How to calculate Revenue Growth Rate

Formula

Revenue growth rate = (revenue this period − revenue last period) ÷ revenue last period

SQL query

This example assumes: invoices(id, invoice_date date, amount numeric, status text). It is written in PostgreSQL syntax; date functions differ slightly in MySQL, BigQuery and SQLite, and your column names will differ from these.

WITH yearly AS (
  SELECT EXTRACT(YEAR FROM invoice_date)::int AS year,
         SUM(amount) AS revenue
  FROM invoices
  WHERE status <> 'void'
  GROUP BY 1
)
SELECT year,
       revenue,
       (revenue - LAG(revenue) OVER (ORDER BY year))
         / NULLIF(LAG(revenue) OVER (ORDER BY year), 0) AS growth_rate
FROM yearly
ORDER BY year;

Common mistakes that make Revenue Growth Rate wrong

• Invoiced revenue is not always recognised revenue; subscriptions and deferred revenue need the recognition schedule.
• Voided invoices and credit notes must be excluded or netted.
• A partial current year will show as a decline; compare year-to-date to the same period last year instead.

Ask for Revenue Growth Rate in plain English

Instead of writing the query yourself, you can type the question. SchemaChat turns it into SQL against your connected database or uploaded file, runs it, and shows the SQL and the figures it used so you can check the answer before you share it. It does not replace your judgement about the definition: check that the query matches the formula your business uses.

• What was our revenue growth rate for each of the last 5 years?
• How does this year to date compare with the same period last year?