With the fourth quarter 2022 earnings cycle in full swing, we conducted a preliminary analysis of the first 30 available earnings call transcripts to date to gain early insight into GCC corporate and investor sentiment trends. The results of this analysis indicate that the declining sentiment witnessed during the previous fiscal quarter appears to have continued during earnings calls hosted between January and February 2023 (FQ4 2022).
The Iridium GCC Earnings Call Sentiment Index dropped 4.1 points or 12% quarter-on-quarter in the preceding quarter (3Q 2022). While GCC earnings call sentiment may have remained resilient during the first half of the year 2022, it was unlikely that GCC markets would remain immune to equity market contractions in global emerging and developed markets, and to the impact of rising interest rates, inflationary pressures, oil price volatility, and fears of recession.
In summary, our preliminary analysis of the fourth quarter 2022 earnings season reveals a continuing deterioration in GCC earnings call sentiment, driven by the analyst and investor community. This decline in sentiment corresponds with further declines in GCC equity markets, and it is a clear indication of the challenges that lie ahead. It is essential for GCC companies to remain resilient in the face of these challenges and continue to communicate with transparency and clarity during earnings calls to mitigate the impact of negative market sentiment.