Editor’s Note: This article has been updated with more details.
Donald Trump is pushing the Securities and Exchange Commission (SEC) to eliminate quarterly corporate earnings reports, proposing instead a six-month reporting cycle.
What Happened: Trump took to his Truth Social on Monday to argue that the current quarterly reporting system is detrimental to U.S. companies. He said the shift would save costs and free executives to focus on long-term growth, Trump contrasted U.S. short-term practices with China's "50 to 100 year" business outlook, calling the current system "not good."
“This will save money, and allow managers to focus on properly running their companies,” wrote Trump.
Why It Matters: It would represent a major shift in how American companies operate, bringing their reporting practices more in line with those of public companies in Europe. Notably, listed companies in some of the Asian countries also report their results on a six-monthly or semi-annual basis.
During his first term, in August 2018, President Trump argued that shifting from quarterly to semiannual reporting would reduce costs for companies and provide greater flexibility. He urged federal regulators to consider a major overhaul in how businesses report earnings to investors.
Before that, in June 2018, Warren Buffett and JPMorgan Chase CEO Jamie Dimon supported eliminating quarterly guidance in a Wall Street Journal op-ed, though not the earnings reports themselves.
After Trump’s post during his first term, Buffett later told CNBC, "I like to get those quarterly reports. I do not like guidance. I think the guidance leads to a lot of bad things, and I've seen it lead to a lot of bad things."
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
