Earnings Call

Earnings calls usually take place shortly after a company publishes its quarterly or annual results. They typically begin with prepared remarks from the chief executive and chief financial officer, covering performance, strategy and outlook, followed by questions from analysts.

For example, after a retailer reports lower profits than expected, analysts on the earnings call might ask about falling customer numbers, discounting and how management plans to respond.

Earnings calls give investors insight beyond the numbers, including management’s tone, explanations for results and expectations for future performance, often called guidance. Share prices can move significantly during or after calls, depending on what is said.

Calls are usually open to the public through webcasts, and transcripts are widely available. Regulations in many countries require companies to share material information with all investors at the same time, rather than privately with selected analysts. Increasingly, analysts use language analysis tools to examine executives’ choice of words and tone for signals about the business.