What are earnings calls?

Cheat Sheet:

  • The earnings call is when a CEO explains the earnings report and what to expect for next quarter.
  • Companies use the call to highlight successes or calm fears, depending on the situation.
  • They answer questions from investors and analysts.

When companies announce earnings, they conduct an earnings call where the CFO and/or CEO explains why earnings came out the way they did and what to expect for the next quarter.  They also answer questions on the call from investors and analysts. Remember, the analysts are already trying to make predictions for the next quarter!

Earnings calls used to be done over a conference call with a dial-in number. Nowadays they’re done over a webcast. Anyone can listen in. They’re held outside market hours, so everyone has time to react to what’s said on the call.

Here’s the audio from an Apple earnings call in 2011. Steve Jobs usually got other people on his executive team to deal with earnings calls, but he did this one because he wanted everyone to know how pissed off he was about Google’s coming out with Android to compete with iPhone.  https://www.youtube.com/watch?v=XYfFWdRFEZI

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