1. What is Year Over Year Growth?

Year-over-year (YoY) growth is a comparison of one period's performance against the same period from the previous year. It's commonly used in financial and business analysis to measure growth rates without seasonal fluctuations.

2. How Does the Calculator Work?

The calculator uses the YoY growth formula:

Where:

• \( Current \) — Current period value (USD)
• \( Prior \) — Prior year's same period value (USD)

Explanation: The formula calculates the percentage change between the current period and the same period in the previous year.

3. Importance of YoY Growth Calculation

Details: YoY growth is crucial for understanding true business performance by eliminating seasonal effects. It helps investors, analysts, and managers assess whether a company is growing or declining.

4. Using the Calculator

Tips: Enter both current and prior period values in USD. The prior period value must be greater than zero for the calculation to work.

5. Frequently Asked Questions (FAQ)

Q1: Why use YoY instead of month-over-month?
A: YoY comparisons eliminate seasonal variations that can distort month-over-month comparisons, providing a clearer picture of growth trends.

Q2: What's a good YoY growth rate?
A: This varies by industry, but generally 10-25% is considered good for most businesses. High-growth companies may aim for 50%+.

Q3: When is YoY growth misleading?
A: When comparing periods affected by one-time events, or when the business model has fundamentally changed year-over-year.

Q4: Can YoY be negative?
A: Yes, negative YoY indicates decline compared to the previous year's same period.

Q5: How does YoY differ from CAGR?
A: YoY measures single-period growth, while CAGR (Compound Annual Growth Rate) measures smoothed growth over multiple periods.