If you check your 401(k) or trade on earnings season headlines, you know how much the three-month drumbeat of corporate results can move markets. That cadence is now back in the spotlight after President Trump called for the United States to move away from mandatory quarterly earnings reporting by public companies. He argues that less frequent reports would ease short-term pressure, trim compliance costs, and push executives to invest for the long run. Supporters see a chance to refocus on strategy rather than the next 90 days. Critics warn that cutting back on updates could weaken transparency that many investors rely on and could raise the cost of capital.
What Quarterly Reporting Looks Like Today
U.S. public companies must file a 10-Q each quarter and a 10-K annually with the Securities and Exchange Commission, while earnings calls and forward-looking guidance are industry conventions rather than legal requirements. This framework grew out of mid-20th-century reforms that prioritized timely, comparable information for investors across the market. Regulation FD also exists to reduce selective disclosure, encouraging companies to share material information broadly and at the same time. While many firms issue detailed earnings releases, the 10-Q remains the standardized, regulated touchpoint that anchors models and valuations. Changing the cadence would ripple through how investors analyze performance, how analysts maintain coverage, and how executives communicate setbacks and progress.
Why Trump Says Fewer Filings Could Help
The central claim is about time horizons. Quarterly cycles can push leaders to “make the quarter,” a mindset that can lead to cutting research and development, delaying hiring or maintenance, or reordering capital spending to defend near-term earnings per share. Trump also frames the idea as compliance relief, particularly for smaller companies that devote significant time and professional fees to four reporting cycles. Another strand is competitiveness, since some jurisdictions rely on semiannual reporting and still sustain active markets. The pitch is straightforward, fewer filings mean less noise, lower cost, and more room to invest for durable growth.
Advocates say fewer artificial deadlines could curb earnings management and end-of-quarter window dressing that distort true performance. With a longer runway, boards and executives could prioritize multi-year capital allocation, workforce training, and sustainability initiatives that rarely fit neatly into a three-month box. Cutting the number of cycles from four to two would also reduce recurring workloads across management, legal, finance, auditing, and investor relations, which may matter most for emerging growth and smaller reporting companies. Supporters also argue that shifting away from the beat or miss ritual could improve the quality of disclosure by emphasizing clarity over cadence. International examples, including parts of Europe and the United Kingdom, show that markets can function with half-year reports supported by trading updates.
The Case Against Pulling Back
Opponents emphasize that less frequent mandatory disclosure can make markets less transparent. With fewer standardized updates, information gaps could widen, bid-ask spreads may increase, and smaller investors could be disadvantaged relative to sophisticated players who can source alternative data. There is also the risk of more selective disclosure, since companies under lighter mandates may communicate in ad hoc ways that complicate equal access and comparability. Many advanced markets, including the United States and Japan, have built trust on frequent, uniform reporting, which investors factor into valuations and risk models. Researchers also note that quarterly discipline can deter managerial slack and bring problems to light earlier, so the root causes of short-termism may lie more in guidance and incentives than in the 10-Q itself.
Middle Paths the SEC Could Consider
One option is to keep quarterly reporting but streamline it, focusing 10-Qs on key performance indicators, material changes, and narrative risk updates while cutting duplicative items already found in earnings releases. Another is to target guidance, not reporting, by encouraging companies to drop quarterly earnings per share guidance in favor of annual or multi-year targets and qualitative milestones. Tailored relief could permit semiannual reporting for microcaps or emerging growth companies under defined thresholds, paired with simple trading updates to maintain baseline transparency. Policymakers could also modernize the framework by promoting standardized KPI dashboards and technology-based channels with clear Regulation FD safeguards. These approaches aim to reduce noise and cost without eliminating frequent, comparable data.
Many CEOs have long criticized short-term pressure, though a sizable group prefers ending quarterly guidance rather than ending quarterly reports. Large asset managers are split, since some prize the data frequency that drives models and stewardship, while others want companies to emphasize long-term value creation. Equity analysts rely on the quarterly cadence to maintain coverage and comparability across sectors, and they worry about thinner disclosure. Retail investor advocates and governance groups stress equal access and caution that any move that elevates optional updates over standardized filings could widen information gaps. Regulators and policymakers balance growth and innovation with the SEC’s investor protection mandate and a data-driven rulemaking process.
What Could Change if Rules Shift
Earnings season would arrive less often, and volatility could condense into fewer, bigger information events rather than a steady quarterly rhythm. Sell-side coverage might consolidate, while alternative data, from credit card panels to web traffic, could play a larger role in filling the gaps. Inside companies, incentives could tilt further toward research and development, capital expenditures, and strategies with longer payoffs, including changes in executive compensation design. Public listing decisions could see a modest bump if perceived compliance burdens fall, although the deep private markets remain a powerful counterweight. Corporate communications may lean more on annual letters, investor days, and strategy updates to maintain engagement between formal reports.
Any shift away from quarterly reporting would require SEC rulemaking, including a proposal, public comment, economic analysis, and a final rule. Congress could try to direct or limit reforms, but the agency’s independence and statutory mandates set boundaries. Implementation could include phased timelines, optional pilots, or sunset clauses to test market effects and minimize disruption. Clear guidance on Regulation FD would be essential to prevent selective disclosure during longer intervals between filings. Expect litigation risk and a significant transition period if the SEC moves forward.
Investors will look for signals on whether the SEC opens a formal rulemaking and how it frames costs and benefits for different types of issuers. Watch whether companies continue to pare back quarterly guidance on their own, which could address short-termism without changing the 10-Q. Keep an eye on liquidity, spreads, and research coverage in any pilot or phased rollout, since those metrics reveal how the market processes less frequent data. The core question remains the same, can the United States reduce short-term pressure without sacrificing the transparency that underpins trust in its markets?
