Header Ads Widget

Responsive Advertisement

IoT Analytics : What CEOs Talked About In Q3/2022

IoT Analytics : What CEOs talked about in Q3/2022

IoT Analysis: What CEOs are Talking About in Q3 2022

IoT Analysis: What CEOs are Talking About in Q3 2022

IoT Analytics conducted a keyword analysis of approximately 3,000 earnings calls from approximately 1,500 publicly traded US companies and identified five exciting themes that could inform a strategic agenda for the third quarter of 2022.

Key terms :

  • Three hot topics in the third quarter of 2022: recession, raw materials and Industry 4.0
  • The mention of sustainability topics decreased in the last quarter, but seems to have stabilized more than in previous years. Hybrid work excludes telecommuting.

Main Quote :

  • Philip Wegner, Senior Analyst at IoT Analytics, said:

    “Boardrooms are focused on weathering the economic downturn and discussing immediate threats to your business, such as recession, inflation, and disruption to supply chains. However, in the last two years, topics related to sustainable development have increased significantly, although they have decreased slightly in the last quarter.

What CEOs are talking about in the third quarter of 2022: economic recession, raw materials and industry 4.0

recording

In the third quarter 2022 earnings report, 35% of CEOs cited the recession as the top topics for layoffs, hires (freezes), and reductions.
Industry 4.0 (+143% growth from Q2 2022) and other technology-related topics (eg process automation +53%) grew strongly, albeit at a slower pace.

The top three topics we track continue to be COVID-19, inflation, and supply chain (cited in 57% to 72% of all phone calls).

Topics like slowing economic growth and automation gained more prominence during the third quarter, while other topics that received significant attention in the previous quarter receded. Many executives still mention Russia (16%) and Ukraine (19%), but about 50% less than in the previous quarter. Additionally, discussions of hybrid work (-28%) and remote work (-50%) were down last quarter (see analysis below). In the third quarter of 2022, the topic of new jobs lost relevance in the conditions of high inflation and an unstable economic environment.

In this article, we take a closer look at five exciting topics, including three key upcoming topics (economic slowdown, commodities, and Industry 4.0) and two other exciting topics, namely hybrid/remote work and sustainability.

Chart: What CEOs are talking about in Q2 2022 vs. Q2 2022

| About the analysis
The "What CEOs Are Talking About" analysis (featured in this article) presents the results of IoT Analytics' study of earnings calls from approximately 1,500 publicly traded US companies for the third quarter of 2022. The resulting visualization reveals the themes digital and related that are the CEO's priorities in the third quarter of 2022. The graph visualizes the importance of keywords and their growth as follows:
X-axis – Keyword importance (i.e., how many companies mentioned the keyword on their Q3 earnings calls). The further a keyword is on the x-axis, the more often the topic is mentioned.
Y-axis: Keyword growth (i.e. increase or decrease in mentions from Q2 2022 to Q3 2022 at an index of 100). Numbers > 100 on the Y axis indicate that the problem is becoming more important, while numbers < 100 indicate that the problem is becoming less important.

#1 MOST IMPORTANT TOPIC FOR THE FUTURE: THE ECONOMY IS BETTER

On the third-quarter 2022 earnings call, 35% of all CEOs spoke of a "recession." This is 74% more than in the previous quarter. Analysis shows that many of the upcoming conference call topics, such as "recession," are related to a weak economy. Since inflation has not been observed for decades, 71% of all calls in Q3 2022 were about inflation (up 4% from the previous quarter, but up 646% overall in the last two years) . Gloomy forecasts for economic growth have led to numerous board meetings where layoffs have been discussed.

In the third quarter of 2022, the keywords Downsizing (+83%), Downsizing (+54%) and Hiring (+22%) saw significant growth in the third quarter of 2022. It should be noted that companies They usually talk about "recruitment". Freeze the hiring or non-hiring context. However, many companies are still looking for employees and the job market seems very tight. The US job vacancy rate is still higher than the unemployment rate. In addition, unemployment in Europe continued to decline in quarters 3-22. However, companies as diverse as Klarna, Credit Suisse, Meta and Ford have all announced layoffs or hiring freezes in the third quarter of 2022.

Chart: Recession talk hits record high

Discussions about a recession are more common now (35%) than in the second quarter of 2020 (33%), when the recession due to COVID-19 reached a tipping point. Since IoT Analytics started tracking call revenue (Q1 2019), talk of a recession peaked in Q3 2022.

Main Quote :

“We see advertisers worrying about a potential recession, so we see them cutting costs where they can easily turn it off and on ,” Anthony Wood, CEO of Roku , July 28, 2022.

“Given the uncertain global economic outlook and hiring progress to date, as previously announced by Sundar, we intend to slow our hiring pace. We expect our hiring actions to be clearer in 2023." - Ruth Porath, CFO, Alphabet , Jul 26, 2022

“There is a huge opportunity for talent looking to build their future with ServiceNow. As an employer, ServiceNow is hiring when others in the technology industry slow down or even stop hiring. We are hiring. We're doubling down on our brand of talent." – Bill McDermott - CEO, ServiceNow , Jul 26, 2022

NEXT KEY TOPIC #2: ASSETS

Few CEOs (3%) spoke about copper (+30% compared to Q2 2022), and 2% spoke about lithium (+13%). The two commodities are part of a long list of other commodities, including timber, nickel and cobalt, whose prices have seen increased volatility in the last three years.

