Podcast Summary: The Indicator from Planet Money

Episode: Should we ditch quarterly earnings reports?

Date: October 21, 2025
Hosts: Waylon Wong and Darian Woods
Special Guest: Rahul Washishta, Professor at Duke University
Additional Voice: Julie Bell Lindsay, CEO of the Center for Audit Quality

Main Theme & Purpose

This episode explores the ongoing debate around whether U.S. public companies should continue to report their financial earnings every quarter or shift to less frequent disclosures—specifically, twice a year. The hosts and guests examine the history, rationale, benefits, and drawbacks of the current system, drawing on research, regulatory changes, and the perspectives of investors, executives, and policymakers.

Key Discussion Points & Insights

1. Quarterly Earnings Reports: Origins and Purpose

• [00:12–01:24]

  • Quarterly earnings calls are standard practice for U.S. public companies, providing regular updates to investors.
  • Despite being formulaic, these calls are crucial for market transparency and investment decisions.
  • "This information helps investors make decisions about where to put their money. And if that investor is a company that manages your retirement fund ... then it's your money at stake." – Waylon Wong [01:07]

• [02:55–03:23]

  • The SEC, established in the 1930s, originally required annual reports, later increasing to semiannual, then quarterly in 1970 to prevent companies from concealing poor performance.

2. The Economic Rationale: Why Reporting Matters

• [03:23–04:11]

  • Rahul Washishta: Earnings reports ensure capital flows to the most productive companies, benefiting the entire economy.
    • "It allows for channeling the money to its correct destination ... That's when you make everybody better off." – Rahul Washishta [03:33]

• [04:11–04:34]

  • Financial reports have become more complex, with quarterly filings often exceeding 30 pages and including key disclosures about debt, legal risks, etc.

3. Arguments for Reducing Reporting Frequency

• Cost & Distraction

  • [04:34–04:53]
    • Preparing reports is expensive and time-consuming.
    • President Trump has advocated for semiannual reports, arguing it would save money and allow better management focus.

• Short-Termism Concern

  • [04:53–06:08]

    • Quarterly reports can promote "managerial myopia," discouraging long-term investments and innovation.
      • Rahul Washishta:
        • "When it comes down to most consequential decisions ... the consequences of those kind of choices, they're not going to show up in a quarter or two." [05:02]
        • Firms become reluctant to take actions that benefit the long term if they hurt short-term results.
        • Historical research (1950–1970): As reporting frequency increased, annual capital investment fell by 1.5%.
        • "The evidence ... clearly tells you that as you create these shorter performance measures, the quality of your long term decision making ... declines." – Rahul Washishta [06:08]

  • Sustainability Advocacy

    • [06:20–06:37]
      • Some climate-focused investors believe less frequent reporting encourages companies to prioritize long-term goals like sustainability.

4. Arguments for Maintaining Quarterly Reports

• [06:37–07:12]

  • More information means better decisions for both large and small investors.
  • Quarterly data promotes market confidence and more accurate stock pricing; less frequent reports can increase volatility.

• [07:12–07:44]

  • Julie Bell Lindsay: The SEC may set minimum requirements, but if investors want more frequent disclosure, companies often oblige (as in the UK).
    • "A lot of times what investors want is what companies are going to do ... There's nothing stopping companies from continuing to do that 10Q." – Julie Bell Lindsay [07:30]

5. Potential Compromise: Shorter Updates

• [07:58–08:16]
  • Some firms already issue brief earnings releases before the full report, offering headline numbers quickly.
    • "That is when the market moves ... what is truly important for the investors I think is at the heart of this discussion." – Julie Bell Lindsay [08:16]

6. Regulatory Outlook

• [08:30–08:41]
  • The SEC considered eliminating quarterly reports under the first Trump administration but did not take action.
• [08:41–08:56]
  • Renewed momentum: Chairman Paul Atkins is “fast-tracking” a proposal; possible changes as early as 2026.

Notable Quotes & Memorable Moments

• Jargon Watch: "Color"

  • Multiple “color” references by Wall Street analysts in earnings calls, humorously highlighted by Darian Woods.
    • "The color just drained from my face right now. Listening to that." – Darian Woods [00:55]

• Practical Reality Check

  • Closing with a playful back-and-forth between hosts and an analyst parodying typical earnings call banter.
    • "Congrats on the nice quarter." – Wall Street Analyst [09:07]
    • "Great episode to you too. It's been a great quarter." – Darian Woods [09:22]

Timestamps for Important Segments

• Quarterly Earnings Explained: [00:12–01:24]
• SEC History & Purpose: [02:55–03:23]
• Economic Function of Reports: [03:23–04:11]
• Arguments Against Quarterly Reporting: [04:34–06:20]
• Impact on Investment & Long-Term Thinking: [05:02–06:08]
• Investor & Regulatory Perspective: [06:37–07:44]
• Potential Compromise & Market Reactions: [07:58–08:16]
• Regulatory Update: [08:30–08:56]

Tone & Style

The episode maintains a wry, insightful, and conversational tone, mixing expert analysis with light humor and real-world examples, making the topic both accessible and engaging.

Conclusion

This episode provides a comprehensive, well-balanced look at the debate over the future of quarterly earnings reports, weighing the needs of corporations, investors, and the broader economy, while highlighting fresh research and imminent regulatory changes. For listeners curious about how information shapes markets and the potential impact of regulatory reform on long-term economic growth, this quick but informative episode hits all the key points.