In December 2022, AT&T agreed to pay a $6.25 million penalty, the largest ever in a Regulation FD case, after investor relations executives privately called analysts at roughly 20 firms before an April 2016 earnings report.
The case did not accuse AT&T of misreporting its quarter, only of letting selected analysts hear the underlying information first.
Earnings releases concentrate that risk, because one document carries a quarter’s worth of material information through many hands before the market sees it.
What follows is a practitioner’s walk-through of the rules and the enforcement record, ending with a day-by-day control timeline for your next quarter.
What Regulation FD requires of an earnings release
Under Rule 100 of Regulation FD, when a company or anyone acting for it discloses material nonpublic information to certain outsiders, it must make that information public simultaneously if the disclosure was intentional and promptly if it was not.
Four groups of recipients trigger the rule:
- Broker-dealers and people associated with them.
- Investment advisers and institutional investment managers that report on Form 13F, including their associated persons.
- Funds that meet the Investment Company Act definition, including private funds that rely on the Section 3(c)(1) or 3(c)(7) exclusions.
- Shareholders, when it is reasonably foreseeable that they will buy or sell on the information.
A disclosure is intentional when the speaker knows, or is reckless in not knowing, that the information is both material and nonpublic.
“Promptly” means as soon as reasonably practicable, and never later than 24 hours or the next New York Stock Exchange open, whichever is later, after a senior official learns of the disclosure.
Communications staff sit inside the rule, because the definition of senior official expressly includes investor relations and public relations officers.
Two exclusions matter in earnings season: people who owe the company a duty of trust or confidence, such as outside counsel, and people who expressly agree to keep the information confidential.
Public disclosure can be a Form 8-K or any other method “reasonably designed to provide broad, non-exclusionary distribution of the information to the public.”
Form 8-K Items 2.02 and 7.01: deadlines and liability
Item 2.02 of Form 8-K applies when a company publicly announces material nonpublic information about results for a completed quarter or fiscal year, and the announcement must be attached as an exhibit.
The standard deadline, which covers Item 2.02, is four business days, but a report under Item 7.01 made solely to satisfy Regulation FD must meet Regulation FD’s own timing.
Information reported under Items 2.02 and 7.01 is furnished, which keeps it outside Section 18 liability unless the company says otherwise or incorporates it by reference elsewhere.
The earnings call itself needs no separate Item 2.02 report if it meets the four conditions in Item 2.02(b):
- It starts within 48 hours after a related written release that was already furnished on Form 8-K.
- Access is broad, for example through a public dial-in line or webcast.
- Financial and statistical information from the call appears on the company website, along with the disclosures Regulation G requires.
- A widely disseminated press release announced the call, with access instructions and the website location of the information.
Instruction 2 to Item 2.02 also applies the non-GAAP rules in Regulation S-K Item 10(e)(1)(i) to earnings releases.
Furnishing the 8-K minutes after publication, well inside the four-day window, puts the release on EDGAR before analysts dial in.
Recognized channels and the personal account problem
The SEC’s April 2013 report of investigation on Netflix began with a July 3, 2012 Facebook post in which chief executive Reed Hastings said monthly viewing had exceeded 1 billion hours for the first time.
Hastings used his personal page, which had more than 200,000 subscribers, and Netflix issued no press release or Form 8-K about the milestone.
Netflix shares rose from $70.45 at the time of the post to $81.72 at the close of the following trading day.
The Commission brought no case, but it extended its 2008 website guidance, Release 34-58288, to social media, where the central question is whether a company has alerted the market to the channels it will use.
Material information posted on an officer’s personal social media account without advance notice, the report concluded, is unlikely to qualify as broad, non-exclusionary distribution.
Eleven years later, the SEC’s September 2024 order against DraftKings showed how the same problem plays out during an earnings quiet period.
On July 27, 2023, the company’s public relations firm posted on the CEO’s personal X and LinkedIn accounts that DraftKings was “still seeing really strong growth in existing states.”
Staff had approved both posts, and company policy set a quiet period from quarter-end through the first full trading day after its next 10-Q or 10-K.
