CAMBRIDGE, Mass.--(BUSINESS WIRE)--Forrester (Nasdaq: FORR) today announced the full conference agenda for its CX Summit North America event being held in Nashville, Tennessee, and digitally on June 17–20, 2024. According to Forrester, 40% of B2C marketing executives in the US were already exploring generative AI (genAI) use cases at the end of last year, but as business leaders use this technology to improve customer experiences, amplify marketing efforts, and enhance digital properties, they must strike t ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO Commission File Number 000-21433 Forrester Research, Inc. Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark if the Registr ...

Financial Data and Key Metrics Changes - Forrester's overall revenue for Q4 2023 was $118.1 million, a 14% decline from $136.9 million in Q4 2022, and for the full year, revenue was $480.7 million, representing an 11% decline from $537.8 million in 2022 [30][34] - Contract value (CV) declined by 4% in 2023, with a total of $215 million or 66% of CV contracts on the Forrester Decisions platform as of January 1, 2024 [8][33] - Operating income decreased by 47% to $6.8 million in Q4 2023, compared to $12.9 million in Q4 2022, and for the full year, operating income decreased by 25% to $52.3 million [38] Business Line Data and Key Metrics Changes - Research segment CV was $332.1 million at December 31, 2023, a 4% decline from December 2022, primarily due to lower enrichment of retained accounts and additional churn [31] - Consulting business revenues were $28.3 million for Q4 2023 and $118.2 million for the full year, representing declines of 25% and 23% respectively [34] - Events business revenues were $4.6 million in Q4 2023, a 36% decline compared to Q4 2022, driven by a shift in event timing [36] Market Data and Key Metrics Changes - The overall client count decreased from the prior quarter, but Forrester Decisions client count continues to grow, with retention remaining well above overall client retention by approximately 10 points [33] - The company expects both CV and wallet retention to be under pressure in 2024 due to the final year of product transition and a challenging economic environment [33] Company Strategy and Development Direction - Forrester aims to complete the transition of two-thirds of its contract value into the Forrester Decisions platform by the end of 2024, focusing on higher-value clients [4][5] - The company is sharpening its target audience for Forrester Decisions, primarily serving C-level executives in large organizations, which is expected to enhance resilience and scalability [6][7] - The company plans to launch new Forrester Waves focused on the generative AI market in 2024, indicating a strategic pivot towards emerging technologies [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that 2023 was a challenging year due to internal transitions and external macroeconomic factors, but expressed confidence in the long-term benefits of these changes [2][46] - The company anticipates declining revenue in 2024 but aims to control costs to maintain margins and lay a foundation for sustainable growth in 2025 [13][41] - Management believes that 2024 will be an inflection point for Forrester as it completes its product migration and refines its go-to-market strategy [14][46] Other Important Information - The company reduced its workforce by 3% as part of its restructuring plan, which is expected to incur costs of approximately $7.3 million to $7.7 million [41] - Interest expense for Q4 2023 was $0.8 million, an increase from $0.7 million in Q4 2022, driven by higher interest rates [39] Q&A Session Summary Question: How much of the decline for this year is attributed to internal initiatives versus the macro environment? - Management indicated that while internal decisions have impacted short-term performance, the majority of the decline is attributed to external macroeconomic factors, particularly the tech recession [54][62] Question: What is the outlook for generative AI's impact on growth? - Management expressed confidence that generative AI will drive growth, as clients increasingly seek guidance on navigating this technology [65][67] Question: Is there more room for headcount cuts without jeopardizing quality? - Management stated that they believe they are through the majority of labor reductions and intend to preserve resources to support future growth [79] Question: How is the company performing in different regions? - Management noted strong performance in the government sector and indicated that international markets are showing positive signs [98]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (MARK ONE) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934. FOR THE QUARTERLY PERIOD ENDED September 30, 2023 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934. COMMISSION FILE NUMBER: 000-21433 FORRESTER RESEARCH, INC. (Exact name of registrant as specified in its charter) (State or other jurisdiction of incorporation or organization) DELAWA ...

Financial Data and Key Metrics Changes - In Q3, overall revenue decreased by 11% to $113.4 million compared to $127.7 million in the prior year period [11] - Net income and earnings per share decreased by 21% and 23%, respectively, with net income at $8.6 million and earnings per share at $0.44 [38] - Contract value (CV) was flat in Q3, with Forrester Decisions reaching approximately $200 million, representing 57% of overall CV [24][48] Business Line Data and Key Metrics Changes - Research revenues decreased by 7% compared to Q3 2022, with subscription research products down by 1% [12] - Consulting business revenues were $28.2 million, down 24% year-over-year, attributed to clients limiting discretionary spending [15] - Events business revenues increased by 41% to $4.6 million, driven by hosting three events compared to two in the prior year [49] Market Data and Key Metrics Changes - Government clients showed strong traction, with several million-dollar deals closed with U.S. government agencies and significant contracts in APAC and EMEA [6][10] - The overall client retention rate dipped slightly to 73%, while Forrester Decisions client retention remained higher at 85% [12][13] Company Strategy and Development Direction - The company is focused on migrating approximately 2/3 of its CV to Forrester Decisions by the end of the year, with a long-term goal of 80% [53] - Enhancements to Forrester Decisions include the introduction of Izola, a generative AI tool aimed at improving client interactions and research accessibility [29][30] - The company is also simplifying its events portfolio to improve client experience and align with research content [35] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the future despite ongoing macroeconomic headwinds, expecting revenue declines to moderate into next year [41][42] - The uncertain environment is impacting new business growth, particularly in consulting and events, but the company remains on track for its migration plan [14][47] Other Important Information - Operating expenses decreased by 10% due to a restructuring plan, with headcount down 13% compared to the same period in 2022 [50] - The company repurchased approximately $3.3 million worth of shares during the quarter, maintaining a stock repurchase authorization of approximately $71 million [39] Q&A Session Summary Question: Stabilization of CV growth - Management noted that CV growth is expected to be relatively flat in the near term, with some fluctuations [65] Question: Client retention and churn - Client churn is primarily due to shedding non-strategic accounts, with retention rates for Forrester Decisions being approximately 12 points higher than the overall business [69][70] Question: Feedback on Izola - Early feedback on Izola has been overwhelmingly positive, with clients appreciating the ability to quickly access relevant research [86] Question: Sales headcount and strategy - The company is focused on new business development and plans to add back headcount to capture more user clients [101][102] Question: Impact of generative AI - Generative AI is expected to enhance operations and improve client interactions, with Izola being a significant step forward [80][81]

