How to Annualize Quarterly Numbers

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A company's quarterly figures give you details about its financial operations over a three-month period. You can, however, convert these figures to annualized numbers to get a sense of how they translate to a full financial year. The method for doing this varies slightly based on whether you are annualizing a single quarter's numbers, four quarter's numbers or another period of time. Use the correct method for the data that you have available.

  • Multiply quarterly absolute numbers, such as dollar figures, by four to get the annualized numbers if you are basing it off of one quarter. Percentages do not need to be converted in this case.

  • Add the quarterly absolute numbers if you are basing the annualized figures on four quarters. To annualize percentages based on four quarters add them together and divide by four.

  • Add up all of the quarterly absolute numbers if you are using a number of quarters other than four or one. Divide the total by the number of quarters and multiply the quotient by four to get the annualized numbers. For percentages, add them all together and divide by the number of quarters.

References

  • "Financial Accounting: An Introduction to Concepts, Methods and Uses"; Clyde P. Stickney et al.; 2009
  • "Accounting: Concepts and Applications"; W. Steve Albrecht et al; 2007
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