Form 10-Q

What it is

This is the quarterly earnings report filed by all public companies to better inform investors of business operations. The 10-Q is filed every three months and provides same quarter year over year and subsequent quarter comparison of the financials. The statements are generally unaudited due to time constraints. Often the fourth 10-Q may be combined with the 10-K annual report resulting in three 10-Q filings and a 10-K filing for the fiscal year. Companies issue a press release detailing the summary of the earnings report and then follow up a conference call to review the quarterly performance.

How to Read a form 10-Q

The 10-Q is less detailed than a 10-K report. However, the same things to look for still apply. The most significant is the improvement or digression in the financial performance compared to same quarter year over year. The forward guidance can have the most significant impact on share prices.

Things to Look Out For

The most material impact from an earnings report is the forward revenues and earnings guidance, which can initially be found on the press release. The follow-up conference call allows for investors and analysts to ask questions and provide feedback with company executives. Additional key information regarding material changes in the company operations, structure, and litigation or revenue recognition are also key things to look for.