In 2000, the U.S. Securities and Exchange Commission (SEC) introduced Regulation Fair Disclosure (or Regulation FD) which requires public companies to disclose material information to all investors simultaneously. To comply, public companies typically hold an earnings conference call following the release of their quarterly earnings. Other calls may be scheduled to announce a significant corporate event, such as an acquisition or divestiture. Investors are able to dial into these calls which usually start with the Chief Executive Officer and Chief Financial Officer presenting the results for the quarter, or announcing the event, and conclude with a question and answer session. Wall Street analysts ask direct questions to senior management who are on the call.

Financial data, earnings guidance for upcoming quarters and strategic initiatives are often presented on the conference call. Management’s presentation is carefully prepared by the company’s investor relations team. Analysts typically ask questions about management’s prepared remarks and/or pose unrelated questions.