Home > Communication, Production > A Tale of Two Earnings Calls

A Tale of Two Earnings Calls

So last week I sat in on the Yahoo 2Q results call and on the whole I was underwhelmed – the performance was lacking and more importantly for me the technology effort was poor. I jumped on the Netflix earnings call yesterday to compare the two attempts. No contest – the technical delivery and overall performance of the Netflix show absolutely blew away Yahoo. Delivery was smooth, the presenters came across as comfortable and prepared for the video experience. The one exception was the camera quality – Yahoo used professional grade cameras, Netflix chose webcams, and that’s a big negative in my view. If you’re a professional company, invest a little time and money in a camera crew for your CEO & CFO to improve the lighting and delivery.

All of this is technical – as a web-delivered video broadcast, I thought this worked very well. Leveraging Google Hangout as a delivery system meant a rock solid platform ensuring a technically successful show (aside from my capture-device issues). Again, the executives were much better prepared for their roles and came across far better than the Yahoo team last week. Others reviewed the experience, and here’s what they thought, along with my commentary:

I think part of the problem here is that these stories are looking at this through a lens different than the target audience. I suspect most in the intended audience didn’t care in the slightest that the production values were lower than they should be. If I had to guess, many of the analysts were listening, not watching – multi-tasking as they had the call on in the background, and they may never have noticed the webcams. I doubt, contra Buzzfeed, that this was more confusing for the target audience – they know what they’re listening for, and I’m quite convinced they know if they heard the positive or negative information they need to tease out a recommendation for investors.

This is the only thing I think that really matters, and plays into my first and most critical rule of video – know thy audience. How did the analyst community react to a very, very different format? Traditionally as I understand it these audio calls allow for analysts to raise any question they like directly to the executive team – I find it hard to believe they were completely comfortable with the moderator role played by the two selected journalists. I suspect, though I can’t prove it, that many in the analyst audience felt the entire exercise was more staged than a traditional call. Not that the moderators were in the tank with Netflix, but that the traditional give and take was restricted by the moderated format.

This is a very important consideration for companies looking at a video earnings call – you have a relationship with your analysts as established by your current earnings delivery mechanism. What might change about it if you switch to a video format? Are you looking to blow up your old model as Netflix did, or combine traditional with video as Yahoo did? Are you prepared to be on camera where your body language and setting will influence how the analysts view your presentation and responses to questions?

What matters to these companies when dealing with earnings is putting the best face on their results so the stock valuation and company outlook are as positive as possible. If you look to change your earnings call to video, the goal for an executive team and the video group has to be to aid the process for the analysts who impact your company’s future.

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