Monthonmonth

Month-on-month (MoM) is a metric that expresses the percentage change in a variable from one calendar month to the next. It is widely used in finance, economics, and business analytics to gauge short-term momentum and monitor monthly performance. MoM growth is calculated as ((Value in the current month − Value in the previous month) / Value in the previous month) × 100. When the previous month value is zero, MoM is undefined.

MoM is useful for tracking monthly trends in revenue, sales, user activity, production, or cash flow. However, it can be volatile, reflecting seasonality, holidays, promotions, and other short-term factors. To mitigate noise, analysts may use seasonally adjusted figures or complement MoM with year-over-year (YoY) comparisons, moving averages, or quarterly metrics.

Interpreting MoM requires context: a positive MoM indicates growth versus the prior month, while a negative MoM indicates a decline. Small base effects can exaggerate changes when the previous month is small. Limitations include calendar effects (shorter or longer months), one-off events, and structural changes in the data.

Variants include annualized MoM, which projects the monthly rate across a year as (1 + MoM)^12 − 1. Data quality and consistency are important for meaningful comparisons, and MoM is typically most informative when used alongside other metrics.