Why CEOs May Want To Consider Avoiding TV Appearances After Earnings

I like earnings season because of the surprises. But sometimes, you get to see something repeat itself over and over again: In what has become a tough reporting period, CEOs are taking to broadcast outlets explaining, first hand, the shortcomings of the most recently reported results.

Notable so far this season was Sally Smith of Buffalo Wild Wings and Jeff Weiner of LinkedIn following earnings reports. Smith went right into the crucible, appearing on Mad Money with Jim Cramer explaining among other items, the importance of takeout, while Weiner appeared on screen to unravel sequentially flat revenues and lumpy EBITDA.   

It’s hard to quibble with the success of these entrepreneurs. They’ve made billions for investors, and that alone may be all the street cred they need. If they feel broadcast exposure is what the market needs to understand their shares correctly, then their point of view should be taken into consideration.

But one size does not fit all. There are many investors for whom Meet The Press-type investor relations is a turn off. These investors look for leadership that is in the background solving problems and not in the foreground talking about them. I don’t sense that investors are being being preachy about this - it’s just their preference.

Of course you can’t make everyone happy all the time, and keeping quiet has its detractors too.

However, there’s some evidence to suggest that whatever deficiencies any given quarter may possess, executives have plenty of opportunity to tell their side of the story including the earnings release, the filing, the conference call, Q&A, blogs, tweets, posts, and podcasts, all accessible to just about anyone on earth interested enough to tune in.

But what, four more minutes on TV — which I might add are the four most uncontrollable minutes in a CEO’s arsenal — is what’s going to put it all into perspective?

To be fair, perhaps some executives can use broadcast appearances to manage investor perceptions the same way Donald Trump has mastered the media in service of politics. But if it’s not your style, then stay in the background and fix whatever problems exist and work on increasing earnings. That is the ultimate investor relations program.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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