Fewer S&P 500 Companies Discussing “Recession” on Earnings Calls for 5th Straight Quarter

Given continuing concerns in the market about a possible economic slowdown or recession, did more S&P 500 companies comment on recession during their earnings conference calls for the third quarter relative to recent quarters?

The answer is no. FactSet Document Search (which allows users to search for key words or phrases across multiple document types) was used to answer this question. Through Document Search, FactSet searched for the term “recession” in the conference call transcripts of all the S&P 500 companies that conducted earnings conference calls from September 15 through November 16.

Of these companies, 53 cited the term “recession” during their earnings call for the third quarter. After peaking in Q2 2022, the number of S&P 500 companies citing “recession” on earnings calls has declined for five straight quarters. The number of S&P 500 companies citing “recession” on earnings calls for Q3 2023 is 13% below the number in Q2 2023 (61) and 78% below the number in Q2 2022 (237). In fact, this quarter will mark the lowest number of S&P 500 companies citing “recession” on earnings calls for a quarter since Q4 2021 (15).

It is also interesting to note the number of S&P 500 companies citing “recession” on earnings calls for Q3 2023 is below the 5-year average of 84 and below the 10-year average of 60.

It should also be noted that there are still about 30 S&P 500 companies that have not reported earnings for the third quarter. Thus, the final number of companies citing “recession” will likely be higher than the current 53. However, it is unlikely the final number will finish above the previous quarter’s number of 61.

At the sector level, the Financials (14) and Industrials (12) sectors have the highest number of S&P 500 companies citing “recession” on Q3 earnings calls, while the Real Estate sector has the highest percentage (30%) of companies citing “recession” on Q3 earnings calls.

The FactSet Earnings Insight report will not be published on November 24. The next edition of the report will be published on December 1.

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