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The financial world splits up its calendar into four quarters, each three months long.
If January to March is the first quarter, April to June is the second quarter, and so on, though a company's first quarter does not have to begin in January.
The Securities and Exchange Commission (SEC) requires all publicly held US companies to publish a quarterly report, officially known as Form 10-Q, describing their financial results for the quarter. These reports and the predictions that market analysts make about them often have an impact on a company's stock price.
For example, if analysts predict that a certain company will have earnings of 55 cents a share in a quarter, and the results beat those expectations, the price of the company's stock may increase. But if the earnings are less than expected, even by a penny or two, the stock price may drop, at least for a time.
However, this pattern doesn't always hold true, and other forces may influence investor sentiment about the stock.
One-fourth of a year. For 2007, January, February, and March would be written as 1Q07; April,May,and June would be 2Q07,and so on.