The report uses the date range and reports on the corresponding date range for the previous year.

See below for examples:
  1. Date range LESS than a year: (i.e. 06/01/2000 - 12/31/2000)
    The report includes donors who gave between 06/01/1999 - 12/31/1999 , but not between 06/01/2000 - 12/31/2000.
     
  2. Date range EQUAL to a year: (i.e. 01/01/2000 - 12/31/2000)
    The report includes donors who gave between 01/01/1999 - 12/31/1999 but did not donate between 01/01/2000 - 12/31/2000.
     
  3. Date range MORE than a year: (i.e. 6/1/1994 – 12/31/1995)
    The report will include donors who gave between 6/1/1993 to 5/31/1994 (365 days prior to the start date), but not between 6/1/1994-12/31/1995. 
If the end goal is to see donors who did not give during a date range that is less than a year, but did give during a date range of a full year previously, create a query with criteria needed. 
For Example:

Total Number of Gifts_1 = 0
Filter: Gift Date between 10/1/2014 and 4/6/2015
AND Gift Type one of Cash, Pay-Cash, MG Pay-Cash, Pledge, Stock/Property, MG Pledge
AND
Total Number of Gifts_2 greater than or equal to 1
Filter: Gift Date between 10/1/2013-9/30/2014
AND Gift Type one of Cash, Pay-Cash, MG Pay-Cash, Pledge, Stock/Property, MG Pledge