Wall Street’s primary regulator, the Securities and Exchange Commission (SEC), announced it is “prioritizing” a proposal from former President Donald Trump aimed at reducing the frequency of corporate earnings reports. This move reignites a long-standing debate over transparency in American capitalism.
The SEC stated it is working on a proposal that would “further eliminate unnecessary regulatory burdens on companies.” This announcement came after Trump called for the elimination of quarterly financial reporting in a social media post earlier this week.
Quarterly Reporting Established in 1970 Post-1929 Crash
Since 1970, the SEC has mandated quarterly reporting for companies, a requirement instituted as part of a broader effort to enhance transparency following the stock market crash of 1929. Abandoning quarterly reports could reshape the dynamics of the equity market by allowing companies to focus less on immediate results and more on long-term strategies.
“Subject to SEC Approval, Companies and Corporations should no longer be forced to ‘Report’ on a quarterly basis (Quarterly Reporting!), but rather to Report on a ‘Six (6) Month Basis,’” Trump stated in his social media post. He asserted that this change would reduce costs and enable managers to concentrate on effectively running their businesses.
Critics, however, caution that moving away from quarterly reports could be detrimental. Nell Minow, chair of ValueEdge Advisors, emphasized that regular reporting fosters trust in the markets, which has contributed to their strength.
Critics argue that frequent reporting increases operational costs, encourages a short-term focus, stifles investment and innovation, and may incite investor overreactions.
The potential impact of Trump’s comments on regulatory changes remains uncertain, but they rekindle essential discussions regarding how corporate performance is evaluated in the U.S. After similar comments made by Trump in 2018, the SEC sought public input on quarterly reporting but ultimately did not finalize any revisions to these requirements.
Nasdaq Supports Flexibility in Reporting
Adena Friedman, CEO and chair of Nasdaq Inc., expressed support for reducing burdens on public companies, including the option for firms to report either quarterly or semi-annually. This proposal was outlined in a policy paper issued earlier this year.
Trump also drew a comparison between the U.S. and China, suggesting that China’s reporting practices are more efficient and cost-effective for businesses. In contrast, in Europe, most companies are only required to report every six months, even though many still choose to provide quarterly updates due to investor expectations.
Proponents of quarterly reporting argue it keeps investors informed and helps mitigate potential market manipulation. “Companies spend far too much time on the churn of quarterly reporting,” said Matt Powell, a veteran sports industry analyst and senior adviser for BCE Consulting, highlighting the need for a balance between operational efficiency and investor information.
Potential Volatility from Less Frequent Reporting
Transitioning to biannual reporting could increase uncertainty and volatility surrounding earnings results. “While the goal would be to encourage a long-term focus among investors and companies, it would also magnify uncertainty in the equity market, potentially lowering valuations,” remarked Brian Nick, head of portfolio strategy at Newedge Wealth. He added that significant earnings misses could become more pronounced and impactful.
SEC Chairman Paul Atkins has previously criticized the disclosure requirements viewed by many companies as burdensome without substantial benefits to shareholders. The agency’s recent regulatory agenda included a potential proposal to “rationalize disclosure practices,” a topic that could encompass a range of measures.
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Published on September 16, 2025
