What does accretive mean?
"Accretive" is an adjective describing growth that occurs through gradual accumulation — the slow, steady building-up of material, value, or advantage rather than sudden change. In geology and biology, an accretive process adds layers over time, as when coral reefs or sedimentary rock form. The word's most prominent modern use, however, is in finance, where a merger or acquisition is called accretive if it increases the acquiring company's earnings per share. In this context it is typically paired with the preposition "to," as in "accretive to earnings." The opposite of accretive is "dilutive," meaning a deal that reduces per-share earnings. Derived from the Latin verb "accrescere" (to grow), via "accretion," the word carries a neutral-to-positive connotation of patient, compounding gain. It belongs chiefly to formal registers — corporate reports, analyst commentary, and technical science writing — but its core idea of incremental buildup makes it precise and useful wherever gradual accumulation is the story.
adjectiveCharacterized by or relating to growth or increase by gradual accumulation; especially in finance, describing a transaction (such as an acquisition) that increases the acquiring company's earnings per share.
- Relating to growth or increase through gradual accumulation.
- (Finance) Of an acquisition or merger: increasing the acquirer's earnings per share.
"The acquisition proved accretive, lifting earnings per share within the first quarter."
"Coral reefs are accretive structures, built up layer by layer over millennia."
"Analysts viewed the buyback as immediately accretive to earnings per share."
In mergers-and-acquisitions slang, 'accretive' is the word every CEO wants attached to their deal — it literally means the takeover made shareholders richer.
Reviewed by Deb Chak, Editor. AI-assisted content curated by RJS Tech Solutions LLP.
Etymology of accretive
"Accretive" derives from the Latin "accretion-", the stem of "accretio" (a growing larger), itself from the verb "accrescere" (to grow, increase), formed from "ad-" (toward) plus "crescere" (to grow). English "accrete" and "accretion" come from the same root, as does "accrue," which entered English via Old French from Late Latin "accrescere." The Latin root "crescere" also underlies words such as "concrete" and "crescent."
Related word forms
How accretive is actually used
"Accretive" is largely formal and appears most often in financial and scientific writing. In finance it is almost always used with the preposition "to" (accretive to earnings). Its antonym "dilutive" is used in the same contexts.
Easily confused with accretive
Dilutive is the opposite of accretive: a dilutive transaction decreases a company's earnings per share, while an accretive one increases it.