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GAAP vs non-GAAP

GAAP follows standard US accounting rules; non-GAAP adjusts those results.

FundamentalsIntermediate

Definition

Generally Accepted Accounting Principles set one consistent way of reporting. Companies often also publish adjusted, or non-GAAP, figures that exclude items like stock compensation or one-time costs, which they say show underlying performance.

Watch out for

Exclusions are chosen by management. Compare both and read the reconciliation.

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