Guide · The ontology
Guidance
In a nutshell
Guidance is a company's own forecast for a metric in a future period, given as a range or a single figure, together with what it did to its earlier forecast: initiated, raised, maintained, lowered or withdrawn. It is what the company expects, not what will happen.
What one holds
- Metric and period. What is forecast, and for when, such as revenue for the full fiscal year.
- Range or point. A low and a high, or one value when the company gives a single figure.
- Action. How it changed the previous forecast: initiated, raised, maintained (also called reaffirmed), lowered, or withdrawn.
- Source. The release or call it was issued in, and the passage.
How firm it is
On earnings calls, management often says more than the formal range: "toward the low end", or "weighted to the second half". Guidance from a call records how firmly it was put:
| Level | Means |
|---|---|
| Firm | A number or range management commits to |
| Directional | A direction, or a position within a range |
| Aspirational | A medium-term goal rather than a forecast |
Reading it
A raise or a cut is often the news in a release, more than the quarter just reported. Guidance is still the company's own view, and companies differ in how cautiously they set it. Nothing on this page is investment advice.