What is Year-Over-Year (YoY): Examples & Why It Matters

In finance, business, and investing, you are likely to come across the phrase “year-over-year” (abbreviated as YoY) quite often.

First, a quick definition of what year-over-year means.  Year-over-year compares results from one time period to the same time period in the previous year.

This article explores the meaning of year-over-year, gives a real-world example of its use, and discusses why it matters.

What Is Year-Over-Year?

These figures, along with a host of other quarterly numbers, are provided in the income statement, balance sheet, and statement of cash flow.

When a company reports its quarterly financial results, it will typically at least announce its revenue and earnings-per-share for the preceding three-month period.

Annual comparisons are another advantage of utilizing year-over-year results, that quarter-over-quarter analysis does not provide.

Why Is Year-Over-Year Important?

In many ways, a year-over-year comparison is more valuable for investors than a quarter-over-quarter, or “sequential” comparison.