QoQ

QoQ stands for quarter-over-quarter and is a metric used to compare a value for one quarter with the value from the immediately preceding quarter. It is commonly expressed as a percentage growth rate and is widely used in finance, corporate reporting, and macroeconomics.

Calculation and variants: The standard QoQ growth rate is (Current quarter value minus Previous quarter value) divided by the Previous quarter value, times 100%. In macroeconomic reporting, figures are often shown as an annualized QoQ rate, calculated as (1 plus the quarterly growth rate) raised to the power of four, minus one, to reflect four quarters of compounding. Some sources also present a simpler four-quarter extrapolation. Data can be reported in raw (not seasonally adjusted) form or seasonally adjusted to remove regular seasonal effects.

Uses and examples: QoQ is used to assess near-term momentum in metrics such as quarterly revenue, earnings, production, consumer spending, or GDP. For a company, QoQ revenue growth indicates how quickly sales are changing from one quarter to the next. For an economy, QoQ GDP growth (often annualized) shows short-run expansion or contraction.

Seasonality and limitations: Seasonal adjustment is common to reduce predictable quarterly patterns, but QoQ figures can still be volatile due to holidays, weather, or one-off events. One-quarter results may be influenced by temporary factors and revisions to initial data can alter the reported QoQ change. Therefore, QoQ is most informative when interpreted alongside YoY comparisons and longer-term trends.

Relation to other measures: Compared with year-over-year (YoY) growth, QoQ emphasizes near-term momentum, while YoY smooths seasonal effects and highlights longer-run changes. Both measures provide complementary views of performance.