This is an awesome move. They’re not saying the reports go away—just moving them to every six months. After hating how each company runs on an internal quarterly cycle, I have to welcome it despite how the change originated. Six months is still short from the perspective of perverse incentives, but if you free up one week of charade from execs every 13 weeks, maybe they can focus better.

And it’s not just execs, but the whole corporate machinery that takes 3–6 weeks after quarter end to churn out reports. Of course, internally executives should be tracking performance daily, but the quarter-end panic could lessen. If you have a bad quarter, you’re not penalized as much if the surrounding months are good.

And anyway, if there is a material adverse change the companies should be expected to disclose, like they are expected now.

Ps: I posted the same on Reddit a couple of hours back. Not AI but if you do find the account don't mention them online in the same sentence.

> And it’s not just execs, but the whole corporate machinery that takes 3–6 weeks after quarter end to churn out reports.

Release early, release often.

If you want corporate machinery to run more smoothly with less effort, force it to operate more frequently not less: when TLS certs had 2-3 year lifespans there was all sorts of manual methods that people forgot how to do; then it was maximum one year. We then got free certs from LE (using ACME), but they were 90 days, so that made automation much more necessary.

Now with certs from public CAs having a max time of 47 days soon (not that I'm necessarily a fan) automation is all but a must.

So if you want less onerous effort on corporate reporting, your workflows and processes need to be much more automated: that's one of the reason why computers were invented after-all, to make computations faster.

And one way to force automation is to insist on more frequent reporting, not less; Barry Ritholtz:

> This is exactly backward: More frequent reporting makes the data less significant. In the real world, human behavior emphasizes what occurs less often—meaning doing something less frequently gives it an even greater significance than something that becomes routine or common.

> That is the difference between a New Year’s Eve celebration and a married couple’s weekly date night.

> Twice-a-year earnings reporting will make the event so momentous, with such focus on it, that any company that misses analysts’ forecasts will find their stock price shellacked. The twice-yearly focus on making the per-share number will become overwhelmingly intense.

* https://www.fa-mag.com/news/reporting-profits-daily-would-en...

Move from quarter / every-3-months to monthly reporting: companies will be forced to automate their "corporate machinery". And each report will be much less 'momentous' because the time between samples will be much less.

What will actually happen is that frauds and poorly run companies will opt for the 6 month schedule while well run ones will keep the 3 month.

To your point that "executives should be tracking performance daily", there's an argument that all that data should be publicly released daily. It would make it nearly impossible to hide mismanagement and actually remove most of the human overhead since it would be impossible to spin bad data on a daily basis.

I have the opposite opinion. More information is always better. Absolutely the reporting requirements are onerous and there already are perverse incentives to chase things quarterly. Reducing reporting requirements is only going to make things worse though. The only solution I can imagine is to instead drop reporting requirements to instant. Make all public companies truly public. Reporting information should to be accessible via a feed 24/7. There can be no more perverse incentives if there’s no hiding. Insane and unlikely? Sure yea. But let’s not pretend that reducing information is going to help anything.

> If you have a bad quarter, you’re not penalized as much if the surrounding months are good.

GE used to smooth their earnings to accomplish exactly what you describe here. This was not good for investors, or transparency, or ultimately GE itself[1].

There's ample reason to want more frequent, not less frequent, results from companies.

> the whole corporate machinery that takes 3–6 weeks after quarter end to churn out reports

> internally executives should be tracking performance daily

Executives would also be better served by having more timely access to the same data they will eventually disclose. Why would executives want to drive blind for more of the time?

1 - https://markets.businessinsider.com/news/stocks/warren-buffe...

There's also just a mathematical way to look at volatility here, which is that if you look at (say) the average monthly result as a statistic for the reporting period, longer reporting periods have lower variance than shorter reporting periods.

It's something of a diversification benefit - when you're able to smooth over months, as long as they're not all perfectly correlated (your shock just keeps hitting over and over and you can't stop it) - your results will have lower variance once normalized for elapsed time.

What I can't speak to is whether this is a benefit to economic stability. Say an industry is shifting rapidly in a certain direction. Companies less able to adapt would be less quickly "punished" for that lack of adaptation.

The question is whether that adaptation curve is "a company may need extra time and upfront investment in transformation, but can get back on the curve, so giving them grace helps to stabilize jobs and markets..." vs. "a company that falls off the curve will continue to fall behind, so faster reporting incentivizes companies to innovate and not get into an irrecoverable state that destroys value."

And I think this question varies so widely between situations that it's difficult to standardize. Perhaps economists have looked at this more thoughtfully. Either way, this is an incredibly significant change - how so is a much more difficult question.

I see how it helps you and the company. What about investors who you borrowed money from.

I can't help but think of friends of mine that always complained about their quarterly OKR reports.

Hard disagree. These are public markets we are talking about, which give companies access to financing from mom and pop investors. No one is forcing these companies to be public, they chose to be public because they wanted access to the liquidity provided by public markets. That liquidity is coming from folks retirement savings.

I was following a company that did an ATM offering in January. By June, less than six months later, they had entered Chapter 11. Things can move fast in the business world. A financing deal falling through at the wrong time can be the difference between business as usual and bankruptcy.

This change would largely benefit insiders and deep pocketed investors/funds that can afford bespoke data sources to fill in the gaps. And it feels like just another attempt by Wall street to force mom and pop investors into the role of dumb exit liquidity.

> After hating how each company runs on an internal quarterly cycle

In 25 years of working professionally I've never felt this or heard this even once.

> execs every 13 weeks, maybe they can focus better.

I don't care about the struggles of executives. I'm entirely unconvinced that an additional two weeks a year will afford them enough "focus" to make any appreciable difference.

> that takes 3–6 weeks after quarter end to churn out reports.

We run a sales heavy organization. No one "churns" out reports and hasn't for decades. The biggest struggle is getting engineering to finalize their existing capital project reports. Everything else is automated to such an extent that I can't even fathom this scenario still existing.

this is an incompetent, corrupt change that will be reversed when Trump leaves office in 2029. Companies should likely not change their quarterly reporting since it will only be temporary.