Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Quarter (Q1, Q2, Q3, Q4)

What it is:

A quarter is a three-month period. There are four quarters in one fiscal year, as well as four quarters in each calendar year.

How it works (Example):

In the finance world quarter 1 usually spans January 1-March 31; quarter 2 usually spans April 1-June 30; quarter 3 usually spans July 1-September 30; and quarter 4 usually spans October 1-December 31. For companies that operate on a calendar year basis, here's a closer look at a few recent and upcoming quarterly periods, along with the Q1, Q2, Q3, or Q4 reference associated with each period...

Q1 2018 -- January 1, 2018 to March 31, 2018
Q2 2018 -- April 1, 2018 to June 30, 2018
Q3 2018 -- July 1, 2018 to September 30, 2018
Q4 2018 -- October 1, 2018 to December 31, 2018

Q1 2019 -- January 1, 2019 to March 31, 2019
Q2 2019 -- April 1, 2019 to June 30, 2019
Q3 2019 -- July 1, 2019 to September 30, 2019
Q4 2019 -- October 1, 2019 to December 31, 2019

Q1 2020 -- January 1, 2020 to March 31, 2020
Q2 2020 -- April 1, 2020 to June 30, 2020
Q3 2020 -- July 1, 2020 to September 30, 2020
Q4 2020 -- October 1, 2020 to December 31, 2020

The quarterly periods shown above would be accurate for any company that operates on a calendar year. However, some companies operate on a fiscal year, and they have their own quarterly calendars that typically differ from those shown above. Companies sometimes choose to operate on a fiscal year if they operate in a business that is highly seasonal.

Why it Matters:

Quarters are the time periods around which much of the financial world revolves.

Reports issued that cover the performance during a quarter (called quarterly reports) usually involve a set of financial statements. Public companies in the United States file these reports via Securities and Exchange Commission Form 10-Q.

Quarterly reports help investors take the pulse of the companies they invest in. Comparing the quarterly information to the previous year's information for the same quarter can yield rich insight into how seasonal a company's business is, short-term  performance and growth rates in a variety of measures, and information to compare with  similar companies.