'annualize' originates from Latin-derived English elements: 'annual' (from Latin 'annuus' meaning 'yearly') plus the verb-forming suffix '-ize' (via Greek '-izein'/'-izo'), used in English to form verbs meaning 'to make or to become'.

'annualize' was formed in modern English by adding the productive suffix '-ize' to 'annual' (itself from Latin 'annus'/'annuus'), producing the verb meaning 'make annual' or 'express as a year rate'; the sense of converting figures to a yearly basis developed with financial and statistical usage in the 19th and 20th centuries.

Initially it meant 'to make annual' or 'to cause to occur yearly'; over time it broadened in financial and statistical contexts to mean 'to convert or express a figure as a yearly rate (annualize a rate)'.