Most US companies seen sticking with quarterly reporting

• Major investors warn companies switching to semiannual reporting risk being 'downsized or removed from portfolios' or having valuations reconsidered due to reduced transparency
• JPMorgan Chase stated it would continue quarterly reporting and guidance despite supporting the proposal, while smaller companies and IPO candidates may be more likely to adopt less frequent reporting
• The number of publicly traded U.S. companies has declined from 8,800 in the late 1990s to approximately 4,200, with proponents arguing reduced reporting requirements could help reverse this trend

Summary

The Trump administration's proposal to make quarterly earnings reporting optional for U.S. public companies is unlikely to see widespread adoption, according to investors and market analysts. While the SEC plan aims to reduce costs and help firms focus on long-term strategy, most established companies are expected to maintain quarterly reporting to avoid investor penalties.

Key Opposition: Major investors including Citadel (Ken Griffin's hedge fund), Fidelity, and WisdomTree Asset Management warn that companies switching to semiannual reporting could face valuation downgrades, portfolio exclusions, and perceptions of higher risk. "We want, we need, more information, not less," stated Sam Rines of WisdomTree. Critics argue reduced reporting could increase market volatility and capital costs.

Industry Support: JPMorgan Chase, despite supporting the proposal, confirmed it would continue quarterly reporting and guidance. Nasdaq and major exchanges back the change, citing it as necessary to boost IPO activity and reverse the decline in publicly traded companies—from 8,800 in the late 1990s to approximately 4,200 currently.

Potential Beneficiaries: Smaller companies and IPO candidates may benefit most from reduced reporting burdens. Sectors like biotech, where multi-year innovation cycles matter more than quarterly metrics, could also find semiannual reporting advantageous. However, even small-cap firms may maintain quarterly updates to compensate for declining analyst coverage.

Timeline: The SEC, under Chair Paul Atkins, has not specified when the proposal will be released but indicated the market should determine optimal reporting frequency based on company-specific factors.

Bottom Line: Glenmede's Mike Reynolds summarized market expectations: "The vast majority of companies will continue to report quarterly."