The price of copper rose sharply and, after reaching a low in March 2020, reached an all-time high in March 2022. Since then, its record price has fallen by 18% in the last six months.

Lithium is essential for many types of batteries and is essential for connected devices and electric vehicles. In the third quarter of 2022, GM unveiled a new supply chain initiative, with Tesla CEO Elon Musk urging entrepreneurs to get into the lithium recycling business, calling it a "license to print money" ( see quote below). Over the past year, lithium prices have increased by 190%.

Policymakers are trying to ease the pain of strained commodity supply chains by pushing for more strategic autonomy. For example, the European Union is working on a raw materials law that includes early warning systems and crisis management mechanisms for critical raw materials, increasing investment in production and processing, and ensuring a competitive environment around the world.

Main Quote :

“This means that GM has entered into binding contracts to supply our entire battery inventory, supporting our goal of reaching 1 million units of annual capacity in North America by 2025. This includes lithium, nickel, cobalt and lithium refurbishments. complete CAMs. Going forward, we will continue to localize our supply chain the same way we have localized battery cell production." - Mary Barra, CEO of General Motors , July 26, 2022

"There is such a range now in lithium processing. I really want to encourage entrepreneurs to get back into the lithium recycling business. You can't lose. It's a license to print money." - Tesla CEO Elon Musk, 21 July 2022

#3 KEY THEME OF THE FUTURE: INDUSTRY 4.0

To a lesser extent than the topic mentioned above, Industry 4.0 covered 0.4% of all CEOs in Q3 2022 (+113% from Q3 2022). Of course, Industry 4.0 mainly refers to the manufacturing industry. IoT Signals: Manufacturing Highlights (August 2022), a report published jointly by IoT Analytics, Microsoft, and Intel, shows that 72% of manufacturers have partially or fully implemented a smart factory strategy to date.

Despite the pandemic, looming recession, inflation, and global supply chain challenges in recent years, manufacturers are determined to accelerate their digital transformation projects over the next three years. As several companies have made significant investments in Industry 4.0 in recent years, application success stories are now included in the results, as evidenced by some of the quotes below.

Main Quote :

"We have a factory. Some of them are already in Industry 4.0. And all these investments and strategies have paid off. " - Judy Marks - CEO, Otis Worldwide , July 27, 2022

“Manufacturing automation is something we have been doing for a number of years. I'm thinking of the Ivery unit we built at Pratt Canada that came online more than five years ago. That is why we have opted for Industry 4.0 in all our factories. We have a new project in Dallas, we have a new facility, we have an automated facility going there." - Greg Hayes, President and CEO of Raytheon Technologies , July 26, 2022

#4 TOPICS OF INTEREST: REMOTE CONTROL AND HYBRID WORK

In the third quarter of 2022, remote work calls represented 1.1% of salary calls. That's down 50% sequentially and down 94% since peaking in Q2 2020. Meanwhile, hybrid jobs were mentioned by 2.3% of CEOs, down 28% sequentially.

Two future events occur:

    1. Remote work was a top topic during the COVID-19 lockdown, with 18% of CEOs reporting it during a conference call. Since then it has declined and seems to be a thing of the past.
    2. Hybrid work has evolved very slowly compared to remote work. While remote work may never reach double digits, it is more likely to remain relevant in the long run. It has declined from its peak of 4% in the third quarter of 2021, but seems to have stabilized around 2%.

Most CEOs seem to be aiming for a hybrid job with some mandatory work days but more freedom than the COVID-19 lockdown. For example, Apple, Google, and Tesla have called their home office workers to their fast bases. However, most offer a greater degree of freedom than three years ago.

Main Quote :

“The year-over-year increase in general and administrative expenses was driven by higher income-related sales taxes, as well as higher staffing costs due to the return to a hybrid business environment ,” David Goulden, CFO, Booking . Holdings , August 4, 2022

"Hybrid working just happened, and synchronous, asynchronous, remote, and face-to-face collaboration is critical." - Satya Nadella, Chairman and CEO of Microsoft , July 27, 2022

Image: Hybrid work has replaced telecommuting as a leitmotif

#5 TOPICS OF INTEREST: SUSTAINABILITY, CLIMATE AND EMISSIONS

Compared to the previous quarter, the share of earnings related to sustainable development (discussed by 21% of all CEOs), climate (14%) and emissions (13%) decreased. However, in the long term, it shows a very positive dynamic since the first quarter of 2019. All three themes gained importance in the large boardroom. At the beginning of 2020, discussions on the transition to a more sustainable and green economy were drowned out by the noise caused by the COVID-19 lockdown. The same thing is happening now, as CEOs focus on dealing with a looming recession, high inflation, and great uncertainty. Despite this, most CEOs believe that a shift to sustainability is more beneficial to their company.

Main Quote :

“We are seeing an explosion of IoT. You see, any climate action is going to be attractive to our business because you have to connect all these industrial systems to manage them.” — Chuck Robbins - Cisco Systems Aug 17, 2022 President and CEO

“One of the biggest long-term opportunities for alternatives lies at the intersection of infrastructure and sustainable development. The recent supply shock has only heightened the focus on energy security and increased the need for infrastructure investment." - Larry Fink - Black Rock Chairman and CEO July 15, 2022

Graph: 3-year growth trend in topics related to sustainable development

Source: IoT Analysis

The IoT Analytics: What CEOs Are Talking About Q3 2022 article first appeared on IoT Business News.

Post a Comment

0 Comments