Managers' use of humor on public earnings conference calls

• 成果类型: Article
• 署名作者: Call, Andrew C.; Flam, Rachel W.; Lee, Joshua A.; Sharp, Nathan Y.
• 署名单位: Arizona State University; Arizona State University-Tempe; University of London; London Business School; Brigham Young University; Texas A&M University System; Texas A&M University College Station
• 刊物名称: REVIEW OF ACCOUNTING STUDIES
• ISSN/ISSBN: 1380-6653
• DOI: 10.1007/s11142-023-09764-x
• 发表日期: 2024
• 页码: 2650-2687
• 关键词: buy-side analysts; FORECAST REVISIONS; access; determinants; leadership

摘要

Despite the prevalence and importance of humor in interpersonal communication, the disclosure literature is silent on the use of humor in the context of corporate communication. Using a sophisticated machine learning algorithm, we identify managers' successful uses of humor during public earnings conference calls. When managers use humor on an earnings call, stock market returns and analyst forecast revisions following the call are more positive, primarily because of a muted response to negative earnings news. Consistent with managers' successful use of humor being a favorable signal of future firm performance, we find no evidence of a return reversal over the subsequent quarter, and managers' use of humor predicts more favorable news at the subsequent quarter's earnings announcement. Our study provides new evidence on the use of humor in corporate disclosures, and our findings indicate that humor can meaningfully influence the market response to public earnings conference calls.