Why Semi-Annual Earnings May Not Open the IPO Floodgates

The US Securities and Exchange Commission is considering allowing public companies to report earnings only twice a year, according to The Wall Street Journal. But analysts say that would be unlikely to usher in an IPO wave.

The growing access to private capital, coupled with regulatory changes over the past two decades, has resulted in fewer companies going public. Regulators and investors have been looking for ways to reverse that trend.

“Founders could view [the] proposed change as directionally positive for the IPO pipeline, and it addresses a potential friction point,” says Mike Bellin, US head of IPOs at PwC. “However, it is unlikely to be the decisive variable that unlocks a wave of unicorn IPOs.”

The SEC could publish its proposal as soon as next month, according to The Wall Street Journal. It would then be subject to the usual process: a 30-day public comment period, followed by a commission vote. So there are no guarantees that the changes will happen.

While some mid-cap companies could be swayed to take the public listing leap, the high-flying companies seen as true bellwethers would still feel pressure to stick to the quarterly cadence. “Their investor base and their lenders … are going to require quarterly financial reports in any event,” says Albert Vanderlaan, head of capital markets at Orrick. Case in point: Many companies listed on UK and European exchanges, which are only required to report twice a year, still elect to do so every quarter.

“The companies that do go public because of this change … aren’t the companies that most people would want to invest in out of the gate,” says Kyle Stanford, PitchBook’s director of US venture capital research.

Meanwhile, the growing sophistication of the secondaries market—on top of seemingly unlimited private capital supply—has nearly eliminated the pressure for mature VC-backed companies to go public.

Still, for some sectors, such as biotech, the proposed shift could be quite welcome. Pre-clinical biotech companies could avoid some of the dramatic stock fluctuations that can occur after missing earnings expectations. For small- and mid-cap companies, avoiding such short-termism may be a compelling sell.

“The long-term viability of remaining a public company with that additional cost certainly hits the bottom line,” Vanderlaan says. “For companies with a $2 billion-$10 billion market cap, that certainly is an impactful amount of money.”

Biotech IPOs had a strong start to the year, with Generate Biomedicines GENB and Eikon Therapeutics EIKN alone raising more than $700 million in total via public listings. But that’s not enough to shake off the industry’s nerves after a very slow 2025.

And for everyone else, the change probably wouldn’t amount to much. As Bellin points out, what actually matters are “the interest rate and macro environment, the M&A exit alternative, public company preparedness, and whether the gap between private round valuations and public market comps has narrowed enough for founders and their VC sponsors to accept IPO price discovery.”