A quick guide on how to calculate year-over-year growth

Measuring progress isn’t just about checking if numbers went up. It’s about understanding how much they changed compared to the same time last year. That’s what year-over-year (YOY) growth helps you see.

Whether you’re running a business, managing a team, or overseeing a marketing campaign, tracking YOY growth gives you a reliable sense of how well things are going.

In this guide, we’ll break down how to calculate year-on-year growth, how it works during different seasons, and why you might want to work with finance professionals to get it right.

What is year-over-year (YOY) growth?

Year-over-year growth is a method of comparing one period (usually a month or quarter) with the same period from the previous year.

For example: If you earned $100,000 in revenue this July and made $80,000 last July, your YOY growth is 25%. This comparison removes seasonal fluctuations and gives you a clearer picture of long-term trends.

Businesses use YOY growth to track performance across revenue, profit, customer acquisition, website traffic, etc. Investors and analysts rely on it to evaluate company health and momentum.

It’s a simple way to spot whether you’re gaining ground, holding steady, or slipping backward.

According to Financial Edge, a YOY growth rate between 10% to 20% is generally already considered healthy in most sectors.

How to calculate year-over-year growth

The formula for YOY growth is fairly simple:

Year-over-Year Growth (%) = [(This Year Value – Last Year Value) / Last Year Value] x 100

Let’s say your e-commerce business generated $120,000 in sales in Q2 this year, compared to $100,000 in Q2 last year. Plugging into the formula:

YOY Growth = [($120,000 – $100,000) / $100,000] x 100 = 20%

This means your business grew 20% year-over-year in Q2.

The key is consistency. Always compare the same time frames (month to month, quarter to quarter, or year to year) so you’re not mixing apples and oranges.

How to compute YOY growth during different times of the year

Calculating YOY growth isn’t just for year-end reports. You can use it any time of the year to track progress and identify trends.

Here’s how it works across different periods:

• Monthly YOY Growth – Compare a specific month this year to the same month last year. For example, compare July 2025 to July 2024.
• Quarterly YOY Growth – Compare Q2 2025 to Q2 2024. This is helpful for businesses that operate in seasonal cycles.
• Trailing Twelve Months (TTM) – Add up the total for the last 12 months and compare it to the 12 months before that. TTM is especially useful for smoothing out seasonal spikes and giving a broader view.
• YTD (Year-to-Date) YOY Growth – Compare the cumulative data from the beginning of the year up to the current date with the same period in the previous year. For example, compare January to June 2025 with January to June 2024.

Each version gives you slightly different insights depending on what you’re measuring. The key is to be consistent with your time frames and clear about what exactly you’re comparing.

Examples of YOY growth calculations

Let’s go through a few realistic examples to make it all click:

• Retail revenue

Last year: $500,000 in Q3

This year: $600,000 in Q3

YOY Growth = [(600,000 – 500,000) / 500,000] x 100 = 20%

• Website traffic

July 2024: 40,000 visitors

July 2025: 48,000 visitors

YOY Growth = [(48,000 – 40,000) / 40,000] x 100 = 20%

• Employee headcount

150 employees in January 2024

165 employees in January 2025

YOY Growth = [(165 – 150) / 150] x 100 = 10%

These numbers may seem small, but as we’ve mentioned, even a 10% YOY growth in revenue or customers can mean a huge difference in the long run.

On the flip side, negative growth helps you spot issues early before they escalate.

Work with finance professionals for your YOY computations

While YOY growth is easy enough to calculate, interpreting the numbers can be tricky.

For example, a spike in revenue might look great, but it could be due to one-time factors like a major client or a price increase (not sustainable growth).

Finance professionals and outsourced accounting services can help contextualize your YOY growth. They dig into what’s driving the change, flag anomalies, and help you plan smarter. They can also track multiple metrics over time and create reports that support your long-term strategy.

Deloitte even reported that a vast majority (96%) of executives obtain their data and analytics capabilities from external outsourcing partners. With expert help, your YOY growth data becomes a decision-making tool.

If you’re serious about understanding business performance, learning how to calculate year-over-year growth is non-negotiable. It’s simple, it’s useful, and it offers real insight into whether your efforts are paying off.

Just remember that doing this consistently matters. Always compare the same time periods, look beyond the surface, and seek expert support when needed. That way, your YOY growth figures tell a story you can act on.