Everything you need to know about Earning calls

The earnings call is an important source of information about a company's business. In the call, management provides quarterly updates of the company results. Business analysts and investors join this call to get the latest updates and ask any questions related to the business.

Everything you need to know about Earning calls
What is an earnings call?

Also known as Conference call, Concall, Analyst call, Investor meet

You might be wondering what are earnings calls? Take a look at the earnings call transcript of TCS here. We will take this as a reference to understand the earning calls.

The first thing you may notice in the earnings call is the Moderator. They are the people moderating the call. There are other participants as well in the earnings call.

Participants of an earnings call

Moderator: They are the people moderating the call. They provide general instruction on how to proceed during the call.

Management: These are the people who represent the company. As we can notice from the TCS earnings call, Mr. Kedar Shirali – Global Head, Investor Relations at TCS, introduces the leadership team containing Mr. Rajesh Gopinathan – CEO & MD, Mr. NG Subramaniam – COO, Mr. V Ramakrishnan – CFO, and Mr. Milind Lakkad – Chief Human Resources Officer.

Other participants: These are the people who are interested in the business. They are generally business analysts, institutional & retail investors. They can ask questions to management during the call.

Proceedings of the call

An earnings call starts with the Moderator providing general instructions. The call is followed by a person from management who introduces management people joining the call. Subsequently, earning results for that quarter are discussed. The management generally compares the financial numbers like revenue, operating margin, net profit, etc with the previous quarter and previous years' quarter. At last, the floor is open to the question and answer session for the participants. Q&A session comprises a large portion of the call.

What kind of questions are asked in an earning call?

Participants are free to ask questions related to the business like upcoming events, new product launches, the outlook of the sector, etc. The management provides answers best to their knowledge. These statements are forward-looking and might not materialize in the future.

How can you join an earnings call?

Companies generally intimate about the upcoming earning call via stock exchange filings. Check Agro Tech Foods Limited filing here.

Intimation regarding Board Meeting for Unaudited Financial Results, and Schedule of Analyst Call, Agro Tech Foods Limited

Indian companies restrict such calls to their investors only[1]. Companies inform the investors about the details of the call, typically over email. However, it is not always possible to join the earnings call due to time constraints. In such cases, you can go through the earning call transcripts to catch up on the details.

How can you access the earnings call transcripts?

Earnings calls are generally available under the Investor Relation head of the corporate website. Some companies also provide the transcripts to stock exchanges via corporate filing. But finding trancripts via these mediums are cumbersome. Captwist provides a comprehensive database of earnings call transcripts of Indian companies with analysis. You can also search through all the available transcripts for interesting insights.

How often do the earning calls happen?

Earnings calls are scheduled after the quarterly result is out and occur four times a year.

Why are earnings calls important?

Earnings calls tend to include robust financial data and other insights that might factor in an investor's decision-making process. Earnings calls are so important that they may have an immediate impact on the stock prices of the company.

[1] Report on disclosures pertaining to analyst meets, investor meets, and conference calls, page 7