IDEAS home Printed from https://ideas.repec.org/a/ecb/ecbbox/202300042.html
   My bibliography  Save this article

Earnings calls: new evidence on corporate profits, investment and financing conditions

Author

Listed:
  • Andersson, Malin
  • Neves, Pedro
  • Nunes, Carolina

Abstract

This box analyses sentiment indices of profits and investment that have been compiled from a new data source, namely earnings call transcripts of listed euro area firms. It shows that these data series have correlated well with standard investment and profit series over the past two decades. It also demonstrates that profit sentiment has improved since the third quarter of 2021, while corporate investment sentiment rose slightly further in the second quarter of 2023, despite tightening financing conditions. At the sectoral level, profit sentiment in the services and utilities sectors has held up better than it has in the manufacturing sector since last year. In addition, an indicator of financial risk extracted from the earnings call data shows that firms are highly concerned about rising financing costs and perceive tighter financing conditions as a clear risk. JEL Classification: E22, E30, E32

Suggested Citation

  • Andersson, Malin & Neves, Pedro & Nunes, Carolina, 2023. "Earnings calls: new evidence on corporate profits, investment and financing conditions," Economic Bulletin Boxes, European Central Bank, vol. 4.
    • Handle: RePEc:ecb:ecbbox:2023:0004:2
    Note: 427284
    as

    Download full text from publisher

    File URL: https://www.ecb.europa.eu//pub/economic-bulletin/focus/2023/html/ecb.ebbox202304_02~40e3556f39.en.html
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    financing conditions; Investment; profits;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ecb:ecbbox:2023:0004:2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Official Publications (email available below). General contact details of provider: https://edirc.repec.org/data/emieude.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.