Guidance

Guidance is the outlook management gives, usually alongside quarterly results. It is often a range rather than a single number and can cover revenue, earnings per share, margins or spending.

US companies are not required to give guidance, and some choose not to. Those that do may raise, lower or maintain it from one quarter to the next.

A stock’s reaction to an earnings report often depends as much on guidance as on the quarter just reported, because guidance changes expectations for the periods ahead. Analysts compare it with their own consensus estimates.