Business, Legal & Accounting Glossary
Year Over Year (YOY) refers to the mathematical process of comparing one year of data to the previous year of data.
In financial analysis and data analytics, YOY is the acronym for year over year.
A year–over–year calculation compares a statistic for one period to the same period the previous year. The period is typically based on a monthly or quarterly basis.
Year-over-year (YOY) is a term used frequently in investment research and other reports to mean “compared with the same period in the previous fiscal year.” Here’s an example: In a second-quarter earnings report for a company with a fiscal year-end of June 30, “Net income rose 12.2% year-over-year” means net income for the quarter ended December 31, 2X02, increased 12.2% from the net income reported in the quarter ended December 31, 2X01. Year-over-year is distinguished from quarter-over-quarter (or “sequential”) comparisons, where results are compared to those in the immediately preceding quarter. Most comparisons in investment reports are year-over-year because most businesses have at least some seasonal variation. For a department store chain where 80% of revenue is recorded in the Christmas quarter, only year-over-year comparisons make sense. But sequential comparisons may usefully accompany year-over-year comparisons — especially in the case of fast-expanding businesses where year-over-year comparisons don’t reflect the rapid rate of expansion. “Year-over-year” is usually unnecessary in full-year comparisons such as “Net income rose 12.2% in 2X02,” where a year-over-year comparison with results in full-year 2X01 can be assumed
Year-Over-Year is a frequently used financial term and put simply it is where you compare the results from one year to another to identify annual trends, shifts in the market, or changes in performance amongst other things. A year-over-year (YOY) analysis is where you compare the results from one year with the results for the same period the year before. When completing a year-over-year analysis people will often look at the same month in each year, or the same quarter of each year.
The year-over-year growth rate determines the percentage change that has occurred throughout the last 12 months.
Looking at year-over-year performance allows you to see if a company’s financial performance is improving, staying stable, or worsening. For example, in financial reports, you may read that a specific company’s revenues increased on a year-over-year basis for the third quarter for the last three years.
A year-over-year comparison is an effective and popular way to evaluate both the performance of investments and the performance of a company. Any event that is both measurable and repeats annually can be evaluated using a year-on-year analysis. Often companies will use a year-on-year analysis to measure compare monthly, quarterly or annual performance.
Year-over-year (or year-on-year) comparisons are a popular and effective way to assess a company’s and investments’ financial performance. Any measurable event that occurs annually can be compared year over year. Annual, quarterly, and monthly performance are all common year-over-year comparisons.
Something to remember: it is not considered a good idea to just rely on the year-over-year analysis of a companies financial position. It is useful to look at the monthly’s as well and be certain to use other metrics to give you a complete picture.
The £14.7 million figure expressed above represents 34.7% growth year-over-year.
This website had 75,000 page views on the third Friday of March, which was a 20% increase YOY.
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This glossary post was last updated: 5th January, 2022 | 0 Views.