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) Presents Forrester Research, Inc.'s unaudited consolidated financial statements, covering balance sheets, income, comprehensive income, cash flows, and notes [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2023 | December 31, 2022 | Change ($) | Change (%) | | :----------------------------------- | :------------ | :---------------- | :--------- | :--------- | | Total assets | $570,674 | $608,438 | $(37,764) | (6.2%) | | Total liabilities | $339,029 | $386,782 | $(47,753) | (12.4%) | | Total stockholders' equity | $231,645 | $221,656 | $9,989 | 4.5% | - Current assets decreased by **$25.069 million (10.6%)** from $235.290 million at December 31, 2022, to $210.221 million at June 30, 2023, primarily due to decreases in accounts receivable and deferred commissions[10](index=10&type=chunk) - Current liabilities decreased by **$25.860 million (9.6%)** from $269.389 million at December 31, 2022, to $243.529 million at June 30, 2023, mainly driven by a decrease in accrued expenses and other current liabilities[10](index=10&type=chunk) [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Change ($) | Change (%) | | :----------------------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Total revenues | $135,589 | $148,246 | $(12,657) | (8.5%) | | Income from operations | $8,288 | $20,703 | $(12,415) | (60.0%) | | Net income | $5,304 | $13,874 | $(8,570) | (61.8%) | | Diluted income per common share | $0.28 | $0.72 | $(0.44) | (61.1%) | | | | | | | | Metric | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Change ($) | Change (%) | | :----------------------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Total revenues | $249,259 | $273,217 | $(23,958) | (8.8%) | | Income from operations | $3,148 | $27,174 | $(24,026) | (88.4%) | | Net income | $1,229 | $18,022 | $(16,793) | (93.2%) | | Diluted income per common share | $0.06 | $0.94 | $(0.88) | (93.6%) | [Consolidated Statements of Comprehensive Income](index=5&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income) Consolidated Statements of Comprehensive Income Highlights (in thousands) | Metric | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Change ($) | Change (%) | | :----------------------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Net income | $5,304 | $13,874 | $(8,570) | (61.8%) | | Other comprehensive income (loss) | $735 | $(4,489) | $5,224 | 116.4% | | Comprehensive income | $6,039 | $9,385 | $(3,346) | (35.6%) | | | | | | | | Metric | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Change ($) | Change (%) | | :----------------------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Net income | $1,229 | $18,022 | $(16,793) | (93.2%) | | Other comprehensive income (loss) | $1,974 | $(5,671) | $7,645 | 134.8% | | Comprehensive income | $3,203 | $12,351 | $(9,148) | (74.1%) | - Other comprehensive income (loss) significantly improved, moving from a loss of **$(4,489) thousand** in Q2 2022 to a gain of **$735 thousand** in Q2 2023, primarily driven by foreign currency translation adjustments[15](index=15&type=chunk) [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Consolidated Statements of Cash Flows Highlights (in thousands) | Cash Flow Activity | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Change ($) | Change (%) | | :------------------------------------------------ | :----------------------------- | :----------------------------- | :--------- | :--------- | | Net cash provided by operating activities | $15,788 | $34,755 | $(18,967) | (54.6%) | | Net cash provided by (used in) investing activities | $3,444 | $(3,592) | $7,036 | 195.9% | | Net cash used in financing activities | $(15,239) | $(38,290) | $23,051 | (60.2%) | | Net change in cash, cash equivalents and restricted cash | $6,417 | $(12,772) | $19,189 | 150.2% | - Cash, cash equivalents and restricted cash increased by **$6.417 million** for the six months ended June 30, 2023, reaching $112.071 million, a significant improvement from a net decrease of **$(12.772) million** in the prior year period[18](index=18&type=chunk) [Notes to Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) [Note 1 — Interim Consolidated Financial Statements](index=7&type=section&id=Note%201%20%E2%80%94%20Interim%20Consolidated%20Financial%20Statements) Details the basis of presentation for unaudited interim financial statements, GAAP adherence, restricted cash, and recent accounting pronouncements - The unaudited interim consolidated financial statements are prepared in accordance with GAAP for interim financial information and SEC rules for Form 10-Q, with certain footnote disclosures omitted[20](index=20&type=chunk) Cash, Cash Equivalents and Restricted Cash (in thousands) | Metric | Six Months Ended June 30, 2023 | Six Months Ended June 30, 2022 | | :------------------------------------------------ | :----------------------------- | :----------------------------- | | Cash and cash equivalents | $109,951 | $103,225 | | Restricted cash classified in other assets | $2,120 | $2,034 | | Cash, cash equivalents and restricted cash (statement of cash flows) | $112,071 | $105,259 | - Recent accounting pronouncements (ASU No. 2020-04 and 2022-06 on Reference Rate Reform) are **not anticipated to have an impact** on the Company's financial position or results of operations[23](index=23&type=chunk) [Note 2 — Marketable Investments](index=7&type=section&id=Note%202%20%E2%80%94%20Marketable%20Investments) Summarizes marketable investments, including corporate and federal agency obligations, detailing market value, maturity periods, and no realized gains or losses Marketable Investments (in thousands) | Category | June 30, 2023 Market Value | December 31, 2022 Market Value | | :---------------------- | :--------------------------- | :--------------------------- | | Corporate obligations | $11,684 | $17,703 | | Federal agency obligations | $1,980 | $1,985 | | Total | $13,664 | $19,688 | Marketable Investments Maturity Periods as of June 30, 2023 (in thousands) | Category | FY 2023 (remainder) | FY 2024 | FY 2025 | Total | | :---------------------- | :------------------ | :-------- | :-------- | :-------- | | Corporate obligations | $5,953 | $3,832 | $1,899 | $11,684 | | Federal agency obligations | — | $1,980 | — | $1,980 | | Total | $5,953 | $5,812 | $1,899 | $13,664 | - No realized gains or losses on marketable investments were recorded during the three and six months ended June 30, 2023 and 2022[25](index=25&type=chunk) [Note 3 — Goodwill and Other Intangible Assets](index=8&type=section&id=Note%203%20%E2%80%94%20Goodwill%20and%20Other%20Intangible%20Assets) Details goodwill and finite-lived intangible assets, noting unimpaired goodwill and a decrease in net carrying amount of amortized intangibles - The Company performed its annual goodwill impairment testing as of November 30, 2022, and concluded **no impairments existed**. No interim impairment test was required through June 30, 2023[29](index=29&type=chunk) Goodwill Carrying Amount (in thousands) | Metric | Amount | | :------------------------- | :------- | | Balance at December 31, 2022 | $242,149 | | Translation adjustments | $1,138 | | Balance at June 30, 2023 | $243,287 | Finite-Lived Intangible Assets, Net Carrying Amount (in thousands) | Category | June 30, 2023 | December 31, 2022 | | :---------------------- | :------------ | :---------------- | | Customer relationships | $39,766 | $43,981 | | Technology | $1,311 | $2,107 | | Trademarks | $2,329 | $3,416 | | Total | $43,406 | $49,504 | Estimated Intangible Asset Amortization Expense (in thousands) | Year | Amount | | :---------------- | :------- | | 2023 (remainder) | $5,817 | | 2024 | $9,916 | | 2025 | $8,876 | | 2026 | $8,392 | | 2027 | $8,324 | | Thereafter | $2,081 | | Total | $43,406 | [Note 4 — Debt](index=9&type=section&id=Note%204%20%E2%80%94%20Debt) Outlines the $150.0 million revolving credit facility, outstanding balance, interest rate, and compliance with loan covenants - The Company has a **$150.0 million** revolving credit facility maturing in December 2026, with an expansion feature for an additional $50.0 million[32](index=32&type=chunk) Outstanding Borrowings (in thousands) | Description | June 30, 2023 | December 31, 2022 | | :---------------- | :------------ | :---------------- | | Credit facility | $35,000 | $50,000 | - The contractual annualized interest rate as of June 30, 2023, was **6.452%** (SOFR of 5.102% plus a margin of 1.35%). The weighted average annual effective interest rate for the three and six months ended June 30, 2023, was **6.32% and 6.06%**, respectively[38](index=38&type=chunk)[39](index=39&type=chunk) - The Company was in **full compliance** with all restrictive loan covenants as of June 30, 2023, and had **$114.4 million** of available borrowing capacity[33](index=33&type=chunk)[39](index=39&type=chunk) [Note 5 — Leases](index=10&type=section&id=Note%205%20%E2%80%94%20Leases) Details operating leases, associated costs, and ROU asset impairments due to office closures Total Lease Cost (in thousands) | Metric | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Change ($) | Change (%) | | :--------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Total lease cost | $4,439 | $5,046 | $(607) | (12.0%) | | | | | | | | Metric | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Change ($) | Change (%) | | :--------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | Total lease cost | $8,668 | $10,194 | $(1,526) | (15.0%) | - Operating lease ROU assets obtained in exchange for lease obligations increased significantly to **$1.110 million** for the six months ended June 30, 2023, from **$0.172 million** in the prior year period[42](index=42&type=chunk) - During the six months ended June 30, 2023, the Company recorded ROU asset impairments of **$0.8 million** related to closing one floor of its San Francisco office and one other smaller office location[45](index=45&type=chunk) Future Minimum Lease Payments as of June 30, 2023 (in thousands) | Year | Operating Lease Payments | | :----------------------- | :----------------------- | | 2023 (remainder) | $8,133 | | 2024 | $16,184 | | 2025 | $13,920 | | 2026 | $12,336 | | 2027 | $5,713 | | Thereafter | $8,913 | | Total lease payments | $65,199 | [Note 6 – Revenue and Related Matters](index=11&type=section&id=Note%206%20%E2%80%93%20Revenue%20and%20Related%20Matters) Provides disaggregated revenue by geography, contract assets/liabilities, credit loss allowance, and deferred commission amortization, with future revenue expectations Revenue by Geography (in thousands) | Region | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Change ($) | Change (%) | | :------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | North America | $112,006 | $124,177 | $(12,171) | (9.8%) | | Europe | $15,564 | $15,871 | $(307) | (1.9%) | | Asia Pacific | $6,137 | $6,445 | $(308) | (4.8%) | | Other | $1,882 | $1,753 | $129 | 7.4% | | Total | $135,589 | $148,246 | $(12,657) | (8.5%) | | | | | | | | Region | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Change ($) | Change (%) | | :------------- | :----------------------------- | :----------------------------- | :--------- | :--------- | | North America | $204,677 | $226,487 | $(21,810) | (9.6%) | | Europe | $29,276 | $30,343 | $(1,067) | (3.5%) | | Asia Pacific | $11,519 | $13,118 | $(1,599) | (12.2%) | | Other | $3,787 | $3,269 | $518 | 15.8% | | Total | $249,259 | $273,217 | $(23,958) | (8.8%) | - Approximately **$362.2 million** of revenue is expected to be recognized during the next 24 months from remaining performance obligations as of June 30, 2023[52](index=52&type=chunk) Allowance for Expected Credit Losses (in thousands) | Metric | Amount | | :----------------------------- | :------- | | Balance at December 31, 2022 | $560 | | Provision for expected credit losses | $315 | | Write-offs | $(297) | | Balance at June 30, 2023 | $578 | - Amortization expense related to deferred commissions was **$10.4 million** and **$19.0 million** for the three and six months ended June 30, 2023, respectively, a decrease from the prior year periods[54](index=54&type=chunk) [Note 7 — Derivatives and Hedging](index=12&type=section&id=Note%207%20%E2%80%94%20Derivatives%20and%20Hedging) Describes the Company's use of an interest rate swap (matured) and foreign currency forward exchange contracts for hedging, with no outstanding balances - The Company's interest rate swap contract, designated as a cash flow hedge, **matured on December 31, 2022**[55](index=55&type=chunk)[58](index=58&type=chunk) - Foreign currency forward exchange contracts are used to mitigate foreign currency risk, with all contracts entered into during the six months ended June 30, 2023, **settling by period-end**[59](index=59&type=chunk)[60](index=60&type=chunk) Derivative Contracts Impact on Consolidated Statements of Operations (in thousands) | Metric | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | | :-------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | | Interest expense | $0 | $(50) | $0 | $(195) | | Other income (expense), net | $4 | $(93) | $66 | $(176) | | Total | $4 | $(143) | $66 | $(371) | [Note 8 — Fair Value Measurements](index=13&type=section&id=Note%208%20%E2%80%94%20Fair%20Value%20Measurements) Explains the fair value hierarchy for financial assets, classifying money market funds as Level 1 and marketable investments as Level 2 Fair Value Hierarchy for Financial Assets (in thousands) | Category | Level 1 (June 30, 2023) | Level 2 (June 30, 