Guidance

Guidance means a company’s forecast or estimate about its future business performance. In simple terms, guidance is what a company says it expects to happen next. Guidance is important because investors care about the future, not only the past. A company can report strong results but disappoint investors if its guidance is weak. For example, a company may say it expects next quarter’s revenue to be between $5 billion and $5.3 billion. That forecast is guidance. Guidance is not a guarantee. It is an estimate based on current expectations, and actual results can be better or worse.