A major shift in US markets is being debated, and investors, analysts, and traders are split on whether scrapping quarterly earnings is a smart move or a risky one.
The Securities and Exchange Commission is considering allowing companies to report results twice a year instead of quarterly, a proposal backed by Donald Trump. But among market professionals, there is no clear consensus.
The Case for Change: Less Pressure, More Long-Term Focus
Some experts say quarterly reporting creates short-term thinking and unnecessary pressure.
Greg Halter of Carnegie Investment Counsel said reducing reporting could:
- Lower corporate costs
- Let management focus on real business performance
- Reduce the “game” of beating quarterly expectations
Similarly, Bret Kenwell from eToro noted that fewer reports could help companies execute long-term strategies more effectively, especially strong, established firms.
The Risks: Less Transparency, More Uncertainty
Others warn the move could reduce visibility for investors.
Melissa Otto of S&P Global said less frequent reporting would mean:
- Less transparency on company performance
- Harder access to timely data
- Greater uncertainty between updates
Investor concerns are clear: fewer reports could make it easier for problems to go unnoticed for longer periods.
Concerns About Bad Actors
Some market veterans are more cautious. Danny Moses of Moses Ventures warned that reduced reporting, combined with lighter regulation, could create risks.
“I am always for more transparency than less,” he said, noting that fewer disclosures could give bad actors more room to operate at the expense of shareholders.
Could Markets Adapt Anyway?
Not everyone believes the change would have a major impact. Louis Navellier of Navellier & Associates expects most US companies would continue reporting quarterly anyway, even if rules change.
This already happens in Europe, where many firms still report quarterly despite looser requirements.
The debate highlights a key trade-off:
- Efficiency and long-term focus for companies
vs - Transparency and real-time insight for investors
If the rule moves forward, it could reshape how information flows in markets, but one thing is clear: Even if quarterly reporting is no longer required, investors may still demand it.
Disclosure: This article does not represent investment advice. The content and materials featured on this page are for educational purposes only.
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