“A LINK to the call will be provided on Twitter, Facebook and Linkedin,” and with that Michael R. Kourey, Chief Financial Officer of Polycom Inc. (NASDAQ:PLCM) begins reading the obligatory caution about forward-looking statements on his company’s Q4 2010 earnings call.
For the past several quarters, the Pleasanton, California-based maker of video and telecommunications products has been quietly working to tightly integrate social media and – unusually for US companies – video webcasting into the company’s regular quarterly reporting process.
In many respects, what Polycom is doing is leading edge in the US investor relations field. However, it’s worth noting that according to an interview last August with the company’s VP of corporate communications Caroline Japic , it’s all run directly by the CFO and Polycom’s corporate communications team rather than anyone with a typical IR role.
Video Webcasting of Earnings Call
Although Polycom’s use of social media like Twitter, Facebook, Linkedin and YouTube in its quarterly reporting to investors is noteworthy, the more unusual practice is the company’s use of live video webcasting for its quarterly conference call with analysts and investors.
Audio-only earnings calls are common, but video conference calls are almost unheard of in North America. In fact, they’re rare even in Europe, where large companies often video webcast earnings results presentations in front of a live audience of analysts.
To be honest, though, it’s a little strange to watch Kourey and CEO Andrew Miller stand up and deliver their prepared remarks for 30 minutes. It would be better if they used a slide presentation to focus attention away from themselves. There is only so much teleprompter reading one can take before the manner of their delivery overwhelms the substance of their message.
However, the real value of video webcasting earnings calls comes during the Q&A. That’s where being able to watch the executives’ responses to questions from analysts adds a dimension missing from audio-only calls. Investors get to see the executives’ body language, take note of how prepared they are, see if they’re beckoning across the room for someone to quickly look up the figures an analyst is asking about.
Of course, that’s probably why we don’t see more companies using live video streaming of their earnings calls, even though services like Livestream, Ustream, Brightcove and others have made it cost effective and easy to do. So all credit to Polycom’s executives for having the confidence to do live video earnings calls.
Polycom has several Twitter accounts, but it uses its main http://twitter.com/polycom account to tweet highlights from its earnings calls.
The live tweeting sessions start with an alert about forward-looking statements that includes a link to the company’s earnings release, where the complete disclaimer can be found near the bottom of the page.
It would be better, though, to link to the disclaimer on a separate page so that investors have immediate access to it and don’t have to skim through the release to find it. eBay’s approach is the best practice. It includes a link to the Regulation G disclosures as well.
Polycom tries to tie all of its earnings tweets together by using a unique hashtag – #PLCMQ410. The idea is that if someone sees one of the tweets in isolation, they will be able to see that the message is part of a series, which should include the cautions. Whether the courts will agree that hashtags effectively connect isolated messages still has to be tested, but at least the company is trying.
However, since Polycom’s tweet about forward-looking information (above) does not include the hashtag, it isn’t connected to any of the tagged tweets. In this case, that’s probably not an issue because none of the company’s tweets include specific financial forecasts. Still, it’s important to remember that the hashtags around earnings calls are primarily there to connect the disclaimer to the other tweets.
Polycom posts information about its quarterly results on its main corporate Facebook page, which has almost 2,500 followers. For the most recent announcement, four separate notes were posted to the page’s Wall:
- The first, at 12:12 pm ET, alerted followers that earnings would be released after the close, with the earnings call starting at 5:00 pm that afternoon;
- The second, at 5:14 pm ET, said the earnings call was underway and people should follow tweets on Twitter;
- The third, at 5:44 pm ET, provided a link to the earnings release; and,
- The fourth, at 7:10 pm ET, announced that a YouTube video of Kourey explaining the results was available on YouTube.
While it’s unlikely that anyone following the company on its Facebook page is doing so to get breaking financial news for trading purposes, I still think companies need to strive to post financial disclosures simultaneously to all of their web properties. The earnings release itself was posted on the Facebook page 99 minutes after it was released.
CFO Video on YouTube
On top of everything else, CFO Kourey also records a video that is uploaded to YouTube after the company’s earnings call. The most recent video has been viewed 250 times as I write this. The video is simply a 3-minute address to investors shot by a single camera and is similar to what other CFO’s are doing.
The previous quarter’s video ran to a more leisurely 7 minutes. The result of the shortened video is a rapid-fire delivery that is quite difficult to follow. Add to that a distracting backdrop and it’s unlikely that this particular video is an effective communications piece. Watch it below and tell me what you think.
Overall, Polycom is using multiple channels to take the company’s investment story to investors. This is not an easy task. It requires attention to detail and stringent standards of execution. However, the pay off in the end is that more people are getting the story and management is more accessible.
Sure, I’ve pointed out a few blemishes, but I’d love to see you do better than Polycom. Go on, give it try…