Goodbye, 10-Q. Hello, 10-S.

Perspective
Written By Digital Producers

What the SEC's Optional Semiannual Reporting Proposal Could Mean for Publicly Traded Companies

On May 5, 2026, the Securities and Exchange Commission proposed to give all Exchange Act reporting companies that currently file quarterly reports the option to file semiannual reports instead. Under the SEC's proposal, public companies could elect to file one semiannual report and one annual report each year on new Form 10-S, rather than three quarterly reports on Form 10-Q and one annual report on Form 10-K. Companies that prefer the current system could continue quarterly reporting unchanged.

The SEC's proposal

This is a potentially significant shift in the U.S. public company disclosure framework. The proposed Form 10-S would largely mirror today’s Form 10-Q, including MD&A, risk factor updates, and reviewed (but unaudited) financial statements. The key difference is that the filing would cover a six-month period instead of a single quarter.

 The SEC also proposed related amendments to Regulation S-X intended to modernize the “staleness” rules for financial statements so companies using semiannual reporting could continue accessing the capital markets. Importantly, the proposal does not change existing practices around quarterly earnings releases, earnings calls, or guidance. Companies electing semiannual reporting could still provide quarterly earnings updates voluntarily through Form 8-K and other investor communications.

 The SEC framed the proposal primarily as a capital formation and competitiveness initiative. Chairman Paul Atkins described the current quarterly reporting regime as overly rigid and suggested companies and investors should have more flexibility to determine the reporting cadence that best fits their business. He also signaled additional measures would be forthcoming: "Over the next few months, I expect that the Commission will be considering a series of proposals that, if adopted, will not only redefine what it means to be a public company, but will make being public attractive again."

The proposal is also intended to align the U.S. more closely with other major markets — including the UK, Japan, and Hong Kong — where semiannual reporting is already common.

What should public companies be thinking about?

For some mature operating companies with relatively stable and predictable business models, the proposal could offer meaningful flexibility by reducing formal reporting burdens and shifting management focus somewhat away from quarter-to-quarter reporting cycles. Whether those benefits are realized in practice, however, will likely depend on investor expectations, financing needs, and existing governance and disclosure practices.

Some key questions boards and management teams may want to consider include:

Will investors still expect quarterly information?

Even if the SEC no longer requires quarterly Form 10-Qs, analysts, institutional investors, lenders, and rating agencies may still expect quarterly earnings releases, guidance updates, and investor calls. Companies considering semiannual reporting will need to evaluate whether investors would view the change as a sensible efficiency measure — or as a reduction in transparency.

There will also be a signaling question, particularly for early adopters. Companies may need to clearly articulate why a shift to semiannual reporting benefits investors and supports long-term strategy, rather than simply reducing compliance costs.

Would semiannual reporting actually reduce costs and workload?

Some companies could decide to leave internal quarterly processes largely in place. Disclosure committees, quarterly close procedures, management certifications, audit committee reviews, earnings releases, Regulation FD controls, and insider trading compliance processes may still need to operate on a quarterly cadence even without a Form 10-Q filing requirement. If that is the case, the actual savings from moving to Form 10-S would be more modest than initially expected.

How would this proposal affect capital markets activity?

Companies that regularly access the capital markets may face additional complexity under a semiannual reporting model. Offerings, shelf takedowns, comfort letters, at-the-market offerings, and M&A transactions often depend on current quarterly financial information. While the SEC’s proposal attempts to address financial statement staleness rules, market practice and auditor requirements may continue to drive demand for quarterly reviewed financials.

Are there governance, disclosure, or litigation implications?

Form 10-Q currently serves as the principal vehicle for updating investors on litigation, liquidity, risk factors, and other material developments that may not otherwise trigger Form 8-K disclosure obligations. With longer gaps between periodic reports, companies may need to decide whether to provide more robust interim disclosures voluntarily through earnings releases or Form 8-Ks.

Companies should also consider whether less frequent formal reporting could extend blackout windows and quiet periods; increase risks related to disclosure requirements (i.e., Regulation FD); create pressure for more discretionary disclosure decisions by management; or increase stock volatility and related litigation risk around semiannual reporting periods.

Do existing contracts assume quarterly reporting?

Many credit agreements, indentures, joint venture arrangements, and other commercial agreements rely on quarterly financial reporting and covenant calculations. Companies considering semiannual reporting should identify contractual provisions tied to quarterly financial statements and assess whether amendments, waivers, or supplemental reporting obligations would be required.

Is semiannual reporting a good fit for the company’s business model?

The proposal may be more attractive for companies with relatively stable operations; limited capital markets activity; and business models less dependent on quarter-to-quarter performance metrics. By contrast, companies in highly dynamic sectors — or companies with significant seasonality, volatile earnings patterns, or active investor engagement — may conclude that quarterly reporting remains strategically preferable.

As an example, the SEC itself specifically identified prerevenue biotechnology issuers as potential beneficiaries of the proposal because those companies often trade more on regulatory and clinical milestones than on quarterly financial performance.

What to watch for next

The SEC’s comment period runs through July 6, 2026, and the final rules could evolve significantly before adoption.

The public comment record remains relatively limited and preliminary, but early feedback reflects a familiar divide between issuer flexibility and investor transparency concerns. Supporters argue the proposal could reduce short-termism and compliance burdens while making U.S. public markets more attractive; opponents contend that less frequent reporting could weaken transparency, increase information asymmetry, and reduce market discipline. To date, relatively few large public companies appear to have submitted formal comment letters, though issuer-side advisors and practitioners have generally viewed the proposal favorably, particularly for companies with stable operations or limited capital markets activity.

Under the assumption that some version of this proposal will ultimately be adopted by the SEC, in the near term, companies may want to:

·       assess whether semiannual reporting would meaningfully change current reporting practices;

·       inventory contracts and financing arrangements tied to quarterly reporting;

·       evaluate likely investor and analyst reactions;

·       discuss implications with your audit committee, auditors, underwriters, and lenders; and

·       consider whether to participate in the SEC comment process.

The proposal raises a broader strategic question for established public companies: whether quarterly SEC reporting remains necessary to support effective market transparency and investor engagement, or whether the company could maintain investor confidence with a more flexible reporting framework supplemented by targeted quarterly communications.

For many companies, the answer may ultimately turn less on legal requirements and more on practical considerations — including investor expectations, capital markets activity, governance preferences, and the extent to which the company believes reduced formal reporting could support a longer-term management and investor focus.

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Diego T. Ruiz is Head of U.S. Government Relations atStillpoint. He served as Chief Operating Officer of the Securities and Exchange Commission in the Bush and Obama Administrations.

diego.ruiz@stillpointglobaladvisors.com

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