Seasonality

A pattern in a time series that repeats in a regular way — for example, daily average temperatures rise each summer.

A characteristic of a time series in which the data experiences regular and predictable changes which recur every calendar year. Any predictable change or pattern in a time series that recurs or repeats over a one-year period can be said to be seasonal.

Note that seasonal effects are different from cyclical effects, as seasonal cycles are contained within one calendar year, while cyclical effects (such as boosted sales due to low unemployment rates) can span time periods shorter or longer than one calendar year.

Investopedia Says:
Seasonality can be seen in many time series, and it's more common than you might think. For example, if you live in a climate with cold winters and warm summers, your home's heating costs probably rise in the winter and fall in the summer. You would reasonably expect the seasonality of your heating costs to recur every year. Similarly, a company that sells sunscreen and tanning products would see sales jump up in the summer, but drop in the winter. Companies that understand the seasonality of their business can time inventories, staffing and other decisions to coincide with the expected seasonality.

It's important to remember the effects of seasonality when analyzing stocks from a fundamental point of view. For example, if you assumed a sunscreen company was going to earn as much in the next three quarters as it did during the recent summer quarter, your earnings estimates would likely be way off the mark!

Related Links:
We show you how to take advantage of periodic trends in the equity markets. Capitalizing On Seasonal Effects
This strategy can be profitable but requires careful timing and analysis of various factors. Find out what they are. The Ups And Downs Of Investing In Cyclical Stocks
Investing during an economic downturn simply means changing your focus. Discover the benefits of defensive stocks. Cyclical Versus Non-Cyclical Stocks

Variations in business or economic activity that recur with regularity as the result of changes in climate, holidays, and vacations. The retail toy business, with its steep sales buildup between Thanksgiving and Christmas and pronounced dropoff thereafter, is an example of seasonality in a dramatic form, though nearly all businesses have some degree of seasonal variation. It is often necessary to make allowances for seasonality when interpreting or projecting financial or economic data, a process economists call seasonal adjustment.

Characteristic of a market, product, or promotion that shows a pattern of variation with changes in seasons. For example, in northern states the hot chocolate market is most active in winter and relatively inactive in summer. Most magazine promotions achieve their highest response rate during the Christmas buying season, because many people give subscriptions as Christmas gifts. Certain mailing lists also perform better at different times of year. A mailing to residents of large cities will not do well in July or August, because many people leave the city for vacation or for weekends.