Artificial intelligence has been a focus topic for the market in recent months. Given the heightened interest, did more S&P 500 companies than normal comment on “AI” during their earnings conference calls for the second quarter?
The answer is yes. 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 “AI” in the conference call transcripts of all the S&P 500 companies that conducted earnings conference calls from June 15 through September 7.
Of these companies, 177 cited the term “AI” during their earnings call for the second quarter. This number is well above the 5-year average of 60 and the 10-year average of 37. In fact, this is the highest number of S&P 500 companies citing “AI” on earnings calls going back to at least 2010 (using current index constituents going back in time). The previous record was 117, which occurred in the prior quarter (Q1 2023). This number also reflects a quarter-over-quarter increase of more than 50%.
At the sector level, the Information Technology has the highest number (56) and percentage (88%) of S&P 500 companies citing “AI” on Q2 earnings calls.
It is interesting to note that S&P 500 companies that cited “AI” on Q2 earnings calls have seen a better average stock price performance in recent months compared to S&P 500 companies that did not cite “AI” on Q2 earnings calls. For S&P 500 companies that cited “AI” on Q2 earnings calls, the average change in price since June 30 is -0.8% and the average change in price since December 31 is 13.3%. For S&P 500 companies that did not cite “AI” on Q2 earnings calls, the average change in price since June 30 is -2.3% and the average change in price since December 31 is 1.5%. Even excluding the “Magnificent Seven” (Alphabet, Amazon, Apple, Meta Platforms, Microsoft, NVIDIA, and Tesla), the S&P 500 companies that cited “AI” still outperformed the S&P 500 companies that did not cite “AI” on average during these periods.
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