Learn / Fundamentals / Profitability / Revenue Growth
Revenue Growth = (This Year − Last Year) ÷ Last Year
Revenue growth tells you how fast sales are rising compared with last year. A bigger business is not always a better one, but speed on the top line is where many stories start.
01 Feel it first
Last year is fixed at $100M. Slide this year's sales and watch the year-over-year growth percentage update live.
02 Break the intuition
Fast top-line growth can still leave thin margins and weak cash. Reveal what collapsed underneath.
03 Race it
Company A and Company B both started at $100M of sales last year. Hit Race to compare their growth rates side by side.
Hit Race to compare the lanes side by side.
04 Watch the path
Pick a path and press Play. Watch how 20% vs 4% annual growth compounds sales over ten years.
Illustrative 10-year sales paths from a $100M base.
Pick a path, then press Play to watch the years fill in.
05 Two flavors
YoY growth is one lap. CAGR (compound annual growth rate) smooths many years into one average speed.
06 The catch
A utility at 3% and a software firm at 25% can both be healthy for their peer group.
07 Check yourself
08 Where it breaks
Cutting prices or running promotions can inflate sales while destroying margin. The top line looks fast; the business gets weaker.
Buying another company adds revenue instantly. Strip out deals to see if the core business is actually growing.
A weak prior year makes this year look heroic. Always look at several years, not one lucky lap.
Inventory and receivables can swell with sales while cash lags. Pair growth with margins and operating cash flow.
Open any ticker for sales growth history beside margins and cash, then screen peers by how fast the top line is moving.
Sales moved from $100M to $120M. That is +20% revenue growth. One year of speed, not a promise forever.