By Jessica DiNapoli April 7, 2015
Last year, the Associated Press started using robots to write earnings stories, long the meat and potatoes of many business journalists. But the AP’s move doesn’t mean earnings season is off limits for real live journalists.
For one thing, Seeking Alpha recently warned that some of these formulaic automated reports, about 3,000 of which are published each quarter, may not provide a complete or even accurate picture of a company’s earnings. What’s more, the best business journalists have always dug into balance sheets and income statements to find more meaningful stories about where the business is headed, what challenges it is facing, or what its results say about the industry to which it belongs or the economy at large.
At the time of the move, the company said as much itself. AP managing editor Lou Ferrara told Mashable that the robot reports would give journalists more time for earnings stories that provide context and for investigative pieces. “Instead, our journalists will focus on reporting and writing stories about what the numbers mean and what gets said in earnings calls on the day of the release, identifying trends and finding exclusive stories we can publish at the time of the earnings reports,” he said.
With first quarter reports already trickling in, here are few tips for business journalists wanting to make the most of earnings season.
Pay attention to boasting: In February, Elon Musk made headlines for a big statement about Tesla’s bright future: that its market capitalization would rival Apple’s in 10 years. Musk made the statement on the company’s earnings conference call in response to a question about infrastructure spending, and news organizations pounced. Reporters listening in on the call, held at 7:30 p.m. eastern time, got the scoop. Here’s one story about Musk’s claim in Marketwatch.
Offer context and comparison: Company executives may not name names when it comes to their competitors, but you need to know who they are and how they fared to really understand the company you are writing about. Did falling consumer demand hurt quarterly sales for all of the companies in an industry, or did one fare better than the rest and if so, why? On Feb. 24, Macy’s announced earnings for its quarter ended Jan. 31. The following day, CNBC published an in-depth story on how Macy’s plans to expand into outlet-style stores, news gleaned from the conference call. The CNBC reporter compared Macy’s plans to those of Nordstrom and T.J. Maxx.
Stories on company earnings do not have to be all about profit, revenue and earnings per share. Reporters can pick through the numbers to find big changes in company operations, or discover a hint about real news happening on their beat. These are skills that, at least for now, a robot can’t beat.
This entry was posted on Tuesday, April 7th, 2015 at 12:36 pm. It is filed under Skills and Tradecraft and tagged with earnings reporting, earnings season, robot journalism. You can follow any responses to this entry through the RSS 2.0 feed.
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