2023) | Total (June 30, 2023) | | :---------------------- | :---------------------- | :---------------------- | :-------------------- | | Money market funds | $5,360 | — | $5,360 | | Marketable investments | — | $13,664 | $13,664 | | Total Assets | $5,360 | $13,664 | $19,024 | | | | | | | Category | Level 1 (Dec 31, 2022) | Level 2 (Dec 31, 2022) | Total (Dec 31, 2022) | | :---------------------- | :---------------------- | :---------------------- | :-------------------- | | Money market funds | $5,800 | — | $5,800 | | Marketable investments | — | $19,688 | $19,688 | | Total Assets | $5,800 | $19,688 | $25,488 | - **No assets or liabilities were transferred** between levels of the fair value hierarchy, and **no changes were made** to valuation techniques for Level 2 assets and liabilities during the six months ended June 30, 2023[69](index=69&type=chunk) [Note 9 — Income Taxes](index=14&type=section&id=Note%209%20%E2%80%94%20Income%20Taxes) Details interim income tax provisions, noting a higher effective tax rate due to share-based awards and a full-year 2023 forecast of 43% Income Tax Expense and Effective Tax Rate (in thousands) | Metric | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | | :------------------ | :----------------------------- | :----------------------------- | | Income tax expense | $1,460 | $8,276 | | Effective tax rate | 54.3% | 31.5% | - The increase in the effective tax rate during the 2023 period was **primarily due to tax expense related to the settlement of share-based awards**[72](index=72&type=chunk) - The Company anticipates its effective tax rate for the full year 2023 will be **approximately 43%**[72](index=72&type=chunk) [Note 10 — Accumulated Other Comprehensive Loss ("AOCL")](index=14&type=section&id=Note%2010%20%E2%80%94%20Accumulated%20Other%20Comprehensive%20Loss%20(%22AOCL%22)) Details Accumulated Other Comprehensive Loss (AOCL) components, showing improvement due to positive foreign currency translation adjustments Accumulated Other Comprehensive Loss (AOCL) (in thousands) | Metric | June 30, 2023 | December 31, 2022 | | :---------------------- | :------------ | :---------------- | | Marketable Investments | $(137) | $(159) | | Translation Adjustment | $(5,807) | $(7,759) | | Total AOCL | $(5,944) | $(7,918) | - Foreign currency translation adjustments contributed **$1.952 million** in comprehensive income for the six months ended June 30, 2023, compared to a loss of **$(5.842) million** in the prior year period[74](index=74&type=chunk) [Note 11 — Net Income Per Common Share](index=15&type=section&id=Note%2011%20%E2%80%94%20Net%20Income%20Per%20Common%20Share) Explains basic and diluted net income per common share calculation, including common stock and common equivalent shares Weighted Average Common Shares Outstanding (in thousands) | Metric | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | | :------------------------------------------ | :----------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | | Basic weighted average common shares outstanding | 19,193 | 18,871 | 19,151 | 18,929 | | Weighted average common equivalent shares | 65 | 302 | 63 | 289 | | Diluted weighted average common shares outstanding | 19,258 | 19,173 | 19,214 | 19,218 | - Options and restricted stock units excluded from diluted weighted average share calculation as anti-dilutive were **706 thousand** for the three months and **657 thousand** for the six months ended June 30, 2023[77](index=77&type=chunk) [Note 12 - Stockholders' Equity](index=16&type=section&id=Note%2012%20-%20Stockholders'%20Equity) Provides a detailed roll-forward of stockholders' equity components, equity plan activity, stock-based compensation, and treasury stock repurchases Total Stockholders' Equity (in thousands) | Metric | June 30, 2023 | December 31, 2022 | | :----------------------- | :------------ | :---------------- | | Total stockholders' equity | $231,645 | $221,656 | Restricted Stock Unit Activity (in thousands, except per share data) | Metric | Number of Shares | Weighted Average Grant Date Fair Value | | :------------------------ | :--------------- | :------------------------------------- | | Unvested at Dec 31, 2022 | 682 | $46.28 | | Granted | 309 | $34.52 | | Vested | (117) | $50.70 | | Forfeited | (86) | $43.55 | | Unvested at June 30, 2023 | 788 | $41.32 | Stock-Based Compensation Expense (in thousands) | Expense Category | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | | :----------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | :----------------------------- | | Cost of services and fulfillment | $2,209 | $2,203 | $4,056 | $4,129 | | Selling and marketing | $807 | $752 | $1,304 | $1,385 | | General and administrative | $844 | $882 | $1,665 | $1,617 | | Total | $3,860 | $3,837 | $7,025 | $7,131 | - During the three and six months ended June 30, 2023, the Company repurchased approximately **27 thousand shares** of common stock at an aggregate cost of approximately **$0.8 million**[84](index=84&type=chunk) [Note 13 — Restructuring and Related Costs](index=19&type=section&id=Note%2013%20%E2%80%94%20Restructuring%20and%20Related%20Costs) Details two significant workforce reductions in 2023, resulting in $12.1 million in restructuring and related costs, including impairments - In January 2023, the Company implemented a **4% workforce reduction**, incurring **$0.6 million** in severance and related costs during Q1 2023, along with a **$0.4 million** incremental impairment to its California office and a **$0.6 million write-off** of a capitalized software project[85](index=85&type=chunk) - In May 2023, the Company implemented an **8% workforce reduction**, recording **$7.5 million** of severance and related costs during Q2 2023. Additionally, **$2.3 million** in restructuring costs were incurred for office closures (including ROU asset impairments and accelerated amortization) and **$0.7 million** in contract termination costs[86](index=86&type=chunk) Restructuring Accrual Activity for May 2023 Action (in thousands) | Metric | Amount | | :------------------------------------ | :------- | | Accrual at December 31, 2022 | $0 | | Additional restructuring and related costs | $10,532 | | Non-cash charge (included above) | $(2,253) | | Cash payments | $(3,299) | | Accrual at June 30, 2023 | $4,980 | [Note 14 — Operating Segments](index=20&type=section&id=Note%2014%20%E2%80%94%20Operating%20Segments) Describes the Company's three operating segments (Research, Consulting, Events), their performance evaluation, and revenue declines due to macroeconomic conditions - The Company operates in three reportable segments: Research, Consulting, and Events, with performance evaluated based on segment revenues and direct expenses[89](index=89&type=chunk)[92](index=92&type=chunk) Segment Revenue and Expense Changes (YoY) | Segment | 3 Months Ended June 30, 2023 Revenue Change | 3 Months Ended June 30, 2023 Expense Change | 6 Months Ended June 30, 2023 Revenue Change | 6 Months Ended June 30, 2023 Expense Change | | :---------------- | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | :------------------------------------------ | | Research | (6%) | (1%) | (7%) | 1% | | Consulting | (19%) | (19%) | (16%) | (16%) | | Events | (8%) | (5%) | (7%) | (5%) | - Consulting