Does the digital transformation of enterprises affect stock price crash risk?

•The digital transformation of enterprises can reduce stock price crash risk.•There is heterogeneity in the impact of enterprise digital transformation on stock price crash risk.•Digital transformation reduces the information asymmetry between the internal and external firm.•The results are robust to several tests that address endogeneity concerns. This study investigates the effect of enterprise digital transformation on stock price crash risk using a sample of Chinese listed companies during the period 2007–2020. We find that the digital transformation of enterprises can significantly reduce stock price crash risk, and shows a certain structural heterogeneity. The above conclusions still hold after a series of robustness tests. Further, we identify that the relationship is more pronounced in high-tech enterprises and economically developed regions. Overall, the paper can provide empirical evidence for understanding how to reduce stock price crash risk in the capital market, and provide relevant implications for better driving the digital transformation of enterprises.