Vocal Delivery Quality in Earnings Conference Calls

82 Pages Posted: 27 Mar 2023 Last revised: 3 Jun 2024

See all articles by Bok Baik

Bok Baik

Seoul National University

Alex Kim

University of Chicago Booth School of Business

David S. Kim

Massachusetts Institute of Technology (MIT) - Sloan School of Management

Sangwon Yoon

Seoul National University

Date Written: June 03, 2024

Abstract

We study the economic consequences of managers' vocal delivery quality during earnings conference calls. We introduce a novel measure, vocal delivery quality, that captures the acoustic comprehensibility of audio information for an average listener. Our measure relies on a deep-learning algorithm applied to a large sample of earnings call audio files. Consistent with predictions from the psychology and accounting literatures, we find evidence that the quality of managers' vocal delivery deteriorates when they deliver negative news, such as a decrease in earnings or negative narrative information, and positive but transitory earnings news. We show that the stock market reacts in real time to managers' vocal delivery quality. We also document that the vocal delivery quality has an effect on information intermediaries such as analysts and the media. Overall, our findings underscore the role of vocal dimensions in corporate oral disclosures.

Keywords: Earnings conference call, vocal delivery quality, oral disclosures, audio disclosures, information processing costs, acoustic comprehensibility JEL Codes: G14

JEL Classification: G14, G41, M41

Suggested Citation

Baik, Bok and Kim, Alex G. and Kim, David and Yoon, Sangwon, Vocal Delivery Quality in Earnings Conference Calls (June 03, 2024). Chicago Booth Research Paper No. 23-21, Fama-Miller Working Paper, Available at SSRN: https://ssrn.com/abstract=4398495 or http://dx.doi.org/10.2139/ssrn.4398495

Bok Baik

Seoul National University ( email )

Seoul
Kwanak-gu
Seoul, 151-742
Korea, Republic of (South Korea)

Alex G. Kim (Contact Author)

University of Chicago Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States

David Kim

Massachusetts Institute of Technology (MIT) - Sloan School of Management ( email )

Sangwon Yoon

Seoul National University ( email )

Kwanak-gu
Seoul, 151-742
Korea, Republic of (South Korea)

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