segment revenue decrease was primarily due to the **macroeconomic environment** and a policy of **only selling consulting to contract value clients**, except in limited circumstances[135](index=135&type=chunk) [Note 15 — Contingencies](index=21&type=section&id=Note%2015%20%E2%80%94%20Contingencies) Discloses legal proceedings and claims, including a $4.8 million legal settlement accrual, with no expected material adverse effect on financials - The Company accrued **$4.8 million** of expense in the quarter ended March 31, 2023, for a preliminary legal settlement in a wage-related matter, classified in general and administrative expense[95](index=95&type=chunk) - Management believes that the likely results of current legal proceedings and claims are **not expected to have a material adverse effect** on the Company's financial position, results of operations, or cash flows, although the effect could be material to consolidated results for any interim reporting period[97](index=97&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Provides management's perspective on financial condition, operations, revenue, expenses, segment performance, liquidity, and macroeconomic and restructuring impacts [Overview](index=22&type=section&id=Overview) - The Company derives revenues from subscriptions to Research products and services, licensing electronic 'reprints,' performing consulting projects and advisory services, and hosting events[99](index=99&type=chunk) - Primary operating expenses include cost of services and fulfillment, selling and marketing expenses, and general and administrative expenses[100](index=100&type=chunk) Key Business Metrics (dollars in millions) | Metric | As of June 30, 2023 | As of June 30, 2022 | Absolute Change | Percentage Change | | :---------------- | :------------------ | :------------------ | :-------------- | :---------------- | | Contract value | $344.0 | $345.3 | $(1.3) | (0%) | | Client retention | 74% | 76% | (2) points | — | | Wallet retention | 92% | 99% | (7) points | — | | Number of clients | 2,604 | 2,928 | (324) | (11%) | - The decrease in retention rates and number of clients is primarily attributable to **macroeconomic conditions** (funding/budget pressure, high inflation, increasing interest rates, geopolitical turbulence, recession threat) and the **ongoing transition of the client base** to the Forrester Decisions product platform[103](index=103&type=chunk) [Results of Operations](index=24&type=section&id=Results%20of%20Operations) [Revenues](index=24&type=section&id=Revenues) Total Revenues by Segment (dollars in millions) | Revenue Category | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Absolute Change | Percentage Change | | :--------------- | :----------------------------- | :----------------------------- | :-------------- | :---------------- | | Total revenues | $135.6 | $148.2 | $(12.7) | (9%) | | Research revenues | $87.7 | $89.4 | $(1.7) | (2%) | | Consulting revenues | $30.0 | $39.3 | $(9.3) | (24%) | | Events revenues | $17.9 | $19.5 | $(1.6) | (8%) | | | | | | | | Revenue Category | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Absolute Change | Percentage Change | | :--------------- | :----------------------------- | :----------------------------- | :-------------- | :---------------- | | Total revenues | $249.3 | $273.2 | $(24.0) | (9%) | | Research revenues | $168.6 | $175.2 | $(6.6) | (4%) | | Consulting revenues | $61.7 | $77.7 | $(16.0) | (21%) | | Events revenues | $18.9 | $20.3 | $(1.4) | (7%) | - Total revenues decreased **9%** during both the three and six months ended June 30, 2023, compared to the prior year periods, and decreased by **8%** for the six months when excluding foreign currency effects[108](index=108&type=chunk) - Consulting revenues decreased **24%** and **21%** for the three and six months, respectively, due to decreased delivery of advisory and consulting services, influenced by the **macroeconomic environment** and a **focus on contract value clients**[110](index=110&type=chunk) [Cost of Services and Fulfillment](index=25&type=section&id=Cost%20of%20Services%20and%20Fulfillment) Cost of Services and Fulfillment (dollars in millions) | Metric | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Absolute Change | Percentage Change | | :----------------------------- | :----------------------------- | :----------------------------- | :-------------- | :---------------- | | Cost of services and fulfillment | $54.6 | $61.0 | $(6.4) | (10%) | | | | | | | | Metric | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Absolute Change | Percentage Change | | :----------------------------- | :----------------------------- | :----------------------------- | :-------------- | :---------------- | | Cost of services and fulfillment | $103.9 | $114.2 | $(10.3) | (9%) | - The decrease was primarily due to a **$3.8 million** decrease in compensation and benefit costs (lower headcount, incentive bonuses, benefits) for the three months, and a **$4.8 million** decrease for the six months (lower incentive bonuses, benefits, partially offset by higher salaries)[113](index=113&type=chunk)[114](index=114&type=chunk) - Professional services costs decreased by **$1.8 million** for the three months and **$4.5 million** for the six months, mainly due to lower contractor costs, outsourced expenses, and consulting fees[113](index=113&type=chunk)[114](index=114&type=chunk) [Selling and Marketing](index=26&type=section&id=Selling%20and%20Marketing) Selling and Marketing Expenses (dollars in millions) | Metric | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Absolute Change | Percentage Change | | :----------------------------- | :----------------------------- | :----------------------------- | :-------------- | :---------------- | | Selling and marketing expenses | $41.6 | $45.0 | $(3.4) | (8%) | | | | | | | | Metric | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Absolute Change | Percentage Change | | :----------------------------- | :----------------------------- | :----------------------------- | :-------------- | :---------------- | | Selling and marketing expenses | $83.1 | $89.0 | $(5.9) | (7%) | - The decrease was primarily due to a **$3.1 million** decrease in compensation and benefit costs (commissions, headcount, incentive bonuses, benefits) for the three months, and a **$4.7 million** decrease for the six months (commissions, incentive bonuses, benefits)[115](index=115&type=chunk)[116](index=116&type=chunk) [General and Administrative](index=26&type=section&id=General%20and%20Administrative) General and Administrative Expenses (dollars in millions) | Metric | 3 Months Ended June 30, 2023 | 3 Months Ended June 30, 2022 | Absolute Change | Percentage Change | | :----------------------------------- | :----------------------------- | :----------------------------- | :-------------- | :---------------- | | General and administrative expenses | $15.3 | $15.9 | $(0.6) | (4%) | | | | | | | | Metric | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Absolute Change | Percentage Change | | :----------------------------------- | :----------------------------- | :----------------------------- | :-------------- | :---------------- | | General and administrative expenses | $36.5 | $31.4 | $5.1 | 