Where are they now? 78% companies with off-trend Q1 2023 earnings dates performed as our data indicated

During the Q1 2023 earnings season we profiled 9 companies that had unusual earnings dates, which can serve as a foreshadowing of what an upcoming report might reveal, and therefore be an indicator of corporate financial health. Seven of those companies' stocks reacted as we expected, using the Wall Street Horizon DateBreaks Factor logic.* Below we review all nine names and how they performed in the 3-day post-earnings drift following their announcement.

First Republic Bank (FRC) - Followed Expected Logic
Company Confirmed Report Date: Monday, April 24, AMC
Projected Report Date (based on historical data): Thursday, April 13, BMO
DateBreaks Factor: -3*

First Republic crossed our radar ahead of their Q1 report with a confirmed earnings date that was outside of their historical range. On Friday, April 7, First Republic Bank (FRC) announced they would report Q1 2023 earnings on April 24 after market close. That was 11 days later than expected, as well as the first Monday report ever and the first after-the-bell report ever. 

Considering the whirlwind of the regional banking contagion in Q1, this move to delay earnings seemed to confirm that FRC was preparing to share bad news with investors on its earnings call. The 14th largest regional bank in the United States was one of the focal points of the banking crisis. After the collapse of Silicon Valley Bank provoked panicked withdrawals from various regional banks, JPMorgan Chase along with 10 other large banks bailed out First Republic with $30B in backstop funds in March. Ultimately the bank was seized by regulators and sold to JPM on May 1. The New York Stock Exchange has since delisted shares of the bank which is now only tradeable via ticker FRCB over-the-counter (OTC). 

Results: 
While First Republic ended up beating both EPS (actual: $1.23, est: $0.85**) and revenue expectations (actual: $1.21B, est: $1.15B**), it was the massive outflow of deposits that had investors worried. FRC reported that deposits had fallen 40% to $104.5B in Q1, vs. estimates that they would settle at $145B. As a result, the stock fell a whopping 61%*** in the 3 days following the announcement.

Spotify Technology (SPOT) - Followed Expected Logic
Company Confirmed Report Date: Tuesday, April 25, BMO
Projected Report Date (based on historical data): Wednesday, April 26, BMO
DateBreaks Factor: 2*

Spotify reported Q1 results just a day earlier than anticipated, deviating from a long-term trend of reporting Q1 results on a Wednesday in the 18th week of the year, with this being the first Tuesday report during the 17th week of the year. 

Results: 
After reporting missed earnings (actual: -$1.24, est: -$0.86**) and revenue (actual: $3.27B, est: $3.39B**) expectations, Spotify’s stock initially traded lower. However, it was news of major cost cutting efforts coupled with the largest-ever Q1 jump in monthly active users that ultimately caught investors’ attention. The stock closed up 5% that day, but settled at a 0.5%*** gain by day 3. 

PacWest Bancorp (PACW) - Followed Expected Logic
Company Confirmed Report Date: Tuesday, April 25, AMC
Projected Report Date (based on historical data): Thursday, April 20
DateBreaks Factor: -3*

Another mid-sized, west coast bank, PacWest Bancorp, delayed their earnings date for Q1 in the midst of the regional banking crisis. On March 31, PACW confirmed they would report Q1 financial results on Tuesday, April 25, a week later than usual. Just a week prior to confirming their Q1 earnings date, PACW provided a rather sobering update to investors which detailed how customers had withdrawn 20% of their deposits YTD, as well as information around its $1.4B capital raise from Atlas SP Partners. 

Results: 
PacWest initially saw shares jump after reporting it had seen deposit inflows towards the end of Q1 and beginning of Q2. While deposits fell more than 16% to $28.2B in Q1, from March 20 - April 25 the bank added roughly $1.8B in deposits. That announcement led investors to lift the stock 15% after the report, but in the 3-day post earnings drift the price fell just slightly by 1.5%.*** However on May 4 the picture appeared much less rosy when PAWC revealed they were considering “all options,” including a possible sale, at which point the stock hit an all-time intra-day low of $2.48. 

Roku Inc. (ROKU) - Followed Expected Logic
Company Confirmed Report Date: Wednesday, April 26, AMC
Projected Report Date (based on historical data): Thursday, April 27, AMC
DateBreaks Factor: 2*

Similar to Spotify, Roku reported Q1 results just a day ahead of the expected schedule. Roku typically reports first quarter results during the 18th or 19th week of the year, making this notably earlier than past years at week 17. While they used to report during the first week of May, last year Roku moved their Q1 date to the end of April. On the management front, this was Steve Louden’s last earnings season as CFO of Roku. Dan Jedda, formerly CFO of Stitchfix, filled the role on May 1.

Results:
Roku beat both on the top (actual: $741M, est: $708M**) and bottom-line (actual: -$1.38, est: -$1.47**) in Q1, but that wasn’t the only good news. The streaming service gained 1.6M streaming customers during the quarter, beating analyst estimates for 1.14M. Total hours streamed were up 20% YoY, which led to a record high of 3.9 streaming hours per active account per day. Despite the better-than-expected results, Roku’s mention of a “challenged” macroeconomic environment tempered the stock’s price increase to only 0.2%*** over the 3-day post-earnings period. 

