What is Revenue Growth Rate?
Revenue Growth Rate is the headline top-line growth metric. It's the cleanest indicator of whether a business is expanding or contracting. We typically look at 3-year and 5-year compound annual growth rates (CAGR) alongside the latest year to filter out one-time spikes.
Formula
Revenue Growth = (Current Revenue − Prior Revenue) ÷ Prior Revenue
How TopTier Strategy uses Revenue Growth Rate
Revenue growth rate is the lead indicator in our Growth pillar — paired with EPS growth and free cash flow growth for a complete picture.
Related Glossary Terms
Other concepts in the Growth pillar.
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