16% | - The six-month increase was primarily due to a **$5.7 million** increase in legal costs, including a **$4.8 million** provision for a preliminary legal settlement for a wage-related matter and related legal services[118](index=118&type=chunk) [Depreciation](index=27&type=section&id=Depreciation) - Depreciation expense was **consistent** during the three and six months ended June 30, 2023, compared to the prior year periods[119](index=119&type=chunk) [Amortization of Intangible Assets](index=27&type=section&id=Amortization%20of%20Intangible%20Assets) - Amortization expense decreased by **$0.3 million** and **$0.6 million** during the three and six months ended June 30, 2023, respectively, compared to the prior year periods due to a decrease in the amortization of a trademark intangible asset[120](index=120&type=chunk) [Restructuring and Related Costs](index=27&type=section&id=Restructuring%20and%20Related%20Costs) - In January 2023, a **4% workforce reduction** was implemented, incurring **$0.6 million** in severance and related costs, a **$0.4 million** impairment to the California office, and a **$0.6 million software write-off**[121](index=121&type=chunk) - In May 2023, an **8% workforce reduction** was implemented, resulting in **$7.5 million** of severance and related costs, **$2.3 million** in restructuring costs for office closures (including ROU asset impairments), and **$0.7 million** in contract termination costs[122](index=122&type=chunk) [Interest Expense](index=27&type=section&id=Interest%20Expense) - Interest expense increased by **$0.2 million** and **$0.4 million** during the three and six months ended June 30, 2023, respectively, compared to the prior year periods, due to an increase in the annualized interest rate on borrowings, partially offset by lower average outstanding borrowings[123](index=123&type=chunk) [Other Income (Expense), Net](index=27&type=section&id=Other%20Income%20(Expense),%20Net) - Other income (expense), net, increased **$0.4 million** and **$1.2 million** during the three and six months ended June 30, 2023, respectively, primarily due to an increase in interest income[124](index=124&type=chunk) [Gain on Investments, Net](index=27&type=section&id=Gain%20on%20Investments,%20Net) - Gain on investments, net, decreased **$0.4 million** during the six months ended June 30, 2023, compared to the prior year period, due to a decrease in investment gains generated by the underlying technology-related investment funds[125](index=125&type=chunk) [Income Tax Expense](index=27&type=section&id=Income%20Tax%20Expense) - Income tax expense decreased by **$6.8 million** during the six months ended June 30, 2023, compared to the prior year period, primarily due to the decrease in income from operations[127](index=127&type=chunk) - The effective tax rate increased to **54%** for the six months ended June 30, 2023, from **31%** in the prior year, primarily due to tax expense related to the settlement of share-based awards[127](index=127&type=chunk) - For the full year 2023, the Company anticipates its effective tax rate will be **approximately 43%**[127](index=127&type=chunk) [Segment Results](index=28&type=section&id=Segment%20Results) - Research segment revenues decreased **6%** and **7%** during the three and six months ended June 30, 2023, respectively, primarily due to **flat Contract Value (CV) growth** and a **decline in revenue from reprint and discontinued products**[133](index=133&type=chunk) - Consulting segment revenues decreased **19%** and **16%** during the three and six months ended June 30, 2023, respectively, primarily due to the **macroeconomic environment** and a **strategic focus on selling consulting only to contract value clients**[135](index=135&type=chunk) - Event segment revenues decreased **8%** and **7%** during the three and six months ended June 30, 2023, respectively, due to a **decrease in sponsorship revenues and event ticket revenue from lower attendance**[137](index=137&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) Cash Flows from Activities (dollars in millions) | Cash Flow Activity | 6 Months Ended June 30, 2023 | 6 Months Ended June 30, 2022 | Change ($) | | :------------------------- | :----------------------------- | :----------------------------- | :--------- | | Operating activities | $15.8 | $34.8 | $(19.0) | | Investing activities | $3.4 | $(3.6) | $7.0 | | Financing activities | $(15.2) | $(38.3) | $23.1 | - The **$19.0 million** decrease in cash provided from operations was primarily due to a **$16.8 million** decrease in net income, the timing of certain benefit payments, and an increase in income tax payments[140](index=140&type=chunk) - Financing activities used **$15.2 million** of cash, primarily for **$15.0 million** in discretionary repayments of the revolving credit facility, **$1.3 million** in taxes related to share settlements, and **$0.8 million** for common stock repurchases[143](index=143&type=chunk) - As of June 30, 2023, the Company had **$123.6 million** in cash, cash equivalents, and marketable investments, with **$90.8 million** held outside the U.S. The remaining stock repurchase authorization was approximately **$74.1 million**[143](index=143&type=chunk)[148](index=148&type=chunk) [Recent Accounting Pronouncements](index=30&type=section&id=Recent%20Accounting%20Pronouncements) - Refer to Note 1 – Interim Consolidated Financial Statements for a full description of recent accounting pronouncements, including expected dates of adoption and effects on results of operations and financial condition[149](index=149&type=chunk) [Critical Accounting Policies and Estimates](index=30&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) - There have been no material changes to the critical accounting policies and estimates previously disclosed in the Annual Report on Form 10-K for the fiscal year ended December 31, 2022[150](index=150&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=31&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Reports no material changes in the Company's market risk sensitivity assessment since the prior Annual Report on Form 10-K - **No material changes** in the assessment of sensitivity to market risk have occurred since the Annual Report on Form 10-K for the year ended December 31, 2022[152](index=152&type=chunk) [Item 4. Controls and Procedures](index=31&type=section&id=Item%204.%20Controls%20and%20Procedures) Details the evaluation of disclosure controls and procedures, confirming effectiveness and no material changes to internal control over financial reporting [Evaluation of Disclosure Controls and Procedures](index=31&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) - Management, including the principal executive officer and principal financial officer, concluded that the Company's disclosure controls and procedures were **effective as of June 30, 2023**, to provide reasonable assurance of achieving desired control objectives[153](index=153&type=chunk) [Changes in Internal Control Over Financial Reporting](index=31&type=section&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) - There was **no change** in the Company's internal control over financial reporting that occurred during the quarter ended June 30, 2023, which has materially affected, or is reasonably likely to materially affect, internal control over financial reporting[154](index=154&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=32&type=section&id=Item%201.