The Influence of Data Visualizations on Investor Information Processing: Evidence from Earnings Conference Call Slideshows

ABSTRACT

I examine the association between data visualizations in earnings conference call presentations and contemporaneous disclosure processing outcomes. I find that the use of data visualizations in this setting is associated with decreases in abnormal information asymmetry and increases in abnormal market liquidity. In addition, I find that data visualizations help investors process information when investors face greater acquisition and integration costs. Finally, I find that data visualizations are associated with increased trading activity and trade profitability for less-sophisticated investors. Overall, my results suggest that the use of data visualizations in earnings conference calls can reduce investors’ processing costs and improve market outcomes.

Data Availability: Data are available from sources identified in the text.

JEL Classifications: D83; G14; M41.