According to people familiar with the matter, regulators could release the proposal as early as next month, followed by at least a 30-day public comment period before a final vote by the SEC. It should be emphasized that there is no guarantee the proposal will ultimately be adopted. Nevertheless, the possibility alone invites a critical question: if mandatory quarterly reporting is truly abolished, how would the rules of the U.S. stock market change?

What Exactly Would the New Rule Change?

Several media outlets have emphasized that the proposed regulation would likely make quarterly earnings disclosure optional rather than eliminate quarterly reports entirely. In other words, companies that believe quarterly reporting benefits their shareholders could still choose to publish results every quarter.

The key question, however, is not whether companies can continue reporting quarterly, but which companies might choose not to.

The most likely candidates are firms that face intense short-term earnings pressure and prefer to focus on long-term strategy — including technology giants, biotechnology research companies, and traditional businesses undergoing major transformations. By contrast, industries such as retail, banking, and consumer goods — where investors rely heavily on frequent performance data — are more likely to maintain the quarterly reporting cycle.

Who Supports the Change and Who Opposes It?

Momentum for shifting to semiannual reporting began building late last year. In September, the Long-Term Stock Exchange submitted a petition to the SEC calling for the removal of mandatory quarterly reporting requirements. Within days, both former President Donald Trump and SEC Chair Paul Atkins publicly voiced support for the idea.

Supporters argue that the reform could help reverse the declining number of publicly listed companies in the United States. One common reason companies remain private is the administrative burden of going public and maintaining listing requirements. In other words, critics claim that the quarterly reporting system is effectively pushing high-quality companies away from public markets.

Supporters also point to international precedent. Following regulatory changes in 2013, European listed companies are no longer required to disclose financial results every quarter. The United Kingdom eliminated mandatory quarterly reporting roughly a decade ago. In other words, the United States would not be the first to experiment with such a shift — Europe has already done so.

However, opposition remains strong. Critics argue that investors depend on regular disclosures to maintain transparency in financial markets. If reporting frequency falls from four times per year to just two, several consequences could follow: analysts would update forecasting models less frequently, increasing the probability of errors; short-term trading catalysts would become less frequent, potentially reducing market volatility; and information asymmetry could rise, making it harder for ordinary investors to keep pace.

At its core, this policy debate reflects a deeper conflict between two types of capital. Silicon Valley hopes that semiannual reporting will provide greater room for long-term strategy and innovation. Wall Street, on the other hand, emphasizes transparency and timely information disclosure as essential to efficient markets.

If quarterly reporting were ultimately replaced by semiannual reporting, the rhythm of information disclosure in U.S. equities would shift from a four-season cycle to a two-season cycle. Earnings season trading could become more concentrated and crowded, while the periods between earnings releases might become quieter. For long-term investors who rely less on timing, this could be beneficial. For short-term traders who depend on earnings-driven volatility, it could represent a significant disadvantage.