Marriott International (MAR) - Followed Expected Logic
Company Confirmed Report Date: Tuesday, May 2, BMO
Projected Report Date (based on historical data): Thursday, May 4, BMO
DateBreaks Factor: 2*

Marriott reported Q1 2023 results on Tuesday, May 2. While this was only two days earlier than anticipated, it pushed MAR’s Q1 report date into the 18th week of the year, rather than the long-term trend of reporting during the 19th or 20th week of the year.

Results:
When Marriott reported on May 2nd, they blew sell-side expectations out of the water. EPS came in at $2.09 vs. the expected $1.85 and revenues topped out at $5.6B vs. the consensus estimate of $5.45B. The company also raised full-year guidance on account of strong demand in the upcoming summer travel season. As a result the stock increased 3.7%*** in the three days following the report. 

PerkinElmer (PKI) (now Revvity (RVTY)) - Followed Expected Logic
Company Confirmed Report Date: Thursday, May 11, BMO
Projected Report Date (based on historical data): Tuesday, May 2, BMO
DateBreaks Factor: -2*

PerkinElmer confirmed a Q1 2023 earnings date of Thursday, May 11, nine days later than anticipated and the latest-ever Q1 report. Prior to the Q1 results, PKI had reported negative earnings growth from Q4 2021 - Q4 2022, and either negative or flat revenue growth over the same time period.

Results:
When PerkinElmer reported on May 11, they narrowly beat EPS expectations (actual: $1.01, est: $1.00**)  and missed revenue estimates (actual: $675M, est: $679M**). Just two days prior, PKI revealed their new name and ticker after selling off three business units (applied, food, and enterprise services) to private equity firm New Mountain capital last August. Their remaining diagnostics and life sciences businesses will continue on as Revvity (RVTY). In the three days following their earnings report, Revvity’s stock fell 7.5%.*** 

Air Canada (CA:AC) - Followed Reverse Logic
Company Confirmed Report Date: Friday, May 12, BMO
Projected Report Date (based on historical data): Tuesday, April 25, BMO
DateBreaks Factor: -2*

Air Canada reported Q1 2023 results on Friday, May 12, over two weeks later than expected. Despite positive results from other airlines during the quarter and updated guidance from Air Canada on May 4 which pointed to a recovery in the second-half of 2023 , this heavily-delayed earnings date set off some red flags. 

Results:
By all accounts, Air Canada went on to report a superb first quarter. Passenger revenues more than doubled over the year-ago period, to a first quarter record of $4.1B and cost per available seat mile (CASM) fell 7% over the same time period. As such the stock increased nearly 3%*** in the three days following the report. 

Boohoo Group (BHOOY) - Followed Reverse Logic
Company Confirmed Report Date: Tuesday, May 16, Unspecified
Projected Report Date (based on historical data): Wednesday, May 3
DateBreaks Factor: -3*

The Gen Z fashion brand beloved by TikTokers, Boohoo Group, reported FY and H2 2023 results on May 16, nearly two weeks later than expected. The delayed earnings date plus dismal guidance in their H1 2023 release which warned that full year sales would fall 10% on account of a worsening macro-economic and consumer backdrop, appeared to be a signal that bad news was coming on the earnings call. 

Results:
When Boohoo reported results on May 16, full year revenues (for the 12 months ending on February 28, 2023) came in 11% lower on a YoY basis, but up 43% from 2020. Despite the YoY loss, investors seemed to react to CEO John Lyttle’s confidence that current priorities such as cost cutting, price increases, investments in automation and local fulfillment would pave a “clear path to improved profitability” and “double-digit revenue growth.” Based on this promise the stock rose nearly 15%*** in the three days following the report. 

New Relic, Inc (NEWR) - Followed Expected Logic
Company Confirmed Report Date: Tuesday, May 23, AMC
Projected Report Date (based on historical data): Thursday, May 11
DateBreaks Factor: -3*

For the past eight years, New Relic has reported their fiscal Q4 results between May 8 - 14, on a Tuesday or Thursday. This year they bucked the trend by releasing results nearly two weeks later on May 23, their latest earnings report date in the 18 years we’ve tracked them. 

Results:
When New Relic reported on May 23, they significantly beat EPS expectations (actual: $0.42, est: $0.22**) and slightly beat on revenues (actual: $242.5M, est: $241.1M**). However, it was guidance for the coming quarter and fiscal year that fell short of expectations and disappointed investors. For FQ1 2024 NEWR forecasted revenue between $238M - $240M (below Wall Street estimates of $251M) and full-year revenue of $1.02B - $1.03B (below expectations for $1.07B). As a result the stock fell 6.3%*** in the three days following the announcement. 

The Bottom Line

Tracking earnings date delays and advancements can give investors clues about how a company will perform after an earnings announcement, especially when used in conjunction with other bespoke data sets. Tune in for Q2 2023 earnings season, which begins with reports from the big banks on July 14, to see which companies are sending signals to the markets through earnings date changes. 

* Wall Street Horizon DateBreaks Factor: statistical measurement of how an earnings date (confirmed or revised) compares to the reporting company's 5-year trend for the same quarter. Negative means the earnings date is confirmed to be later than historical average while Positive is earlier.

**EPS and Revenue estimates provided by FactSet

*** Price change based on the delta between the close before the report and the close three days after the report.