Trending topics typically ebb and flow. Some trends prove to be only a passing fad, while others prove more lasting. For instance, in the macroeconomic sphere, a healthy debate remains on the degree to which inflation will persist. During corporate earnings calls, the intensity of the topic of topic peaked in the first quarter of 2022, and has since receded. Among technology-related topics, generative artificial intelligence unsurprisingly reached a new peak during the second quarter of 2023. Notably, the less celebrated field of machine learning also reached a new peak. As Robeco’s quantitative research team highlighted in a recent note, natural language processing offers investors a new tool to analyze corporate trends by capturing a wider set of interrelated terms, even when a given term is not specifically mentioned.
Source: Robeco, Factset, S&P 500 constituent earnings calls, November 2023