Hundreds of big companies talked about the impact of the coronavirus in recent earnings calls.
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Topline: 421 different global companies have so far indicated that the fast-spreading coronavirus in China could negatively impact financial results for the first quarter, according to data from natural language processor Amenity Analytics.
- As of Friday morning, some 421 different companies—394 of which are U.S.-based—have talked about the coronavirus on first quarter earnings calls, according to Amenity Analytics. The virus has been mentioned a total of 2,210 times so far.
- Executives at big-name companies, ranging from Apple and Nike to Starbucks and McDonald’s, among others, have all raised flags about the impact that the virus could have on business in China—and subsequently corporate earnings next quarter—as they close stores.
- Of all the companies warning about negative effects of the coronavirus on business, Yum China—one of the largest fast-food operators in the country, with brands like Pizza Hut, Taco Bell and KFC—spoke about the disease the most, mentioning it no less than 45 times during its earnings call.
- Casino and hotel operators have also acutely felt the impact from closures due to the virus: On the earnings call for Las Vegas Sands, for instance, coronavirus was mentioned 27 times, while Wynn Resorts on the other hand said it was losing up to $2.6 million per day.
- Luxury goods companies have also taken a hit amid weaker consumer demand in China: Companies that spoke about coronavirus the most in earnings calls include LVMH (19 mentions), Capri Holdings (17) and Estee Lauder (14).
- Cruise line operators, which have largely struggled as the virus takes a toll on the global tourism industry, spoke about the impact on scheduled voyages: Royal Carribean Cruises, for example, mentioned coronavirus 22 times on its call.
Crucial statistics: The coronavirus has by now infected more than 31,000 people worldwide and killed 636, though the WHO said on Friday that the number of new cases in China were finally starting to slow down somewhat.
Big number: The UBS China Economics team expects that GDP growth will slow to 3.8% year-over-year in the first quarter, but rebound in the second half of the year. By those estimates, the virus will bring China’s 2020 GDP growth to 5.4%, despite the government’s official forecast of 6%, the report finds. One top economist, Evercore ISI chairman Ed Hyman, said in an interview with CNBC that he sees 0% GDP growth in China for the first quarter. “China is really slowing and that’s worrying people for sure.”
Tangent: Out of the 322 companies in the S&P 500 that have so far reported earnings for the fourth quarter of 2019, 70.5% have beaten expectations, compared to 18.9% that missed estimates (in a typical quarter, 65% of companies report above expectations and 20% report below them), according to Refinitiv data.
Key background: As the Wuhan coronavirus continues to spread around China and to other countries, an increasing number of major companies have responded to the situation by suspending some business operations, restricting travel and more.
*Data is sourced from Amenity Analytics, a technology firm focused on using natural language processing to analyze earnings call transcripts. As part of its NLP solutions, Amenity developed a model that targets language related to the coronavirus, providing data on earnings calls going back to January 20, 2020. A coronavirus mention constitutes prepared management remarks, analyst questions and management responses to questions as of 1:00 p.m. on February 7th.