Within half an hour, communications staff told the firm to take the posts down, yet the company made no public disclosure until its second-quarter earnings release on August 3, 2023.
That delay made the episode a Regulation FD violation, and DraftKings agreed to pay a $200,000 penalty and to train employees with corporate communications duties on the rule.
Deleting a post does not stop the Regulation FD clock, so decide before release week who can authorize a corrective press release or 8-K within hours.
Secure distribution: the window between upload and release
On August 11, 2015, the SEC charged 32 defendants (two hackers and 30 traders) in a scheme to trade on stolen earnings announcements that allegedly produced more than $100 million in illegal profits.
Over a five-year period, according to the SEC, the hackers broke into two or more newswire services and stole hundreds of earnings announcements before release.
In one May 2013 instance, a release cutting earnings and revenue projections sat with a newswire for 36 minutes, and traders who allegedly began shorting the stock 10 minutes after the company sent it realized $511,000 in profits.
Every minute a final release sits in a third party’s system is exposure, so treat the upload time as a control point.
These controls shrink that exposure without slowing the release:
- Keep a named access list for drafts and log every addition to it.
- Circulate drafts through a controlled document system instead of email attachments.
- Designate one approved final version with a version number, and retire superseded copies.
- Ask every vendor who can open an unreleased document and how that access is logged.
- Get written confidentiality commitments from every outside party that sees results early.
- Upload the final version no earlier than the distribution partner’s review process requires.
At The Financial Capital, AI review is instant and human review, when needed, takes zero to five hours, so talk to our team about the upload time before release week.
Release timing: exchange notice rules and trading windows
NYSE and Nasdaq notice requirements
NYSE-listed companies must notify the exchange at least ten minutes before releasing material news between 7:00 a.m. and 4:00 p.m. Eastern Time under Section 202.06 of the NYSE Listed Company Manual.
Nasdaq Rule 5250(b)(1) and IM-5250-1 require at least ten minutes’ notice to Nasdaq MarketWatch before covered material information is released between 7:00 a.m. and 8:00 p.m. ET, and notice before 6:50 a.m. ET for releases outside those hours.
Notice goes through Nasdaq’s electronic disclosure system, and repeated misses can lead to a public reprimand letter or, in extreme cases, a delisting determination.
For a release scheduled after the close, work through this sequence:
- Convert every scheduled time to Eastern Time, including the call, and check the exchange holiday calendar.
- Send the exchange notice in time for whichever deadline applies to your listing.
- Hold the release until the scheduled minute, then confirm it is live on at least one outlet.
- Furnish the Item 2.02 report and open the call only after EDGAR accepts it.
Choosing the hour itself is a separate judgment, covered in our guide to the best time to release financial news.
Once a release is live on trading-focused outlets such as StreetInsider, it cannot be recalled, so the publication time deserves the same sign-off as the numbers.
Rule 10b5-1 and the insider trading window
The SEC adopted its Rule 10b5-1 amendments on December 14, 2022, tightening the conditions for the affirmative defense that pre-planned insider trades rely on.
- Directors and officers must wait until the later of 90 days after adopting a plan or two business days after results for that fiscal quarter appear on Form 10-Q or 10-K, with a 120-day maximum.
- Other plan users, except the company itself, face a 30-day cooling-off period.
- Each director or officer must certify in the plan that they are not aware of material nonpublic information and are adopting it in good faith.
The adopting release notes that an earnings release usually comes before the 10-Q or 10-K, and the cooling-off period for directors and officers is tied to that later report.
It also acknowledges that many issuers keep “closed window” periods restricting insider trades outside Rule 10b5-1 plans, periods that may cover significant portions of the year.
Moving the release date therefore moves the trading calendar, so recheck when the window reopens and whether any plan adoption falls inside a cooling-off period.
Non-GAAP measures and the headline test
SEC staff guidance in Compliance and Disclosure Interpretation 102.10 confirms that the “equal or greater prominence” requirement for GAAP measures applies to earnings releases furnished under Item 2.02.
