Logical Analysis Report

Key Focus

  • Unfortunately, it appears that the pandemic is more like the 'new normal,'and may impact operations in future periods even more significantly than it did during the first quarter."
    When AT&T Inc US:T posted first-quarter results in late April, it disclosed in the second line of its release that it saw adjusted earnings per share "of $0.84 ($0.89 without COVID-19 impact)." Later in its release, AT&T said it "did not adjust for COVID-19 costs of about $0.05 in the quarter" since the company expected the costs to be "short term."
    The company did not break down the drivers of that earnings impact in its release, but provided some more detail in a supplemental investor-briefing file
  • COVID-19 is leading to new non-GAAP metrics.and could prompt companies to dump all sorts of costs into periods affected by the crisis
    The practice of adjusting away COVID-19 impacts from financial metrics has been the subject of jokes on Twitter, including by those who designed coffee mugs to satirize the idea of earnings before interest, taxes, depreciation, amortization, and coronavirus, dubbed EBITDAC.
    The COVID-19 outbreak has brought out some creative accounting at companies, as executives attempt to gauge the impact of the pandemic on their businesses and how they would have performed if the crisis hadn't all but shut the economy down.
    Before companies began reporting first-quarter earnings, Twitter users joked that the outbreak would prompt new non-standard metrics that could be summarized as "earnings before COVID-19," or EBITDAC, and they even created a series of coffee mugs that satirized the concept
  • The company increased its adjusted net revenue by $19 million to add back "payments for financial assistance to drivers personally impacted by COVID-19."
    It increased adjusted Ebitda by $24 million to remove those relief payments to drivers along with the costs of personal protective equipment given to drivers.
    Uber did not respond to a request for comment

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High Level Topics

  • EARNINGS
  • COVID-19
  • COSTS
  • INVESTORS

    • High Level Abstractions

  • EARNINGS(6, 0 Order)
  • ( EARNINGS )(6, 0 Order)  top
  • ( EARNINGS, COVID-19 )(3, 1st Order)  top
  • ( EARNINGS, DRIVERS )(3, 1st Order)  top
  • ( EARNINGS, COSTS )(3, 1st Order)  top
  • ( EARNINGS, CRISIS )(2, 1st Order)  top
  • ( EARNINGS, TWITTER )(1, 1st Order)  top
  • ( EARNINGS, TAXES )(2, 1st Order)  top
  • ( EARNINGS, REVENUE )(2, 1st Order)  top
  • ( EARNINGS, OUTBREAK )(1, 1st Order)  top
  • ( EARNINGS, NON-STANDARD )(2, 1st Order)  top
  • ( EARNINGS, INTEREST )(2, 1st Order)  top
  • ( EARNINGS, GLOBAL )(2, 1st Order)  top
  • ( EARNINGS, FIRST-QUARTER )(2, 1st Order)  top
  • COVID-19(3, 0 Order)
  • ( COVID-19 )(3, 0 Order)  top
  • COSTS(3, 0 Order)
  • ( COSTS )(3, 0 Order)  top
  • INVESTORS(3, 0 Order)
  • ( INVESTORS )(3, 0 Order)  top

