What is Trailing Twelve Months and how is it used in financial analysis?

Trailing 12 Months (T12) or Trailing Twelve Months (commonly abbreviated TTM) is a way of looking at the performance of a company or a security over the last 12 months. It gives investors and analysts a handy way of analysing data that’s not tied to the calendar year or a company’s fiscal year. In other words, TTM refers to the 12 months preceding the current month, or a 12-month period up to the firm’s most recent earnings report or other financial disclosure. TTM figures can also be used to calculate financial ratios. The price/earnings ratio is often referred to as P/E (TTM) and is calculated as the stock's current price, divided by a company's trailing 12-month earnings per share (EPS). The formula for TTM revenue is simply to add up the previous four quarters of revenues to date:

TTM Revenue (for a company reporting semi-annually) = Current H1 earnings + Previous year H2 earnings.

So, if XYZ Corp. generated $29.4 billion in revenue in H1 2022 that just ended, $33.5 billion in the previous year second half (H2 2021), then

TTM revenue would be: $29.4 + 33.5 = $62.9 billion.