Its examples of a non-GAAP measure given more prominence than the comparable GAAP measure include:
- Putting a non-GAAP figure before the comparable GAAP figure, or leaving GAAP out, in a headline or caption.
- Setting the non-GAAP number in bold or a larger font.
- Calling a non-GAAP result “record performance” or “exceptional” without an equally prominent description of the GAAP result.
- Charts or tables of non-GAAP measures without GAAP versions of equal or greater prominence.
- Starting the reconciliation with the non-GAAP measure.
- Presenting a non-GAAP income statement.
Headlines deserve their own review, because the staff names them explicitly, so check every headline figure against its GAAP counterpart before sign-off.
Tables and charts face the same test, so pair this rule with our guide to formatting financial tables and charts for media pickup.
Adjectives carry risk too, and the case for plain language in avoiding buzzwords in fintech PR applies with extra force to adjusted numbers.
Getting this wrong has a price: in September 2023, Newell Brands agreed to pay $12.5 million and its former CEO $110,000 over misleading disclosure of a non-GAAP measure called “core sales growth.”
The SEC found that Newell called results “strong” or “solid” in quarters it internally described as disappointing, and the violations included Rule 100(b) of Regulation G.
After the release: analyst calls and investor meetings
Early on July 17, 2017, TherapeuticsMD announced that it did not yet have a clear path forward on its New Drug Application, and its stock fell about 16% in pre-market trading.
Before the market opened, the company called and emailed sell-side analysts with details of its FDA interactions that the press release had left out.
All of the analysts published research notes containing those details, and the stock recovered to close down only 6.6% for the day.
According to the SEC’s August 2019 order, TherapeuticsMD had no Regulation FD policies or procedures at the time, and it agreed to pay a $200,000 penalty.
“The actions allegedly taken by AT&T executives to avoid falling short of analysts’ projections are precisely the type of conduct Regulation FD was designed to prevent.”
Gurbir S. Grewal, Director of the SEC Division of Enforcement, December 5, 2022
Set these rules for the conversations that follow a release:
- Post financial and statistical figures used on the call to the website, one of the Item 2.02(b) conditions for the call.
- Limit one-on-one meetings to authorized spokespeople, with a second company representative present.
- Keep private answers inside the public record created by the release and the call.
- Decline to reaffirm guidance privately, since a late-quarter reaffirmation can signal how the quarter is tracking.
- Escalate any suspected slip to a senior official at once, because the prompt-disclosure clock starts when that person learns of it.
A T-7 to T+1 control timeline
The ten-minute exchange notices and the 48-hour call window in Item 2.02(b) are release-day clocks, but most control work belongs in the week before.
| When | Action | Control |
|---|---|---|
| T-7 days | Confirm the release date and call time, then announce the call with access instructions. | Check both times in Eastern Time against the holiday calendar and the trading window. |
| T-5 days | Freeze the access list for the release and call materials. | Everyone on the list has confidentiality terms in writing. |
| T-3 days | Circulate the near-final draft through the controlled document system. | Finance ties every non-GAAP figure to its GAAP counterpart, starting with the headline. |
| T-2 days | Review the call script and prepared answers against the draft release. | Legal strikes any answer that goes beyond what the release will disclose. |
| T-1 day | Approve one final version with a version number. | Upload only as early as review requires, and confirm the publication time. |
| T-0, before release | Send the exchange notice and hold the release until the scheduled minute. | Two people confirm the version number and the timestamp. |
| T-0, release | Confirm publication, then furnish the Item 2.02 report on Form 8-K. | Verify EDGAR acceptance and post the release on the investor website before the call. |
| T-0, call | Hold the call as announced, with public dial-in or webcast access. | Post any new figures discussed on the call to the website. |
| T+1 day | Resume investor meetings with authorized spokespeople only. | Answers stay inside the public record, and insiders trade only when policy allows. |
This article is general information, not legal advice.
Book the T-7 meeting before the quarter closes, because every control in the table is easier to set up before anyone holds the results.
