Understand the numbers in a company report

Choose your starting point

ChatGPT · Claude · Gemini

The guide is free; the tool feature you use may depend on your account. Open a tool’s introduction for the relevant capabilities and source documentation.

From idea to a useful result

1. Copy the relevant table and its headings. Include the reporting period, currency, unit scale and notes; a number without these can be misleading.
2. Ask for a fact sheet first, then the calculations and a plain-language explanation. Require the source label beside each figure.
3. Recalculate the important changes. List what the excerpt cannot tell you before using it to make a decision.

Try this

Explain this fictional company excerpt to a beginner. Source: Example Co annual summary, table A. Figures in USD thousands. Year 1: revenue 100, operating costs 80. Year 2: revenue 120, operating costs 102. For this simplified exercise, operating profit = revenue minus operating costs. Produce a sourced fact table, revenue growth, operating profit in each year and operating margin. Explain whether higher sales meant a higher margin. Do not invent net profit, cash flow, debt, stock price or an investment recommendation.

What a useful result looks like

Revenue rose from 100 to 120 thousand USD: growth = (120 − 100) / 100 = 20%. Operating profit was 20 thousand in Year 1 and 18 thousand in Year 2. Operating margin fell from 20 / 100 = 20% to 18 / 120 = 15%. Sales grew, but the supplied costs grew faster. This excerpt does not explain why costs rose or show how much cash the company generated.

Check the result

Each source figure comes from table A; calculated figures must be labeled as calculations. The unit is thousands, so 18 means USD 18,000. A margin decline is something to investigate, not enough information to buy or sell a stock.

Original simplified teaching example; no company performance or external model response is represented.