Trump calls for the end of quarterly earnings. The SEC is looking into it

[Business image chart]
Ca-ssis/iStock via Getty Images

How often should a company update investors about its financials? That debate has been shoved back into the public sphere after President Trump called for earnings to be reported on a semiannual basis [https://seekingalpha.com/news/4494840-trump-pushes-to-do-away-with-quarterly-earnings-reports], as opposed to the current framework of quarterly results. "This will save money and allow managers to focus on properly running their companies," he wrote in a post on Truth Social.

_Some history:_ The SEC has required publicly traded companies in the U.S. to publish their earnings on a quarterly basis since 1970. That was changed from semiannual reporting standards that had been instituted in 1955. Legal and reporting requirements before then were less standardized, though all corporations have had to file annual 10-K filings, including audited financial statements, since the Securities Exchange Act of 1934.

Many countries that have developed markets only require reporting on a semiannual basis, including the U.K. and members of the European Union. During his first term, Trump also brought up the idea of switching back to a semiannual reporting structure to discourage short-termism and slash costs for companies. While the SEC sought public comment on the matter in 2018, the regulator didn't end up implementing any changes. This time around, however, SEC Chairman Paul Atkins is "prioritizing this proposal to further eliminate unnecessary regulatory burdens on companies," according to a spokesperson for the agency.

THE DEBATE: Changing to a less frequent reporting structure has divided many in the financial world, as well as shareholders versus the C-suite. Some say that current standards sacrifice long-term strategy for the sake of near-term profits. Others maintain that the system that has been in place for decades gives necessary transparency and keeps investors up to date, especially in our real-time trading environment. There are also those that have called for the current system to remain in place, but to do away with voluntary quarterly guidance that has become a mainstream practice since the 1990s and early 2000s.

_SEEKING ALPHA SURVEY:_ How often should publicly traded companies in the U.S. disclose their financial results? Take the poll here [https://forms.gle/7XPxq9zu8bjAcoQU9] and share how it might continue to impact markets in the comments section.

MORE ON MARKETS

* New Highs, Low Drama [https://seekingalpha.com/article/4823144-new-highs-low-drama]
* Record Highs For The Dow Remind Me Of The 2022 Market Correction [https://seekingalpha.com/article/4823103-record-highs-for-the-dow-remind-me-of-the-2022-market-correction]
* Since 1980, This Is How Rate Cuts Impact The S&P 500 Near All-Time Highs [https://seekingalpha.com/article/4823076-since-1980-this-is-how-rate-cuts-impact-the-s-and-p-500-near-all-time-highs]
* Trump's pick Stephen Miran confirmed as Fed governor [https://seekingalpha.com/news/4495107-trump-nominee-stephen-miran-fed-governor-senate-vote]
* Appeals court deals Trump second loss in attempt to oust Fed Governor Lisa Cook [https://seekingalpha.com/news/4495079-appeals-court-deals-trump-second-loss-attempt-oust-fed-governor-lisa-cook]