3 Data driven tips to improve your next earnings realease
Earnings season is approaching!
Throughout earnings season, all eyes are on the latest company announcements that will move the market. But IR professionals know there’s a lot more going on behind the scenes to make sure their company’s earnings day goes off without a hitch.
One of the most important elements of earnings day reporting is preparing the release, or official announcement. The earnings release, at a high level, allows IR teams to share their company’s earnings story with the world. It also allows IR teams to set the stage and introduce a narrative for the earnings call to follow.
Like all elements of earnings season preparation, research plays a vital role in ensuring your announcement is communicated with a sense of consistency, relevancy, and transparency to the public, investors, and the press.
The earnings release is a chance for IR teams to distill and complement the lengthy, often complex quantitative legalese of the 10Q and regulatory reporting data with qualitative insights to drive company narrative and maintain control of messaging.
Here are some of Alpha's research tips for putting together a release that stands out from the crowd;
Make it accessible
Analysts and investors move quickly during earnings season. Some may have email alerts set up to track particular companies or keywords so that they’re instantly notified whenever new information is released.
Along with financial results, IR teams might highlight other company news that may not otherwise have warranted a standalone release. This could be a change in leadership, product announcement, or outlook on industry trends. Regardless, it’s important to make sure you’re capturing already short attention spans with the right information early on.
Optimising for mobile readability, and using charts or graphics can also make release data more accessible. With smart search tools like AlphaSense, analysts, journalists, and internal teams can quickly export tables to add to their own reports, making data collection easier for all parties.
Consistency in layout, design, imagery, and messaging makes the information easier to find for analysts and investors. Maintaining continuity within your earnings narrative also helps build trust for analysts who may be looking for shifts in company position, nuance changes in language, or granular insights buried in your release data.
Maintaining consistency in messaging means putting a microscope on the language you’ve used in prior earnings releases. When going through historical data, consider these questions:
What terms or keywords have you used before when describing company developments?
What broader trends have you or your competitors discussed before, and how are you approaching those topics now?
Like all companies know, not all news is good news when it comes to earnings. Just like having a consistent narrative, it’s important to maintain transparency when breaking bad news.
Look at historical examples of quarters where you may have underperformed. How have you responded in the past? How have your major competitors responded when they’ve missed their earnings targets? Use these insights to shape strategic quotes from company leadership to include in your release.
Earnings announcements can be a strategic way for companies to set the stage for earnings calls. By tapping into the right historical data, IR teams can build an announcement that is accessible to readers, and portrays their company in an authentic way.