year (the first quarter of 2004). The measure gives investors and analysts an idea of how a company is growing over each quarter.

Explaining 'Quarter On Quarter - QOQ'

For example, the QOQ measure can be used to compare the earnings between quarters. Let's say that the ABC Company's first-quarter earnings were $1.50 per share and its second quarter earnings were $1.75 per share. This means that the company has grown its earnings by 16.6% QOQ ($1.75-$1.50/$1.50), which is a good sign for investors.

Understanding a Quarter

When used in reference to financial or accounting principles, a quarter (Q) is a consecutive three-month period within the year. Traditionally, the first quarter (Q1) refers to the months of January, February and March. Each subsequent three-month period represents Q2, Q3 and Q4 respectively.

Issues of QOQ Analysis

There are circumstances where QOQ analysis may not provide an entire picture as to the health of an organization. For example, if an industry experiences seasonal sales variances, such as landscapers or holiday décor sellers, what may appear to be a downward trend may actually be an industry norm. The same can apply if a business experiences higher earnings during a peak season that may reflect as abnormally high growth when examined from one quarter to the next. To compensate for normal shifts in business, an organization may choose to adjust the figures seasonally. This can help produce a more accurate picture throughout the year.

Quarter On Quarter (qoq) FAQ

What is quarter over quarter?

Key Takeaways. Quarter over quarter (Q/Q) measures an investment or company's growth from one quarter to another. Q/Q is also measures changes in other important statistics, such as gross domestic product (GDP). Analysts use Q/Q when reviewing a company's performance over several quarterly periods.

What is q1 q2 q3 q4?

The standard calendar quarters are represented as: January, February, and March (Q1) April, May, and June (Q2) July, August, and September (Q3) October, November, and December (Q4)

What is quarter on quarter growth?

Q/Q measures the changes in the rate different financial numbers and metrics found in the financial statements grow from one period to the next. Typically, it compares reports from one quarter of the company's fiscal year with the reports from the previous quarter.

How do you calculate quarterly growth?

Divide the current number (year, quarter, month) with the previous period's number, and then subtract 1 from it. That gives the same result.

How do you annualize a quarterly growth rate?

Add all the quarterly absolute numbers if you are using a number of quarters other than four or one. Divide the total by the number of quarters and multiply the quotient by four to get the annualized numbers. For percentages, add them all together and divide by the number of quarters.

Further Reading


Liquidity risk management and credit supply in the financial crisis
www.sciencedirect.com [PDF]
… Volume 101, Issue 2, August 2011, Pages 297-312. Journal of Financial Economics … We build a quarterly panel data set from the beginning of 2006 through the second quarter of 2009 that includes all commercial banks as described below …

Corporate yield curves as predictors of future economic and financial indicatorsCorporate yield curves as predictors of future economic and financial indicators
www.tandfonline.com [PDF]
… Volume 101, Issue 2, August 2011, Pages 297-312. Journal of Financial Economics … We build a quarterly panel data set from the beginning of 2006 through the second quarter of 2009 that includes all commercial banks as described below …

Predicting US recessions: Financial variables as leading indicatorsPredicting US recessions: Financial variables as leading indicators
www.mitpressjournals.org [PDF]
… Volume 101, Issue 2, August 2011, Pages 297-312. Journal of Financial Economics … We build a quarterly panel data set from the beginning of 2006 through the second quarter of 2009 that includes all commercial banks as described below …

Multimodality in macro-financial dynamicsMultimodality in macro-financial dynamics
papers.ssrn.com [PDF]
… Volume 101, Issue 2, August 2011, Pages 297-312. Journal of Financial Economics … We build a quarterly panel data set from the beginning of 2006 through the second quarter of 2009 that includes all commercial banks as described below …

GARCH 101: The use of ARCH/GARCH models in applied econometricsGARCH 101: The use of ARCH/GARCH models in applied econometrics
www.aeaweb.org [PDF]
… Volume 101, Issue 2, August 2011, Pages 297-312. Journal of Financial Economics … We build a quarterly panel data set from the beginning of 2006 through the second quarter of 2009 that includes all commercial banks as described below …

Do firms mislead investors by overstating earnings before seasoned equity offerings?Do firms mislead investors by overstating earnings before seasoned equity offerings?
www.sciencedirect.com [PDF]
… Volume 101, Issue 2, August 2011, Pages 297-312. Journal of Financial Economics … We build a quarterly panel data set from the beginning of 2006 through the second quarter of 2009 that includes all commercial banks as described below …

What drives bank-intermediated trade finance? Evidence from cross-country analysisWhat drives bank-intermediated trade finance? Evidence from cross-country analysis
papers.ssrn.com [PDF]
… Volume 101, Issue 2, August 2011, Pages 297-312. Journal of Financial Economics … We build a quarterly panel data set from the beginning of 2006 through the second quarter of 2009 that includes all commercial banks as described below …

The time-varying NAIRU and its implications for economic policyThe time-varying NAIRU and its implications for economic policy
www.aeaweb.org [PDF]
… Volume 101, Issue 2, August 2011, Pages 297-312. Journal of Financial Economics … We build a quarterly panel data set from the beginning of 2006 through the second quarter of 2009 that includes all commercial banks as described below …

Disentangling demand and supply in credit developments: a survey-based analysis for ItalyDisentangling demand and supply in credit developments: a survey-based analysis for Italy
www.sciencedirect.com [PDF]
… Volume 101, Issue 2, August 2011, Pages 297-312. Journal of Financial Economics … We build a quarterly panel data set from the beginning of 2006 through the second quarter of 2009 that includes all commercial banks as described below …



FAQ


What is quarter over quarter?

Key Takeaways. Quarter over quarter (Q/Q) measures an investment or company's growth from one quarter to another. Q/Q is also measures changes in other important statistics, such as gross domestic product (GDP). Analysts use Q/Q when reviewing a company's performance over several quarterly periods.

What is q1 q2 q3 q4?

The standard calendar quarters are represented as: January, February, and March (Q1) April, May, and June (Q2) July, August, and September (Q3) October, November, and December (Q4)

What is quarter on quarter growth?

Q/Q measures the changes in the rate different financial numbers and metrics found in the financial statements grow from one period to the next. Typically, it compares reports from one quarter of the company's fiscal year with the reports from the previous quarter.

How do you calculate quarterly growth?

Divide the current number (year, quarter, month) with the previous period's number, and then subtract 1 from it. That gives the same result.

How do you annualize a quarterly growth rate?

Add all the quarterly absolute numbers if you are using a number of quarters other than four or one. Divide the total by the number of quarters and multiply the quotient by four to get the annualized numbers. For percentages, add them all together and divide by the number of quarters.