    • References

    • ( EARNINGS )  top
    • ( EARNINGS, COVID-19 )  top
    • (Read more)   top
      The practice of adjusting away COVID-19 impacts from financial metrics has been the subject of jokes on Twitter, including by those who designed coffee mugs to satirize the idea of earnings before interest, taxes, depreciation, amortization,...
    • (Read more)   topThe company increased its adjusted net revenue by $19 million to add back "payments for financial assistance to drivers personally impacted by COVID-19."
      It       increased adjusted Ebitda by $24 million to remove those relief payments to drivers along with the costs of personal protective equipment given to drivers.
      Uber did not respond to a request for...
    • (Read more)   top
      When AT&T Inc US:T posted first-quarter results in late April, it disclosed in the second line of its release that it saw adjusted earnings per share "of $0.84 ($0.89 without COVID-19 impact)." Later in its release, AT&T said it "did not adjust for COVID-19 costs of about $0.05 in the quarter" since the company expected the costs to be "short term."
      The...
    • ( EARNINGS, DRIVERS )  top
    • (Read more)   top
      Uber's non-standard metrics include adjusted net revenue, which the company says is needed because its drivers are its customers, and not ride-hailing passengers.
    • (Read more)   topThe company increased its adjusted net revenue by $19 million to add back "payments for financial assistance to drivers personally impacted by COVID-19."
      It increased adjusted Ebitda by $24 million to remove those relief payments to drivers along with the costs of personal protective equipment given to drivers.
      Uber...
    • (Read more)   top
      The company did not break down the drivers of that earnings impact in its release, but provided some more detail in a supplemental investor-briefing file
    • ( EARNINGS, COSTS )  top
    • (Read more)   topCOVID-19 is leading to new non-GAAP metrics.and could prompt companies to dump all sorts of costs into periods affected by the crisis
      The practice of adjusting away COVID-19 impacts from financial metrics has been the subject of jokes on Twitter, including by those who designed coffee mugs...
    • (Read more)   top
      It increased adjusted Ebitda by $24 million to remove those relief payments to drivers along with the costs of personal protective equipment given to drivers.
      Uber did not respond to a request for comment
    • (Read more)   top ... in the second line of its release that it saw adjusted earnings per share "of $0.84 ($0.89 without COVID-19 impact)." Later in its release, AT&T said it "did not adjust for COVID-19 costs of about $0.05 in the quarter" since the company expected the costs to be "short term."
      The company did not break down the drivers of that earnings impact in its release, but provided...
    • ( EARNINGS, CRISIS )  top
    • (Read more)   topCOVID-19 is leading to new non-GAAP metrics.and could prompt companies to dump all sorts of costs into periods affected by the crisis
      The       practice of adjusting away COVID-19 impacts from financial metrics has been the subject of jokes on Twitter, including by those who designed coffee mugs to satirize the idea of earnings before interest,...
    • (Read more)   top
      There are questions, however, about the validity of adjusting away business activities related to a global health crisis when it's unclear how long the pandemic will crimp Uber's business.
      Then there's networking company Infinera Corp
    • ( EARNINGS, TWITTER )  top
    • (Read more)   top
      The practice of adjusting away COVID-19 impacts from financial metrics has been the subject of jokes on Twitter, including by those who designed coffee mugs to satirize the idea of earnings before interest, taxes, depreciation, amortization, and coronavirus, dubbed EBITDAC.
      The COVID-19 outbreak has...
    • ( EARNINGS, TAXES )  top
    • (Read more)   top... practice of adjusting away COVID-19 impacts from financial metrics has been the subject of jokes on Twitter, including by those who designed coffee mugs to satirize the idea of earnings before interest, taxes, depreciation, amortization, and coronavirus, dubbed EBITDAC.
      The COVID-19 outbreak has brought out some creative accounting at companies, as executives attempt to gauge the impact of the pandemic...
    • (Read more)   top
      The company also reports adjusted Ebitda, or earnings before interest, taxes, depreciation and amortization, which is already an adjusted number.
    • ( EARNINGS, REVENUE )  top
    • (Read more)   top
      Uber's non-standard metrics include adjusted net revenue, which the company says is needed because its drivers are its customers, and not ride-hailing passengers
    • (Read more)   topThe company increased its adjusted net revenue by $19 million to add back "payments for financial assistance to drivers personally impacted by COVID-19."
      It increased adjusted Ebitda by $24 million to remove those relief payments to...
    • ( EARNINGS, OUTBREAK )  top
    • (Read more)   top
      The COVID-19 outbreak has brought out some creative accounting at companies, as executives attempt to gauge the impact of the pandemic on their businesses and how they would have performed if the crisis hadn't all but...
    • ( EARNINGS, NON-STANDARD )  top
    • (Read more)   top
      Before companies began reporting first-quarter earnings, Twitter users joked that the outbreak would prompt new non-standard metrics that could be summarized as "earnings before COVID-19," or EBITDAC, and they even created a series of coffee mugs that satirized the concept
