I don’t know if this is com­mon knowl­edge or not (which in my case usu­ally means it is), but Rowan Simp­son gives a con­cise les­son detail­ing the three ways com­pa­nies report their results, and how mis­lead­ing each can be.

  • Size “We made a net profit of $15 million.”
  • Growth “Rev­enues increased by 9%.”
  • Accel­er­a­tion “We added 100,000 new cus­tomers in the last year, 70,000 of these in the last two months.”

To fur­ther illus­trate this point, Rowan looks at other ways to inter­pret Skype’s Q1 2008 results than GigaOm’s acceleration-based inter­pre­ta­tion of “Skype’s growth starts to slow”.

  • Size “Skype reports record rev­enue of $145m.”
  • Growth “Skype increases rev­enue by 26% com­pared to the same period last year.”

via @zambonini