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In his latest bid to reshape the American economy, President Donald Trump has endorsed ending the decades-long practice of public companies sharing their financial results once each quarter.
Such a move would represent a dramatic shift aimed at combating short-term thinking inside C-Suites obsessed with pleasing investors but would also mean far less timely insights into the business world and the real economy.
In a Truth Social post this morning, Trump said companies “should no longer be forced to ‘Report’ on a quarterly basis” and should instead report results once every six months.
“This will save money, and allow managers to focus on properly running their companies,” Trump said. “Did you ever hear the statement that, ‘China has a 50 to 100 year view on management of a company, whereas we run our companies on a quarterly basis???’ Not good!!!!”
In his latest bid to reshape the American economy, President Donald Trump has endorsed ending the decades-long practice of public companies sharing their financial results once each quarter.
Such a move would represent a dramatic shift aimed at combating short-term thinking inside C-Suites obsessed with pleasing investors but would also mean far less timely insights into the business world and the real economy.
In a Truth Social post this morning, Trump said companies “should no longer be forced to ‘Report’ on a quarterly basis” and should instead report results once every six months.
“This will save money, and allow managers to focus on properly running their companies,” Trump said. “Did you ever hear the statement that, ‘China has a 50 to 100 year view on management of a company, whereas we run our companies on a quarterly basis???’ Not good!!!!”
I’m very doubtful that moving to six-month or annual financial reporting would make a public company’s CEO and board take the company’s long term strategy and performance any more seriously. In fact, I think it could give some executives more time to cook the books.
On the other hand, does quarterly financial reporting really hurt a company’s long term strategy?
Take TSMC, UMC, MediaTek, Foxconn, ASE, and Quanta Computer as examples. Not only they file quarterly reports, but under Taiwan’s securities law they also report the previous month’s revenue by the 10th of each month. Their business have been doing great for many years. Based on that, can we say that more transparency helps both companies and investors?
He is not wrong. I wonder if this was one of the things his CEO dinners came up with? Sounds like it.
Quarterly reporting is a burden and yes it does change the focus of the C Level. I have been through this and not only is it expensive/time consuming, it does put pressure on short term goals. My experience is with companies under $100M in revenue. It was a killer. We would discuss what is best for the stock price and since we all had stock is was not hard to focus on it.
On the down side it does leave more room for corporate monkey business. I am pro business so I say Just Do It.
He is not wrong. I wonder if this was one of the things his CEO dinners came up with? Sounds like it.
Quarterly reporting is a burden and yes it does change the focus of the C Level. I have been through this and not only is it expensive/time consuming, it does put pressure on short term goals. My experience is with companies under $100M in revenue. It was a killer. We would discuss what is best for the stock price and since we all had stock is was not hard to focus on it.
On the down side it does leave more room for corporate monkey business. I am pro business so I say Just Do It.
So does that mean investors would only discover six months or even a year later that they had been scammed by a company?
That’s unacceptable. If a company thinks financial reporting is too much of a burden, it should stay private or return to being private. Public companies can’t have it both ways, enjoying all the benefits of open stock markets while keeping their financial information hidden for a year.
He is not wrong. I wonder if this was one of the things his CEO dinners came up with? Sounds like it.
Quarterly reporting is a burden and yes it does change the focus of the C Level. I have been through this and not only is it expensive/time consuming, it does put pressure on short term goals. My experience is with companies under $100M in revenue. It was a killer. We would discuss what is best for the stock price and since we all had stock is was not hard to focus on it.
On the down side it does leave more room for corporate monkey business. I am pro business so I say Just Do It.
Major companies are not doing short term management based on this. In semis, things change dramatically quarter by quarter and people would have to wait to get latest update. it would also mean leaks of information would take longer before it becomes official (Like the leaks on Microns upcoming earnings)
I dont think a lot of my investor clients would allow companies to report every 6 months .... unless they were have non-public meetings with the CFO.
I personally liked the taiwan rules on monthly reporting.... but it did cause issues for us when revenue went up or down by 30% in one month.
