In the world of finance, some ideas are so foundational they feel like laws of nature. The quarterly earnings report is one of them. Every 90 days, public companies face a public report card, a ritual that sends shockwaves through stock prices and dominates financial news. So, when a figure like Donald Trump suggests scrapping it, the immediate reaction is a gasp for the small investor, presumed to be left in the dark.
But this reaction misses the bigger picture. While reducing mandatory disclosures from four to two times a year seems like a step back for transparency, the average long-term investor is not the one who stands to lose the most. In fact, the real casualty if Trump and the SEC end quarterly reporting would be the massive, content-hungry machine that profits from short-term market volatility: the financial media and analyst industrial complex.
The Tyranny of the 90-Day Cycle
For decades, we’ve been conditioned to see the market through a quarterly lens. This relentless cycle fosters a ‘beat or miss’ culture that forces CEOs to manage for the next 90 days rather than the next five years. To hit a Wall Street estimate, a company might:
- Delay crucial R&D spending
- Cut back on vital marketing campaigns
- Push sales aggressively at a quarter’s end
These actions satisfy the immediate hunger for good numbers but can starve a company of long-term growth. Legendary investor Warren Buffett has long criticized this “tyranny of the quarter,” arguing it promotes a short-sightedness that is detrimental to genuine value creation.
Who Really Loses if Quarterly Reporting Ends?
If the patient investor isn’t the primary victim, then who is? Consider the vast ecosystem built around the quarterly earnings season.
Financial news outlets see massive spikes in traffic and viewership. Analysts build their reputations on the accuracy of their quarterly estimates. An earnings “miss” provides days of dramatic headlines, while a “beat” fuels bullish commentary. This cycle is a reliable content engine, a manufactured drama that keeps viewers glued and clicks coming.
Without the steady, quarterly drip of data, this engine would sputter. The frantic, moment-to-moment analysis would have to be replaced by deeper, more thoughtful—and perhaps less sensational—coverage of business strategy and industry trends. The same applies to high-frequency traders who thrive on the volatility created by earnings announcements. Fewer reporting periods mean fewer predictable opportunities to profit from these short-term price swings.
A Welcome Shift for the Long-Term Investor
For a true investor—someone putting capital to work in a business they believe in for the long haul—this quarterly circus is often more noise than signal. Does a single, slightly disappointing quarter invalidate a company’s entire strategic vision? Rarely. Yet, the market reacts with brutal immediacy.
Ending the quarterly mandate could force a much-needed cultural shift. It would compel both management and investors to focus on fundamental business health, strategic execution, and annual performance—the metrics that truly build wealth over time. In many global markets where regulators mandate robust quarterly reporting, this debate should prompt a vital question: does an obsession with short-term numbers serve the goal of long-term capital formation?
What a New Reporting Rhythm Could Mean
A move to semi-annual reporting wouldn’t plunge investors into an information abyss. Companies would still be required to disclose material events as they happen, and the comprehensive annual report would become an even more crucial document.
The real change would be in the rhythm of the market—a shift from a frantic sprint every three months to a more measured, long-distance run. The debate sparked by the proposal to end quarterly reporting forces us to ask who the current system truly serves. The answer may not be the patient investor it purports to protect, but rather the hyperactive ecosystem that profits from the noise it generates.
