Battling Uncertainty: Corporate Disclosures of COVID-19 in Earnings Conference Calls and Annual Reports

73 Pages Posted: 29 Apr 2020 Last revised: 1 May 2020

See all articles by Victor Xiaoqi Wang

Victor Xiaoqi Wang

California State University, Long Beach

Betty (Bin) Xing

Baylor University

Date Written: April 28, 2020


This study examines the informativeness of firm disclosures related to COVID-19 in earnings conference calls and annual reports (10-K) during the first quarter of 2020 when firms face tremendous uncertainty and little regulatory guidance. We find that investors react to COVID-19 related discussions made during the presentation of the conference calls but not to those during the Q&A session. We further find that managers’ tone does not provide information incremental to the COVID-19 discussions. This finding suggests that investors fixate their attention on the overwhelming event and ignore the sentiment signals from firm managers. In our determinants model, we find that the extent of COVID-19 related discussions largely depends on industry membership and time effects, and does not depend on performance and firm characteristics. In our analysis using 10-Ks, we find that COVID-19 related disclosures are associated with short-term abnormal returns, suggesting that these disclosures are informative to the equity market. More interestingly, we find that risk disclosures in the Risk Factor Disclosure (RFD) section in the 10-K do not trigger any short-term market reactions after we exclude the COVID-19 related disclosures, again suggesting that disclosures about the overwhelming event COVID-19 crowd out investors’ attention on other risk information. Finally, we find a negative market reaction to firms that apply for the SEC’s extension on filing deadlines, even though the relief was specifically granted for COVID-19, suggesting that the market generally interprets late filings as negative events, even in scenarios outside of the firms’ control.

Keywords: Coronavirus, COVID-19, Corporate disclosures, SEC’s filing relief, Risk disclosures, Earnings conference calls, 10-K filings, Market reactions, Event studies, Sentiment analysis, Textual analysis

JEL Classification: M41, G14, G18

Suggested Citation

Wang, Victor Xiaoqi and Xing, Betty (Bin), Battling Uncertainty: Corporate Disclosures of COVID-19 in Earnings Conference Calls and Annual Reports (April 28, 2020). Available at SSRN: or

Victor Xiaoqi Wang (Contact Author)

California State University, Long Beach ( email )

1250 Bellflower Blvd
Long Beach, CA 90840
United States

Betty (Bin) Xing

Baylor University ( email )

1 Bear Pl # 78002
Waco, TX Texas 76798-0006
United States
5195909329 (Phone)

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