    • (Read more)   top
      Uber's non-standard metrics include adjusted net revenue, which the company says is needed because its drivers are its customers, and not ride-hailing passengers
    • ( EARNINGS, INTEREST )  top
    • (Read more)   top
      The practice of adjusting away COVID-19 impacts from financial metrics has been the subject of jokes on Twitter, including by those who designed coffee mugs to satirize the idea of earnings before interest, taxes, depreciation, amortization, and coronavirus, dubbed EBITDAC.
      The COVID-19 outbreak has brought out some creative accounting at companies, as executives attempt to gauge the impact of...
    • (Read more)   top
      The company also reports adjusted Ebitda, or earnings before interest, taxes, depreciation and amortization, which is already an adjusted number.
    • ( EARNINGS, GLOBAL )  top
    • (Read more)   top
      "People will get creative telling their story and our message is to be cautious of the creativity," said Sandy Peters, the head of global financial reporting policy at the CFA Institute in New York.
      Uber Technologies Inc US:UBER, for example, has always reported a range of non-GAAP measures, or those that do not comply with Generally Accepted Accounting Principles...
    • (Read more)   top
      There are questions, however, about the validity of adjusting away business activities related to a global health crisis when it's unclear how long the pandemic will crimp Uber's business.
      Then there's networking company Infinera Corp
    • ( EARNINGS, FIRST-QUARTER )  top
    • (Read more)   top
      Before companies began reporting first-quarter earnings, Twitter users joked that the outbreak would prompt new non-standard metrics that could be summarized as "earnings before COVID-19," or EBITDAC, and they even created a series of coffee...
    • (Read more)   top
      When AT&T Inc US:T posted first-quarter results in late April, it disclosed in the second line of its release that it saw adjusted earnings per share "of $0.84 ($0.89 without COVID-19 impact)." Later in its release, AT&T said...
    • ( COVID-19 )  top
    • (Read more)   topCOVID-19 is leading to new non-GAAP metrics.and could prompt companies to dump all sorts of costs into periods affected by the crisis The practice of adjusting away COVID-19 impacts from financial metrics has been the subject of jokes on Twitter, including by those who designed coffee mugs to satirize the idea of earnings before interest, taxes, depreciation, amortization,...
    • (Read more)   top... rather than detailing them in a footnote to its tables, she argued. Overall, only a small fraction of companies tracked by law firm Bass, Berry & Sims adjusted their adjusted Ebitda numbers for COVID-19 impacts based on a review of 55 reports filed between April 1 and May 14. Other companies did not actually adjust their formal numbers but gave a description of the effects. "That seems...
    • (Read more)   top ... quarter." When AT&T Inc US:T posted first-quarter results in late April, it disclosed in the second line of its release that it saw adjusted earnings per share "of $0.84 ($0.89 without COVID-19 impact)." Later in its release, AT&T said it "did not adjust for COVID-19 costs of about $0.05 in the quarter" since the company expected the costs to be "short term." The...
    • ( COSTS )  top
    • (Read more)   topCOVID-19 is leading to new non-GAAP metrics.and could prompt companies to dump all sorts of costs into periods affected by the crisis The practice of adjusting away COVID-19 impacts from financial metrics has been the subject of jokes on Twitter, including by those who designed coffee mugs...
    • (Read more)   top... back "payments for financial assistance to drivers personally impacted by COVID-19." It increased adjusted Ebitda by $24 million to remove those relief payments to drivers along with the costs of personal protective equipment given to drivers. Uber did not respond to a request for comment
    • (Read more)   top ... in the second line of its release that it saw adjusted earnings per share "of $0.84 ($0.89 without COVID-19 impact)." Later in its release, AT&T said it "did not adjust for COVID-19 costs of about $0.05 in the quarter" since the company expected the costs to be "short term." The company did not break down the drivers of that earnings impact in its release, but...
    • ( INVESTORS )  top
    • (Read more)   topIn its earnings report, it said that the exclusion of these metrics from the adjusted numbers was "useful" because it lets investors "assess the impact of these response initiatives on our results of operations." There are questions, however, about the validity of adjusting away business activities related to a global...
    • (Read more)   top ... to happen 10 years from now, but you could take that off right now, blame COVID, and no one's paying that much attention because everyone's suffering," he said. He recommends that investors look over the non-financial fundamentals that companies provide in order to better gauge whether businesses are massaging their accounting. Accounting issues could further come into play when...
    • (Read more)   top ... "perfectly reasonable in theory but in practice depends on what the metrics are and how well they explain it," Pozen said. "That's why a reconciliation requirement would be really helpful for investors," who vote on these proposals. For many companies, COVID-19 only began to manifest in financial results during the March quarter, though the impact will continue for months to come, requiring...