Trailing Twelve Months (TTM) | Formula + Calculator (2024)

How to Calculate TTM Revenue

TTM stands for “Trailing Twelve Months” and is a backward-looking metric that portrays the financial performance of a company as of its most recent four reporting quarters.

TTM (“Trailing Twelve Months”)—often used interchangeably with the term LTM (“Last Twelve Months”)—is used by practitioners to analyze a company’s recent financial performance.

Conceptually, the trailing twelve months (TTM) is a measure of a company’s financial performance in the most recent 12-month period.

In effect, a metric presented on a trailing twelve-month basis, such as TTM revenue, is intended to reflect the most up-to-date, current state of a company’s growth trajectory and profitability.

In practice, the two most common metrics presented on a trailing twelve-month basis are TTM revenue and TTM EBITDA.

• TTM Revenue ➝ TTM revenue is determined by summing the reported revenue from the last four consecutive quarters, offering a dynamic and rolling measure of a company’s financial performance.
• TTM EBITDA ➝ Likewise, TTM EBITDA is equal to the sum of a company’s EBITDA from the past four quarters on a rolling basis to measure operating performance.

The continuous update attributable to TTM financial data facilitates the identification of patterns in a company’s operating performance, while “smoothing out” seasonal fluctuations.

The process of adjusting a financial metric like revenue, operating income (EBIT), or EBITDA, comprises adding the most recent period past the latest reported fiscal year and subsequently deducting the matching period (i.e. the “stub period” adjustment).

The required financial filings to perform such a calculation are the company’s latest 10-K, most recent quarterly filing(s), and the corresponding filings from the year prior.

To calculate a company’s TTM revenue, the following three steps can be followed.

• Step 1 ➝ Compile Annual Report (10-K) and Latest Quarterly Reports (10-Q)
• Step 2 ➝ Add the Year-to-Date (YTD) Data to the Fiscal Year Data
• Step 3 ➝ Subtract the YTD Data from the Prior Year

Trailing Twelve Months Formula (TTM)

The formula for calculating a financial metric on a trailing twelve-month basis is as follows.

Trailing Twelve Months (TTM) = Latest Fiscal Year Data + Current YTD Data – Prior YTD Data

Where:

• Latest Fiscal Year Data ➝ The financial data reported in the most recent fiscal year.
• Current YTD Data ➝ The financial data reported year-to-date, beyond the most recent fiscal year.
• Prior YTD Revenue ➝ The financial data reported year-to-date for the corresponding period in the prior fiscal year.

TTM Income Statement Financial Data Example

For a real-world example, suppose an equity analyst is tasked with updating a financial model to reflect the TTM income statement data of Alphabet (GOOGL).

Alphabet recently reported its Q1 earnings (03/31/2024), thereby the equity analyst must add the recent Q1-24 financial data to the FY-23 financial data and then deduct the financial data from the period (Q1-23).

The reported revenue data of Alphabet—derived from financial data platform Daloopa—is as follows:

If the Q-4 revenue data is explicitly stated, the calculation process is straightforward.

TTM Revenue = Revenue (Q2-2023) + Revenue (Q3-2023) + Revenue (Q4-2023) + Revenue (Q1-2024)

Upon plugging the historical financial data of Alphabet into the formula above, we arrive at $318,146 million in TTM revenue.

• TTM Revenue = $74,604 million + $76,693 million + $86,310 million + $80,539 million = $318,146 million

The Q-4 revenue data, however, is seldom broken out separately on the income statement.

Therefore, the more practical formula to compute the TTM revenue—where the Q-4 financial data is consolidated within the FY data—is as follows.

TTM Revenue= Latest Fiscal Year Revenue + YTD Revenue − Prior YTD Revenue

Given those data points from earlier, we’ll insert the reported revenue figures of Alphabet into the TTM formula.

TTM Revenue= Revenue (FY-2023) + Revenue (Q1-2024) − Revenue (Q1-2023)

The TTM revenue of Alphabet (GOOGL), as of the end of Q1-2024, is $318,146 million, like before.

• TTM Revenue = $307,394 million + $80,539 million − $69,787 million = $318,146 million

^{TTM Income Statement Financial Data Example (Source: Daloopa)}

TTM vs. NTM Revenue: What is the Difference?

TTM (“Trailing Twelve Months”) and NTM (“Next Twelve Months”) are two methods to analyze and present the revenue performance of a company, with each metric providing practical insights that pertain to growth.

In short, TTM revenue reflects historical data (”Actual”), while NTM revenue is derived from a pro-forma forecast (”Projected”).

The primary difference between TTM and NTM revenue is that TTM revenue is based upon historical performance, offering a reliable, factual perspective into the financial state of a company.

In contrast, NTM revenue is oriented around pro-forma financial performance obtained from a forecast model, providing insights into expected growth and performance.

Trailing Twelve Months Calculator (TTM) — Excel Template

We’ll now move on to a modeling exercise, which you can access by filling out the form below.

TTM Revenue Calculation Example

Suppose we’re tasked with calculating the revenue, operating income (EBIT), and EBITDA of a company on a trailing twelve-month basis (TTM).

To calculate the trailing twelve-month (TTM) metrics for revenue, EBIT, and EBITDA, the following formula will be applied to each.

• TTM Revenue = Latest Fiscal Year Revenue + YTD Revenue − Prior YTD Revenue
• TTM EBIT = Latest Fiscal Year EBIT + YTD EBIT − Prior YTD EBIT
• TTM EBITDA = Latest Fiscal Year EBITDA + YTD EBITDA − Prior YTD EBITDA

Upon inserting our assumptions into each corresponding formula, we arrive at $600 million, $264 million, and $ 148 million for TTM revenue, TTM EBIT, and TTM EBITDA, respectively.

• TTM Revenue = $520 million + $180 million − $100 million = $600 million
• TTM EBIT = $220 million + $84 million − $40 million = $264 million
• TTM EBITDA = $121 million + $47 million − $20 million = $148 million

In Excel, the TTM EBITDA formula is equal to FY-23 EBITDA (Cell I10) plus Q1-24 EBITDA (Cell J10), subtracted by Q1-23 EBITDA (Cell E10).

Technically, we could compute TTM EBITDA as the sum of each quarter, but for illustrative purposes, we’ll use the more practical formula mentioned earlier.

The updated income statement—with the TTM financial data in the far right column—is as follows:

The differential between the FY-2023 operating performance and TTM operating performance is substantial. Hence, financial models must be constantly updated, especially since the 3-statement model is the basis for practically all valuation models, including a discounted cash flow (DCF) analysis, trading comps, transaction comps, and leveraged buyout (LBO) models.

In closing, the TTM financial data reflects the current operating performance of our hypothetical company more accurately.

Considering the fact that the allocation of capital and investments are selected based on analyzing a company’s reported financial data, ensuring a financial model is continuously updated with the most up-to-date and reliable, publicly available data is a necessity for sound decision-making.