Washington, D.C. — President Donald Trump has once again called for U.S. publicly traded companies to abandon the existing requirement of quarterly financial reports and instead file earnings statements every six months. He claims this change would reduce regulatory burdens and shift corporate focus toward longer-term performance instead of short-term results.
What’s Being Proposed
- Trump announced the idea through a post on Truth Social, framing the proposal as a way to “save money” and let company managers concentrate more on running their businesses rather than meeting quarterly expectations.
- The change would require the U.S. Securities and Exchange Commission (SEC) to adopt new rules. Currently, companies are legally required to submit comprehensive financial reports every 90 days (quarterly).
Support & Opposition
Supporters
- Nasdaq CEO Adena Friedman backed the move, asserting that giving companies the option to report semiannually could reduce costs, ease compliance burdens, and promote long-term growth.
- Some corporate leaders believe that frequent reporting contributes to “short-termism,” where executives prioritize meeting next-quarter targets over strategic investments.
Critics
- Opponents warn that less frequent reporting could weaken market transparency and reduce timely disclosure of financial difficulties or risks. Investors rely on quarterly reports to make informed decisions, and less frequent updates could increase uncertainty.
- Legal experts and academics caution that even if regulations change, many firms may still voluntarily shoehorn quarterly disclosures to satisfy investor demand.
Historical & Regulatory Context
- The 90-day quarterly reporting requirement has been in place since 1970. It was introduced to ensure that investors receive regular, standardized updates about a company’s financial health.
- Similar proposals to curb the frequency of reporting, or shift toward semiannual disclosure, have surfaced in past years, including during Trump’s first term in 2018. But none were adopted at that time.
Potential Impact & Next Steps
- If implemented, the shift could alter how investors assess company performance, potentially favoring those with longer investment horizons. Companies might plan with more stability, less focused on immediate quarterly earnings.
- However, the proposal must pass through the SEC rule-making process, which involves public comment, input from stakeholders (investors, companies, analysts), and likely legal scrutiny.
- Markets will watch how the change would affect stock valuation, volatility, and investor confidence. Some analysts believe a move away from quarterly reports could reduce short-term market swings, while others fear delayed warnings for financial downturns.
Why It Matters
This proposal strikes at the heart of a longstanding tension in corporate governance: balancing transparency with flexibility. Quarterly reports have long been a cornerstone of U.S. financial regulation, helping ensure that investors have frequent information about performance. But many business leaders argue that this rhythm can encourage reactive, rather than strategic, decision-making.
How the SEC responds — whether by adopting the proposal, modifying it, or rejecting it — will signal how much weight is given to concerns about regulatory cost and short-termism versus maintaining oversight and market clarity.
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