Investor confidence in 2025 favors companies that execute effectively on operational control rather than pursuing ambitious AI initiatives. Research analyzing 350 earnings calls found that top-performing companies differentiate themselves through clear mitigation strategies, operational visibility, and rapid execution in response to tariffs and supply chain disruption, while underperformers focus more on AI ambitions without demonstrating concrete operational outcomes.
- 68% of earnings transcripts mentioned tariffs, directly impacting sourcing decisions, supplier negotiations, and manufacturing footprints across all sectors.
- Top performers linked AI and automation to specific operational outcomes like forecasting, labor scheduling, quoting, and customer engagement rather than general innovation goals.
- Operational control became the differentiator: stronger companies communicated clear mitigation strategies and visibility, while weaker performers cited uncertainty and limited forecasting confidence.
- Inventory management revealed performance gaps: top companies described inventory as normalized and optimized, while underperformers reported excess stock and demand mismatches.
- Visibility mentioned in 34% of transcripts, with successful companies linking it to demand confidence, backlog clarity, and planning transparency.
Tariffs became the defining supply chain concern of 2025, with other geopolitical events on the rise this year, according to the latest research from Cleo.
In fact, companies were not differentiated by whether they faced disruption, but by how effectively they translated visibility into coordinated execution, mitigation, and overall operational control.
“Across every sector analyzed, tariffs, inflation, sourcing pressure, and manufacturing constraints directly impacted business performance,” says Mahesh Rajasekharan, CEO at Cleo. “Disruption and volatility are no longer episodic. Executives at companies that outperformed their peers were the ones who deeply understood their exposure, mitigated risk, and executed quickly. In today’s ever-evolving markets, operational control has become a proxy for business confidence.”
Key takeaways:
· Tariffs, manufacturing, inventory, visibility, backlog, and inflation appeared frequently, according to more than 350 earnings call transcripts from publicly traded mid-market companies between January 2025 and March 2026 comparing the 25 companies with the largest post-earnings stock price increases with the 25 companies with the largest stock price decreases.
· The stronger-performing companies often communicated clear mitigation strategies, operational flexibility, stronger visibility, and greater control over execution. In contrast, weaker-performing companies more often framed those same issues around uncertainty, inventory imbalance, delayed recovery, cost pressure, or limited forecasting confidence.
· 68% of analyzed transcripts included mentions of tariffs, and were often tied to sourcing decisions, supplier negotiations, pricing actions, manufacturing footprint, and input costs.
· 65% of transcripts included mentions of inventory, with stronger performing companies describing inventory as normalized, optimized, or aligned with demand. Weaker performers were more likely to cite excess stock, carrying costs, destocking, or demand mismatch.
· Manufacturing appeared in 50% of transcripts, largely covering themes of companies’ production footprints, capacity, localization, and flexibility in responding to tariff and sourcing pressures.
· Over one-third (34%) of transcripts included mentions of visibility, with stronger performers linking it to demand confidence, backlog clarity, forecasting, and planning transparency. Conversely, lower-performing companies more often associated visibility with demand uncertainty or shortened planning horizons.
· Among the Top 25 performers, AI or automation was mentioned with 32% of earnings reports. When mentioned, these companies were more likely to connect the technology to specific operation outcomes, including forecasting, labor scheduling, quoting, and customer engagement.
