OLD Media Moves

Business press suckered in sequential reporting on earnings

July 26, 2007

Posted by Chris Roush

TheStreet.com media critic Marek Fuchs writes that some companies are asking business reporters to cover their earnings sequentially and not year-over-year, and some are being suckered into the tactic.

Marek FuchsFuchs wrote, “Texas Instruments reported after the close on Monday. And then there’s the press release. The first two bullet points, coming right after the headline, and in bold no less, are about how revenues and earnings were up … sequentially.

  • TI Revenue Up 7% Sequentially
  • EPS Up $0.42, Up 20% Sequentially

    “Sequential. Sequential. Sequential.

    “Texas Instruments is really pressing the sequential point here. In the second sentence of the body of the press release, we hear about those revenues again — up 7% compared to the ‘prior quarter.’

  • “Of course, we are soon reading a mention about how, compared to the same quarter last year (the second), revenues were down. And this, of course, is all The Business Press Maven cares about. Each quarter, you see, has its own characteristics — its own seasonal issues and the like — which is why it is generally accepted practice to make year-over-year comparisons.

    “Sequential comparisons are for those who want to avoid the more telling one.”

    Read more here. Fuchs notes that the Financial Times dutifully reported the earnings sequentially.


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