In finance, LTM stands for Last Twelve Months, a rolling figure that captures a company’s most recent four quarters of performance on any income statement or cash flow line. It gives you an annualized number that stays current between annual reports, smooths out single-quarter noise, and updates every time a new quarterly filing lands. The terms Last Twelve Months and Trailing Twelve Months (TTM) mean the same thing and are used interchangeably.
LTM works on any quarterly metric: revenue, net income, EBITDA, free cash flow, gross profit, or anything else a company reports on its 10-Q and 10-K. It is the default input for most trading multiples, credit ratios, and covenant tests because it reflects operational reality faster than a static fiscal year figure.
How to Calculate LTM
There are two standard methods, and both produce the same answer when the underlying data matches.
The first is a straight sum of the four most recent consecutive quarters. If you want LTM Revenue as of the end of Q2 2025, add revenue from Q3 2024, Q4 2024, Q1 2025, and Q2 2025. Four quarters, one number.
The second is useful when you have the prior year’s annual figure but not every quarterly breakdown. Take the previous fiscal year total, subtract the year-ago quarter you’re replacing, and add the most recently reported quarter. Say a company reported $100 million in total 2024 revenue. Q1 2024 revenue was $20 million, and Q1 2025 just came in at $25 million. LTM revenue equals $100 million minus $20 million plus $25 million, or $105 million. That figure covers the trailing four quarters ending Q1 2025.
LTM figures update four times a year. Companies file Form 10-Q for each of the first three fiscal quarters, and the fourth quarter is captured in the annual Form 10-K instead of a separate 10-Q.1Securities and Exchange Commission. Form 10-Q General Instructions Your LTM number should be recalculated after each of those filings.
Where to Pull the Quarterly Data
The most reliable free source is the SEC’s EDGAR database. The full-text search at sec.gov/edgar/search lets you look up any public company by name, ticker, or CIK number and filter to annual, quarterly, and current reports.2U.S. Securities and Exchange Commission. EDGAR Full Text Search From there, pull the income statement or cash flow statement out of the latest 10-Q and 10-K.
Professional analysts typically work off Bloomberg, Capital IQ, or FactSet, which automate LTM calculations and refresh as soon as filings hit EDGAR. Free financial sites also display TTM figures for common metrics like revenue and EPS, though the underlying inputs still trace back to SEC filings. Whatever source you use, confirm the quarter-end dates line up. A misaligned quarter throws off the whole calculation.
LTM vs. Fiscal Year Data
The difference is timing. Fiscal year (FY) data is a fixed snapshot covering a predetermined 12-month period, and it updates only once a year when the 10-K is filed. Large accelerated filers have 60 days after fiscal year end to file, accelerated filers get 75 days, and all other companies get 90 days.3Securities and Exchange Commission. Form 10-K General Instructions A company with a December 31 year end might not file until early March, and by summer, those numbers are already more than half a year old.
LTM avoids that staleness by rolling forward with each quarterly filing. An LTM figure calculated at the end of September for that same December-year-end company already incorporates nine months of the current year’s performance. The FY number still reflects the prior calendar year in full.
LTM is also the fix for comparing companies with different fiscal calendars. If Company A closes its books in December and Company B closes in June, their latest annual reports cover completely different economic periods. Calculating LTM for both through the same quarter-end date puts them on equal footing.
Valuation Metrics Built on LTM
Most real-time valuation work runs on LTM denominators. Using last fiscal year’s data when fresher quarterly results exist can meaningfully distort how expensive or cheap a stock looks.
Trailing Price-to-Earnings
The trailing P/E divides the current share price by LTM earnings per share. It’s the most widely quoted valuation multiple for individual stocks. Because the denominator rolls forward, the ratio picks up recent earnings growth or decline instead of waiting for the next annual report.
EV to EBITDA
EV/LTM EBITDA divides enterprise value (market cap plus net debt) by trailing twelve months of earnings before interest, taxes, depreciation, and amortization. It’s the workhorse multiple in mergers-and-acquisitions and leveraged buyout modeling. Enterprise value accounts for capital structure differences, and EBITDA strips out varying tax rates, depreciation methods, and financing choices, so two companies generating the same operating cash flow look equivalent even if one carries far more debt.
Leverage and Interest Coverage
Lenders and rating agencies use LTM EBITDA as the denominator in leverage ratios. Debt-to-EBITDA (total debt divided by LTM EBITDA) measures how many years of current earnings would be needed to pay off outstanding debt. Lower is stronger. Interest coverage flips the ratio: LTM EBITDA (or EBIT) divided by annual interest expense, with higher numbers signaling more cushion. Both ratios lose their diagnostic value if you plug in stale annual data.
EV to Revenue
EV/LTM Revenue is common for companies that aren’t profitable yet, especially in technology and biotech. With no earnings to work with, the multiple compares enterprise value against the trailing sales base. The LTM denominator prices today’s revenue run rate rather than a figure from a fiscal year that ended months ago.
Free Cash Flow Yield
LTM free cash flow (operating cash flow minus capital expenditures) divided by market capitalization gives the free cash flow yield: the percentage of the stock price the company generates in actual spendable cash. Capital expenditures can be lumpy quarter to quarter, so a full trailing twelve months smooths those swings.
LTM vs. NTM (Forward) Multiples
LTM looks backward at actual results. NTM (Next Twelve Months) looks forward at projected results, usually based on consensus analyst estimates. Both show up side by side in equity research.
LTM’s advantage is objectivity. The numbers come from audited or reviewed financial statements, not forecasts. The drawback is that backward-looking data can misrepresent a company whose trajectory is changing fast. A business that just lost a major customer or signed a transformational contract looks the same in its LTM figures for several more quarters.
