Investors Flood SEC With Record Opposition to Semiannual Earnings Plan
A Securities and Exchange Commission proposal to let public companies report earnings every six months instead of quarterly has drawn more than 280,000 comments, the vast majority opposed, with investors warning that reduced transparency would raise the cost of capital and weaken oversight of retirement savings.
A Securities and Exchange Commission proposal that would allow publicly traded companies to report earnings every six months instead of every three months has triggered an unprecedented wave of public opposition, with investors warning that the change would weaken oversight of corporate performance and raise the cost of raising capital.
The proposal, released for public comment in May 2026, would scrap a quarterly disclosure requirement that has been in place since 1970. Under the plan, registered companies could choose to report financial results semiannually rather than quarterly. The SEC says the change is intended to reduce compliance costs tied to preparing financial statements and to encourage longer-term corporate planning instead of a short-term fixation on quarterly earnings. A final decision is expected by late 2026.
Since the comment period opened, more than 280,000 letters have been submitted, the vast majority opposing the measure. By comparison, one study covering 417 separate proposals over 30 years tallied just over 65,000 comment letters in total. According to a tracker built by an accounting professor who reviewed the SEC docket, more than 99% of the comments run against the proposal, many from retail and individual investors.
The central concern raised by opponents is that less frequent reporting would make it harder for investors to monitor how companies are performing and making decisions, because key information would be withheld for longer stretches. That reduction in transparency carries a second risk: it would likely make it more expensive for companies to raise capital. With less external monitoring, investors may demand a higher rate of return to compensate for the added uncertainty about a company's health, whether through share sales, bank borrowing, or bond issuance.
Commenters described the stakes in personal terms. One wrote that her husband had worked for Enron and that the family lost most of its retirement savings when the company's fraudulent activity came to light, adding that quarterly reporting acts as a gatekeeper and should be kept. Another compared quarterly reports to a child's report card, noting that investors, unlike parents working with a teacher, lack the ability to catch failing performance early and course-correct.
Industry groups have echoed those concerns. The Securities Industry and Financial Markets Association, a trade group, wrote that the estimated net savings from the proposal could be offset or outweighed by an increase in the cost of capital as investors demand higher risk premiums for less timely information. Federated Hermes, an asset manager, warned that companies electing semiannual reporting could face signaling risks, since investors might read the choice as a sign of reduced transparency, potentially affecting analyst coverage and the cost of capital.
Some commenters also disputed the SEC's projected savings. The proposal estimates average compliance savings of roughly $200,000 a year per firm, an amount critics describe as negligible for a typical public corporation. More broadly, the comments reflect how directly the rule could affect ordinary investors, since retirement savings held in 401(k) plans and individual retirement accounts are exposed to company performance regardless of whether a given fund is diversified.
Corporate reaction has been mixed. It remains too early to say how many companies would adopt the six-month option, but several have signaled they would. Drugmaker Eli Lilly stated its preference for less frequent reporting in its official comment, and Financial Executives International, an industry lobby, said 58% of the member companies it surveyed indicated they would make the change.
The commission is still reviewing the feedback before its leadership votes. The SEC is traditionally led by five commissioners, three from the party in power and two from the opposition, but the two Democratic seats are currently vacant and one Republican seat is about to be vacated. With so few votes on hand, the commission suggested on September 30, 2026, that it could change its rules so the proposal would clear with support from only two commissioners. SEC Chair Paul Atkins has said the commission is moving ahead, leaving open the question of how many companies would ultimately embrace semiannual reporting given the concerns raised.
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