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Today, one of the most efficient, if not the most efficient, way for publicly-held companies to relay earnings information is via an earnings conference call. Most companies hold four so-called "earning calls" a year. Investors call in to a special number and get to hear management’s take on earnings that quarter. Analysts also participate, looking for signals of future performance.
A typical earnings conference call has a facilitator, a sort of emcee who keeps the ball rolling. It’s a good bet the Chairman will be participating along with the CEO, CFO, and other executives. These are important events. An earnings conference call can affect perceptions about a stock’s prospects very easily. There’s plenty of spin—and usually a Q&A period where investors as well as analysts get to pose questions.
The typical earnings conference call lasts about an hour. Calls are usually recorded and kept so that people unable to make the scheduled call can call in at their leisure and listen to a replay. Capitalism with the accent on convenience.
Like any event conference call an earnings conference call requires planning, organization, professional facilitation and follow-up. If you’re considering a conference call for your next quarterly report, make sure you research the following:
- Cost. Most teleconferencing companies today are willing to offer so-called "wholesale" rates for large volume users. Ask about rates. They vary and not always in proportion to quality of service.
- Support. A good company will provide a dedicated event coordinator for your earnings call. Dealing with a single source can make a big difference.
- Technical expertise. Make sure you have a dedicated event operator on your earnings call for the full duration of the call in case problems arise. And make sure you have a direct, private line to the operator. You don’t need what you’re saying to go out over the entire call.
Given the critical role that earning conference calls play on Wall Street every facet needs to be executed flawlessly. Little details—should you have music for waiting participants or not—can affect the entire mood of the event for people calling in. You may want a recorded announcement to play periodically. And you’ll want a conference specialist who will professionally introduce the meeting, provide concise instructions for participants and then disappear until needed again.
Not every conference call provider has the special expertise necessary to pull off an earnings conference call with the degree of professionalism such as A + Conferencing provides. Make sure to do your homework when searching for a provider. The ramifications of a badly executed earnings call are problems you can certainly do without.
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