NTM captures expected growth or decline, which is why it dominates for high-growth companies and cyclical businesses where next year will look materially different from last. The tradeoff is subjectivity: analyst forecasts involve judgment, and if consensus is wrong, the NTM multiple is wrong too. During earnings season, NTM denominators can shift on a single guidance revision.
LTM tends to dominate in leveraged buyout analysis and credit work because lenders want to underwrite against demonstrated performance. NTM dominates in growth equity and software, where a company’s current run rate barely resembles its trajectory. A wide gap between the two for the same company signals that the market expects significant change ahead.
LTM in Debt Covenants
Outside equity valuation, LTM figures drive credit agreements. Most leveraged loans and private credit facilities include maintenance covenants that test financial ratios quarterly against trailing twelve months of data. A typical covenant might cap funded Debt-to-EBITDA at a specified ceiling, tested each quarter using LTM EBITDA.
The “LTM EBITDA” defined in a credit agreement is rarely raw GAAP net income with standard add-backs. Borrowers negotiate specific adjustments: restructuring charges, transaction fees, non-cash compensation, and sometimes projected cost savings from recent acquisitions. These negotiated definitions can meaningfully inflate the EBITDA figure and widen the cushion against covenant thresholds. When analyzing a leveraged company, the credit agreement’s EBITDA definition matters as much as the arithmetic.
Breaching a maintenance covenant, even without missing a payment, gives the lender the right to accelerate the loan. In practice, lenders often grant a waiver, but waivers usually come with fees, higher interest rates, tighter future covenants, or additional collateral. A covenant breach can also trigger cross-default provisions in other debt agreements, cascading into a broader crisis. Quarterly LTM calculations are a compliance obligation for leveraged companies, not just an analytical exercise.
Adjustments Before You Use the Number
Raw LTM data straight off the financials often needs cleaning. The goal is to isolate sustainable, recurring earning power.
Stripping Out One-Time Items
Scan all four quarters in the LTM window for non-recurring events: large legal settlements, restructuring charges, gains or losses from selling a division, or the impact of a major tax law change. Reversing their after-tax effect produces a “normalized” or “adjusted” LTM figure that better represents what the business earns in a typical year. Sell-side research reports usually label these adjustments explicitly, and disagreements over what counts as non-recurring are one of the most common sources of valuation disputes.
Pro Forma for Acquisitions and Divestitures
When a company completes a significant acquisition during the LTM period, the raw data only includes the target’s results from the closing date forward. If the deal closed six months ago, you’re looking at half a year of the combined entity and half a year of the standalone company. That’s not a usable baseline.
The standard fix is a pro forma adjustment: add the acquired company’s historical results for the portion of the LTM window before the deal closed, as if the acquisition had been in place the whole time. SEC Regulation S-X requires companies to file pro forma financial statements for significant acquisitions, which gives you a starting point.4eCFR. 17 CFR 210.11-01 – Presentation Requirements The same logic applies in reverse for divestitures: subtract the sold business’s contribution from the quarters before the sale closed.
Seasonality
Because LTM spans a full annual cycle, it inherently captures seasonal patterns that would skew any single-quarter view. A retailer’s LTM revenue always includes the holiday quarter, whether you run the numbers in March or September. The subtler risk is comparing an LTM figure to a single quarter’s annualized run rate for a business with strong seasonal swings, which can be badly misleading. LTM against prior LTM works fine.
When LTM Misleads
LTM is the default, but several situations call for a different lens.
High-growth companies are the classic case. A software business growing revenue at 60 percent annually looks far more expensive on LTM multiples than on forward estimates, because last year’s revenue barely resembles next year’s. Investors weight NTM or further-out projections more heavily, and an LTM screen would flag most fast growers as overvalued.
Turnaround situations run the opposite way. A company that just replaced management, cut costs, and restructured may have terrible LTM figures that include quarters of poor performance under the old regime. The trailing numbers don’t reflect the new operating reality, and relying on them would undervalue the business.
Cyclical businesses near a peak or trough also distort LTM analysis. Calculate LTM EBITDA for an oil producer when crude prices are at multi-year highs and the Debt-to-EBITDA ratio looks artificially healthy. The same company’s leverage looks dramatically worse when commodity prices drop, even if nothing about the business itself has changed. Credit analysts in these industries use mid-cycle or normalized EBITDA instead of raw LTM.
And any company that completed a major acquisition or divestiture within the trailing twelve months needs pro forma treatment. Using the raw LTM figure without adjustment compares an entity that existed for only part of the period against its full enterprise value, which produces a meaningless multiple.
Filing Timelines and Data Freshness
LTM only works if quarterly filings actually arrive on time. Large accelerated filers and accelerated filers must submit each 10-Q within 40 days of the quarter’s end; all other filers get 45 days.1Securities and Exchange Commission. Form 10-Q General Instructions For a December year-end company, Q1 data (ending March 31) is typically available by mid-May, Q2 by mid-August, and Q3 by mid-November. Q4 comes with the 10-K, due 60 to 90 days after fiscal year end depending on filer status.3Securities and Exchange Commission. Form 10-K General Instructions
If a company can’t meet a filing deadline, it must file Form 12b-25 (Form NT) requesting an extension and disclosing why the report is late, along with any anticipated significant changes in operating results compared to the prior year.5U.S. Securities and Exchange Commission. SEC Charges Eight Companies for Failure to Disclose Complete Information on Form NT A company consistently late with filings is a warning sign. At minimum, your LTM is running on stale inputs. At worst, the delays hint at accounting problems that could lead to restatements, which would retroactively change the quarterly figures your LTM was built on.
For anyone maintaining LTM-based models, track each company’s actual filing dates rather than assuming they hit the deadline. The gap between a quarter closing and its data becoming public is the window in which your LTM figure is least reliable, and that gap varies across companies.