Summary
Revenue Growth measures the percentage increase or decrease in a company’s revenue compared with a previous period. It shows whether the company is generating more or less sales over time.
Revenue is often viewed as the starting point for business growth.
Why it matters
Revenue growth may indicate increasing demand, successful expansion, improved pricing, or stronger market position. It helps investors understand whether the company’s business activity is growing.
However, revenue growth does not automatically mean profit growth.
How it is calculated
Revenue Growth = Current Revenue − Previous Revenue ÷ Previous Revenue × 100
How to read it
Positive Revenue Growth means sales increased compared with the previous period. Negative Revenue Growth means sales declined.
Investors should review whether revenue growth is also leading to improved margins, earnings, and cash flow.
When it may not be available
Revenue Growth may not be shown when the previous period’s revenue is unavailable or when the previous value is zero.