The SEC’s recent proposal for public companies to opt out of quarterly earnings filings is a positive change, according to eToro (ETOR) CEO Yoni Assia.
The “Make IPOs Great Again” agenda is a step in the right direction, Assia told Yahoo Finance at the Milken Institute Global Conference. The proposal enables “more innovation and unlocking some historical burdens to make sure that people can innovate at faster speeds in the US markets.”
SEC Chair Paul Atkins introduced the proposal on Tuesday, which would give public companies the option to file a new Form 10-S every six months instead of the traditional Form 10-Q every quarter.
While the incentive could potentially entice more private firms to go public, Assia views quarterly reporting as a fundamental duty rather than a burden. He traces this philosophy back to the launch of eToro, when his father — a former public company CEO — gave him a piece of advice.
“He told me, ‘Now you have shareholders. It’s their right to understand everything happening in the company every three months,” Assia recalled. Because of that philosophy, Assia plans to keep delivering shareholder reports, balance sheets, and cash flow updates every 90 days, regardless of any newfound regulatory flexibility.
Despite his own commitment to this frequent cadence, Assia supports the overhaul, describing the progress under Atkins as “amazing.”
“Reducing regulatory requirements doesn’t necessarily mean less information,” Assia argued. He pointed out that many modern companies, including eToro, already provide key performance indicators (KPIs) to their customers and shareholders on a monthly basis. By lowering the regulatory floor, the SEC is allowing companies to be “agile or smarter” about how they communicate their long-term direction, according to Assia.
For retail investors, the concern is often that less frequent reporting leads to greater volatility or more shocks in the market. Assia dismissed this risk, suggesting that established public companies are unlikely to change long-standing habits.
“I don’t think we’ll see a lot of public companies that are already at that rhythm of quarterly shifting to semiannually,” he said.
Instead, the real benefit could be felt by those companies currently on the sidelines. Assia noted that the rigidity of quarterly reporting has historically been a deterrent for firms considering an IPO.
“More public companies [is] better for retail investors,” Assia concluded.
Francisco Velasquez is a Reporter at Yahoo Finance. Follow him on LinkedIn and X. He can be reached at [email protected].