%20Legal%20Proceedings) Incorporates legal proceedings and contingencies information by reference from Note 15 of Part I, Item 1 - Information regarding legal proceedings is **incorporated by reference** from Note 15 - Contingencies in Part I, Item 1 of this Quarterly Report[156](index=156&type=chunk) [Item 1A. Risk Factors](index=32&type=section&id=Item%201A.%20Risk%20Factors) Refers to risk factors from the Annual Report on Form 10-K, noting their continued applicability and potential for additional unknown risks - The risk factors described in the Annual Report on Form 10-K for the year ended December 31, 2022, **remain applicable** to the Company's business[157](index=157&type=chunk) - Additional risks and uncertainties not currently known or deemed immaterial may also **materially adversely affect** the business, financial condition, and/or operating results[157](index=157&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=32&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Details the stock repurchase program, including shares repurchased during Q2 2023 and remaining authorization - The Board of Directors authorized an aggregate **$585.0 million** for common stock repurchases under its stock repurchase program[158](index=158&type=chunk) Common Stock Repurchases During Q2 2023 | Period | Total Number of Shares Purchased | Average Price Paid per Share ($) | Maximum Approximate Dollar Value of Shares Yet to be Purchased (In thousands) | | :---------------- | :------------------------------- | :------------------------------- | :-------------------------------------------------------------------------- | | June 1 - June 30 | 27,500 | $29.82 | $74,146 | - As of June 30, 2023, approximately **$74.1 million** remained authorized for stock repurchases[158](index=158&type=chunk) [Item 3. Defaults Upon Senior Securities](index=32&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) This item is not applicable to the Company for the current reporting period - **Not applicable**[159](index=159&type=chunk) [Item 4. Mine Safety Disclosures](index=32&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the Company for the current reporting period - **Not applicable**[160](index=160&type=chunk) [Item 5. Other Information](index=32&type=section&id=Item%205.%20Other%20Information) Reports no director or officer adopted or terminated Rule 10b5-1 or non-Rule 10b5-1 trading arrangements during Q2 2023 - **No director or officer adopted or terminated** a Rule 10b5-1 or non-Rule 10b5-1 trading arrangement during the three months ended June 30, 2023[161](index=161&type=chunk) [Item 6. Exhibits](index=33&type=section&id=Item%206.%20Exhibits) Lists all exhibits filed with Form 10-Q, including organizational documents, officer certifications, and Inline XBRL documents - Exhibits include Restated Certificate of Incorporation, Amended and Restated By-Laws, Specimen Certificate for Common Stock, **Certifications of the Principal Executive Officer and Principal Financial Officer** (31.1, 31.2, 32.1, 32.2), and various Inline XBRL documents (101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104)[164](index=164&type=chunk) SIGNATURES [Signatures](index=34&type=section&id=SIGNATURES_details) Formally attests that the Quarterly Report on Form 10-Q has been duly signed by Forrester Research, Inc.'s Chief Financial Officer - The report was **signed by L. Christian Finn, Chief Financial Officer** of Forrester Research, Inc., on August 9, 2023[168](index=168&type=chunk)

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Forrester Research, Inc. (NASDAQ:FORR) Q2 2023 Earnings Conference Call July 27, 2023 4:30 PM ET Company Participants Ed Bryce Morris - Vice President, Corporate Development and Investor Relations George Colony - Chief Executive Officer and Chairman Chris Finn - Chief Financial Officer Carrie Johnson - Chief Product Officer Nate Swan - Chief Sales Officer Conference Call Participants Anja Soderstrom - Sidoti Vince Colicchio - Barrington Research Operator Good afternoon and thank you for standing by. Welcome ...

PART I FINANCIAL INFORMATION [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) For the first quarter of 2023, Forrester Research reported a net loss of $4.1 million, a significant reversal from the $4.1 million net income in the same period of 2022, driven by a 9% year-over-year decline in total revenues to $113.7 million [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) As of March 31, 2023, total assets slightly decreased to $593.9 million, mirrored by a reduction in total liabilities to $371.1 million, primarily due to lower long-term debt | | March 31, 2023 (In thousands) | December 31, 2022 (In thousands) | | :--- | :--- | :--- | | **Total current assets** | $225,844 | $235,290 | | **Total assets** | $593,888 | $608,438 | | **Total current liabilities** | $269,305 | $269,389 | | **Long-term debt** | $35,000 | $50,000 | | **Total liabilities** | $371,142 | $386,782 | | **Total stockholders' equity** | $222,746 | $221,656 | - Cash and cash equivalents remained stable at approximately **$104.2 million** as of March 31, 2023[10](index=10&type=chunk) [Consolidated Statements of Operations](index=4&type=section&id=Consolidated%20Statements%20of%20Operations) The company reported a net loss of $4.1 million for Q1 2023, a reversal from prior-year net income, primarily due to a 9% decrease in total revenues to $113.7 million | Metric (In thousands, except per share data) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | **Total revenues** | $113,670 | $124,971 | | Research | $80,906 | $85,780 | | Consulting | $31,750 | $38,431 | | **Total operating expenses** | $118,810 | $118,500 | | **Income (loss) from operations** | $(5,140) | $6,471 | | **Net income (loss)** | $(4,075) | $4,148 | | **Diluted income (loss) per common share** | $(0.21) | $0.22 | - The company incurred **$1.6 million** in restructuring costs during Q1 2023, which were not present in the same period of 2022[12](index=12&type=chunk) [Consolidated Statements of Cash Flows](index=6&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities significantly decreased to $12.3 million in Q1 2023, while financing activities included a $15.0 million debt repayment, resulting in a slight overall cash increase | Cash Flow Activity (In thousands) | Three Months Ended March 31, 2023 | Three Months Ended March 31, 2022 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $12,282 | $22,666 | | **Net cash provided by (used in) investing activities** | $1,342 | $(1,912) | | **Net cash used in financing activities** | $(14,239) | $(22,737) | | **Net change in cash, cash equivalents and restricted cash** | $634 | $(3,336) | - Financing activities in Q1 2023 included a **$15.0 million** payment on borrowings, while Q1 2022 also included **$9.5 million** in common stock repurchases not present in Q1 2023[18](index=18&type=chunk) [Notes to Consolidated Financial Statements](index=7&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes detail stable goodwill, a reduction in outstanding debt to $35 million, a $1.6 million restructuring charge in Q1 2023, and a subsequent 8% workforce reduction in May 2023 - As of March 31, 2023, the company had **$35.0 million** in outstanding borrowings under its credit facility, a decrease from **$50.0 million** at the end of 2022[36](index=36&type=chunk) - In January 2023, the company implemented a workforce reduction of approximately **4%**, recording **$0.6 million** in related costs, alongside an additional **$1.0 million** restructuring charge for office closure and a software write-off[78](index=78&type=chunk)[79](index=79&type=chunk) - Subsequent to the quarter's end, in May 2023, the company initiated another workforce reduction of approximately **8%** and office closures, with anticipated total costs of **$10.0 million to $11.0 million**[88](index=88&type=chunk) - Following an April 2023 mediation, the company accrued **$4.8 million** for a wage-related matter, classified under general and administrative expenses for the quarter[85](index=85&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=19&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the 9% revenue decline and weakened performance to macroeconomic conditions and product transition, with Contract Value flat but wallet retention significantly dropping to 92% [Key Metrics](index=20&type=section&id=Key%20Metrics) As of March 31, 2023, key performance metrics showed pressure with Contract Value flat, but client and wallet retention declining, and client numbers decreasing by 9% | Metric | As of March 31, 2023 | As of March 31, 2022 | Change | | :--- | :--- | :--- | :--- | | **Contract value** | $347.3 M | $347.3 M | 0% | | **Client retention** | 74% | 77% | (3) points | | **Wallet retention** | 92% | 103% | (11) points | | **Number of clients** | 2,678 | 2,945 | (9%) | - The decrease in retention rates and client numbers is attributed to macroeconomic pressures on technology clients and the ongoing transition to the Forrester Decisions product platform[94](index=94&type=chunk) [Results of Operations](index=22&type=section&id=Results%20of%20Operations) Total revenues decreased by 9% to $113.7 million in Q1 2023, with Research and Consulting revenues falling, while general and administrative expenses surged 37% due to a $4.8 million legal settlement provision | Revenue Type (in millions) | Q1 2023 | Q1 2022 | % Change | | :--- | :--- | :--- | :--- | | **Total revenues** | $113.7 | $125.0 | (9%) | | Research revenues | $80.9 | $85.8 | (6%) | | Consulting revenues | $31.8 | $38.4 | (17%) | - General and administrative expenses increased by **$5.7 million (37%)** year-over-year, mainly due to a **$4.8 million** provision for a preliminary legal settlement for a wage-related matter[104](index=104&type=chunk) [Segment Results](index=24&type=section&id=Segment%20Results) The Research segment experienced an 8% revenue decrease, while Consulting revenue declined 13% due to lower demand for content marketing and strategy consulting offerings amid challenging macroeconomic conditions | Segment (Q1 2023 vs Q1 2022) | Revenue Change | Expense Change | | :--- | :--- | :--- | | **Research** | (8%) | +4% | | **Consulting** | (13%) | (14%) | | **Events** | +33% | (7%) | - The decline in Consulting segment revenue was primarily due to lower demand for content marketing and strategy consulting offerings[118](index=118&type=chunk) [Liquidity and Capital Resources](index=25&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a solid liquidity position with $121.0 million in cash and investments, despite a decrease in cash from operations, and made a $15.0 million discretionary debt repayment - Cash generated from operating activities was **$12.3 million** for Q1 2023, a decrease from **$22.7 million** in Q1 2022, primarily due to lower net income and timing of benefit payments[121](index=121&type=chunk) - The company used **$14.2 million** in financing activities, mainly for a **$15.0 million** repayment of its revolving credit facility[124](index=124&type=chunk) - As of March 31, 2023, the company had cash, cash equivalents, and marketable investments of **$121.0 million** and believes this is sufficient to meet its needs for the next twelve months[129](index=129&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=26&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company reported no material changes to its market risk disclosures since its Annual Report on Form 10-K for the year ended December 31, 2022 - There have been no material changes in the company's assessment of its sensitivity to market risk from what was disclosed in the 2022 Form 10-K[133](index=133&type=chunk) [Item 4. Controls and Procedures](index=26&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of March 31, 2023, with no material changes to internal control over financial reporting during the quarter - The principal executive officer and principal financial officer concluded that the company's disclosure controls and procedures were effective as of March 31, 2023[134](index=134&type=chunk) - No changes occurred during the quarter that materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[135](index=135&type=chunk) PART II OTHER INFORMATION [Item 1. Legal Proceedings](index=27&type=section&id=Item%201.%20Legal%20Proceedings) The company accrued $4.8 million in Q1 2023 for a wage-related matter that reached an agreement in principle during an April 2023 mediation - The company accrued **$4.8 million** in Q1 2023 for a wage-related matter that reached an agreement in principle during an April 2023 mediation[85](index=85&type=chunk)[138](index=138&type=chunk) [Item 1A. Risk Factors](index=27&type=section&id=Item%201A.%20Risk%20Factors) The company states that the risk factors previously disclosed in its 2022 Annual Report on Form 10-K remain applicable and have not materially changed - There are no new risk factors presented; the company directs investors to the risk factors discussed in its 2022 Annual Report on Form 10-K[139](index=139&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=27&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Forrester did not repurchase any shares of its common stock under its authorized stock repurchase program during the first quarter of 2023 - The company did not purchase any of its common stock under the stock repurchase program during the quarter ended March 31, 2023[140](index=140&type=chunk) [Item 6. Exhibits](index=28&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q, including amendments to credit agreements, CEO and CFO certifications, and interactive data files - Key exhibits filed include the Second Amendment to the Credit Agreement and certifications from the Principal Executive Officer and Principal Financial Officer[146](index=146&type=chunk)

Forrester Research, Inc. (NASDAQ:FORR) Q1 2023 Earnings Conference Call May 4, 2023 4:30 PM ET Company Participants Tyson Seely - Vice President of Investor Relations George Colony - Chief Executive Officer and Chairman Nate Swan - Chief Sales Officer Chris Finn - Chief Financial Officer Carrie Johnson - Chief Product Officer Conference Call Participants Andrew Nicholas - William Blair Anja Soderstrom - Sidoti Vincent Colicchio - Barrington Research Operator Good afternoon, and thank you for standing by. We ...