What is Text Analytics?

Apple released a detailed update in its negative pre-announcement in early January, and that has been followed by a slew of cautious commentary on China throughout the technology sector.  We used our text analytics platform to look beyond the rehashed China discussion and uncovered 3 takeaways worth exploring.

Please note: This in no way represents investment advice. All transcript text provided by S&P Global Market Intelligence.

1. Putting 1Q in Context: Still an 8-Quarter Low

The market may be relieved by the absence of new negatives vs the negative pre-announcement, but Amenity’s NLP platform still flags Apple’s FY1Q earnings call as the most negative in the last 8 quarters.  The Amenity Score of the call was 30, roughly 50% below Apple’s 8-quarter average:

Amenity Score: Apple 8-Quarter Average

2. Some Discussion of iPhone Upgrade Challenges, but No Answers

China stole the headlines, but arguably the more systemic issue is the slowing pace of iPhone upgrades in the developed markets. The topic was addressed in Q&A, with acknowledgment that pricing is an issue and no specific plan for reversing the trend:

  • Apple (1/29/19):

"I do think that price is a factor. I think part of it is that, the FX piece. And then secondly, in some markets as I had talked about in my prepared remarks, the subsidy is probably the bigger of the issues in the developed markets."

"The average cycle has extended. There’s no doubt about that. We’ve said several times, I think, on this call and before that the upgrades for the quarter were less than we anticipated due to all the reasons that we had mentioned. So where it goes in the future, I don’t know."

3. Any Positives? Apple Wearables Momentum Mirrors Recent Fitbit Strength

Earnings calls are never one-sided, so we looked for the incremental positives from this otherwise disappointing quarter. Wearables stood out, with demand being strong enough that Apple is hitting supply constraints:

Sentiment Comparison: Wearables Commentary

What is the sentiment in the market around wearables? For a broader view we use Amenity Viewer's Query Insights feature and find consistently positive commentary on wearables this quarter:

Query Insights: Search Results for "Wearable"

Join the Amenity Viewer Beta Program today to analyze earnings call transcriptions and enable you to spot outliers, identify critical insights, and understand key drivers.

Transcript text provided by S&P Global Market Intelligence.

Copyright ©2019. All rights reserved.

September 18, 2019

Sentiment Analysis: Updated Regional Bank Uncertainty Ahead of Fed Rate Decision

We follow up on our regional banks white paper, applying our NLP platform to the full set of earnings calls from regional banks this quarter to explore the state of uncertainty before an expected rate cut on September 18th. Our rationale for close scrutiny of regional bank earnings calls holds true since our last publication as we find deceptive commentary indicating there may be underlying uncertainty regarding headwinds to net interest margins.
September 10, 2019

Analysts and Executives Silent on California Consumer Privacy Act

Under four months until the implementation of the California Consumer Privacy Act, Amenity’s text analytics tools detect a concerning absence of commentary in quarterly earnings calls. Against the backdrop of GDPR’s recent history, we would expect significantly more focus in the Q&A between analysts and management teams. We use our platform to contextualize CCPA in the broader context of global data privacy reform.
July 30, 2019

Sentiment Analysis: Regional Banks Shaky Prior to the Fed's Interest Rate Decision

We use our NLP platform to analyze regional bank earnings calls and estimate economic uncertainty in advance of the Federal Reserve’s rate decision. We uncover elevated deception levels focused on margin topics related to interest rates and net interest income, revealing evasive and euphemistic language patterns.
July 24, 2019

Snapchat Earnings: Beyond the Headline a Look at Cost-Price

Snapchat's 2Q19 showed a turnaround moment with beats on user growth and revenue, but a look beyond the headlines through the lens of our text analytics platform shows that while Deception has tapered off SNAP's 1Q18 high, the trend in Cost-Price is worth a closer examination.

Stay Informed: Join Our Newsletter

Keep up to date with our analyses and how we're making changes.