ABSTRACT
This paper examines the earliest evidence of the Covid-19 pandemic's impact on corporate results. We study the cross-sectional dispersion of corporate revenue and other performance impacts attributed to the pandemic as of the first quarter of 2020. The early business reports on this were mostly accessible through the business press or piecemeal corporate announcements. Market sentiment emerged that associated the spate of individual corporate news items with market-wide steep price declines. The Dow Jones' Index spiked downward, for example, and this was likened to a harbinger of a pandemic-induced crash. The sample is a random selection of public American SEC registrants. Our data is drawn from financial statements they filed with the SEC a short time after those early, informal reports. We examine the notion that the pandemic's immediate impact on revenue across the market in that first quarter of 2020 was pervasive and uniform. The research tracks revenue through to earnings and return on equity (ROE). We test the hypothesis that revenue changes are systematically correlated with a similar change in ROE. We also test the hypothesis that management acted to offset the reporting impacts of the pandemic at this early stage of it. We demonstrate greater cross-sectional diversity in the pandemic's impacts than reported. We demonstrate that revenue changes do not map into similarly systematic earnings and ROE changes. We continue our research into how the pandemic impacts corporate performance beyond these first financials.