In the current climate it is the transparency and rigor of guidance rather than the precise figures that matter most
As public companies are coming off the back of reporting earnings for the March 2025 quarter, it is important to evaluate how best to communicate financial guidance and manage investor expectations in the context of ongoing market volatility and geopolitical disruption.
Key themes that emerged in the March 2025 earnings season
A prevailing theme across reporting companies was the emphasis on visibility – specifically, how clearly organizations can assess the potential impacts of macroeconomic and political developments on their business. Effective mitigation strategies are highly dependent on a company’s unique characteristics, including:
- Business model and operational structure
- Manufacturing footprint (if applicable)
- Geographic distribution of revenue, customers and costs
- Supply chain resilience and flexibility
- Trends in end-market demand and cost inputs.
Given these factors, reporting companies have adopted a range of approaches to financial guidance:
- Withdrawal of guidance: Some companies, unable to quantify the impact of tariffs or anticipate shifts in customer demand, opted to withdraw guidance entirely. Notable examples include Delta, Logitech and Walmart
- Revised guidance: Others adjusted their guidance based on their ability to evaluate current conditions – some revising downward, others upward, with many expanding their forecast ranges to reflect a broader set of potential outcomes
- Reaffirmed guidance with updated context: Certain companies continue to observe strong demand and have reiterated previous guidance. However, they are careful to update the underlying assumptions and provide transparency around any changes from their prior forecasts – even when headline figures remain unchanged.
Strategic communication recommendations
While there is no universal playbook for communicating financial expectations in this environment, we recommend that companies clearly articulate the following:
- Strategic priorities: Define your current business focus – whether it’s customer acquisition, retention, revenue growth, margin protection, or a combination of these – and note any shift from previous priorities
- Available levers: Identify the tools and strategies you are employing to achieve these goals. For example, many manufacturing and industrial companies are revisiting supply chain strategies established during the pandemic, including the use of price indexing in customer contracts
- Foreign exchange (FX) impact: Quantify FX effects where possible, but avoid forecasting future FX movements. Instead, offer scenario-based analyses and sensitivity assessments
- Customer behavior insights: Share your observations regarding customer sentiment, contract signings and their willingness to make forward-looking decisions
- Stable demand drivers: Highlight aspects of your business that remain resilient – or are potentially strengthened – by the current environment
- Segmented guidance (where feasible): If possible, offer a breakdown of guidance with and without the effects of tariffs or other macro impacts. Clarify whether and how FX impacts are factored into your outlook
- Balance-sheet flexibility: Provide an overview of your capital structure, including how currency exposure on outstanding debt affects your financial positioning.
A final thought: Process over precision
Regardless of whether you are revising, reaffirming, or withdrawing guidance, the most critical aspect is not the precise figures, but rather the transparency and rigor behind them. Investors and analysts are looking for a clear explanation of:
- How guidance was developed
- The assumptions and variables that underpin it.
By grounding financial guidance in a thoughtful, well-communicated framework, companies can maintain credibility and foster trust – even amid uncertainty.
Jody Burfening is managing director and Carolyn Capaccio is senior vice president at Alliance Advisors IR
