Core Insights - Gartner's stock experienced a significant decline of 30.3% this week, contrasting with gains in the S&P 500 and Nasdaq-100 [1] - The company's Q2 earnings met Wall Street expectations, reporting earnings per share (EPS) of $3.11 on sales of $1.7 billion, alongside a stock repurchase of $274 million [2][3] - Concerns arise from a slowdown in contract growth, with total contract value increasing by only 4.9% year over year, indicating potential challenges for future growth [4] Company Developments - Gartner introduced an AI-powered research tool named "AskGartner," aimed at enhancing client support and addressing the growing demand for AI solutions [5] - The effectiveness of the "AskGartner" tool remains uncertain, especially as competition intensifies from AI-first companies and internal tools developed by other firms [5] - The company's stock is trading at one of its lowest multiples in decades, reflecting the adverse impact of AI trends and broader market conditions on its business model [6]

Core Viewpoint - Gartner's stock experienced a significant decline of 28% on August 5, 2025, resulting in a loss of half its market value since the start of the year, primarily due to disappointing revenue guidance despite beating revenue and growth expectations in its second quarter earnings report [2][3][8]. Financial Performance - Gartner reported second quarter 2025 revenue of $1.7 billion, reflecting a 5.7% increase and slightly exceeding Zacks Consensus Estimate [16]. - Adjusted earnings per share for Q2 were $3.53, up 9.6% and 4.4% above Zacks Consensus Estimate [16]. - The 2025 revenue forecast is $6.46 billion, which is $110 million below Zacks Consensus Estimate [16]. - Adjusted earnings per share guidance for 2025 is $11.75, which is 90 cents below Zacks Consensus Estimate [16]. Growth Challenges - The company significantly lowered its growth forecast for its core Insights business line, with contract value growth expectations dropping from 5.1% to 2.5%, which shocked investors and led to a downgrade by UBS [9][10]. - Management attributed the slowdown to macroeconomic pressures and client spending constraints, with clients reducing discretionary spending on IT research and advisory services [10][11]. - The rise of AI tools has led clients to develop in-house capabilities, reducing their reliance on Gartner's consulting and research services [11][12]. Management and Strategy Issues - During the investor conference call, Gartner's executives did not address competitive disadvantages or market share losses, which frustrated investors [4][12][13]. - The company's cultural barriers, including an elitist mentality and a high-pressure sales culture, may hinder its ability to adapt and implement necessary strategic changes [4][14][17]. - Gartner's management has been criticized for failing to provide a compelling vision for restoring growth in light of changing customer needs and competitive strategies [13][15]. Future Outlook - Wall Street analysts have set an average 12-month price target of $453.63 for Gartner, indicating an 86% upside potential [15]. - To revive growth, Gartner must shift its business model to promote client self-reliance, integrate AI into its services, and focus on specific areas of expertise rather than competing as a generalist [17].

Group 1 - Gartner, Inc. has been downgraded to a sell rating due to concerns over weak government IT spending [1] - The company provided weak guidance for FY25, leading to a 27% drop in its stock price [1] Group 2 - No investment positions or plans to initiate positions in Gartner, Inc. have been disclosed by the analyst [1]

Core Insights - Gartner, Inc. reported second-quarter 2025 results with earnings and revenues exceeding the Zacks Consensus Estimate, with adjusted earnings per share of $3.53, beating estimates by 4.4% and increasing 9.6% year-over-year. Revenues reached $1.7 billion, surpassing the consensus estimate and improving 5.7% year-over-year [1][9]. Revenue Performance - The Insights segment generated revenues of $1.3 billion, reflecting a 4.2% increase year-over-year on a reported basis and 4.1% on a foreign-currency-neutral basis, with a gross contribution margin of 74.5% [3]. - Consulting segment revenues were $135 million, growing 6% year-over-year on a reported basis and 6.9% on a foreign-currency-neutral basis, with a gross contribution margin of 40.3% [4]. - Conference revenues amounted to $70 million, an 8.4% year-over-year increase on a reported basis and 8.5% on a foreign-currency-neutral basis, with a gross contribution margin of 33.2% [4]. Operating Performance - Adjusted EBITDA for the quarter was $382 million, showing a slight increase from the previous year on a reported basis and a 5% increase on a foreign-currency-neutral basis [5]. Financial Position - At the end of the quarter, Gartner had $2.2 billion in cash and cash equivalents, up from $2 billion in the previous quarter. Long-term debt remained flat at $2.5 billion [6]. - Operating cash flow totaled $384 million, with free cash flow utilized at $347 million, and capital expenditure was $36 million [6]. 2025 Guidance - Gartner has lowered its total revenue guidance for 2025 to at least $6.46 billion, down from the previous estimate of $6.54 billion, which is also below the Zacks Consensus Estimate of $6.57 billion [7]. - The company raised its adjusted earnings per share guidance to at least $11.75, compared to the previous estimate of $11.70, but this is still below the Zacks Consensus Estimate of $12.65 [7]. - Adjusted EBITDA guidance has been lowered to at least $1.52 billion from $1.53 billion, while free cash flow guidance remains at least $1.15 billion [8].

The RSI reading of 25.23 for IT is an indication that the heavy selling could be in the process of exhausting itself, so the stock could bounce back in a quest for reaching the old equilibrium of supply and demand. The RSI value is not the only factor that indicates a potential turnaround for the stock in the near term. On the fundamental side, there has been strong agreement among the sell-side analysts covering the stock in raising earnings estimates for the current year. Over the last 30 days, the consen ...

Financial Data and Key Metrics Changes - Second quarter contract value (CV) grew 5% year over year, with revenue at $1.7 billion, up 6% year over year as reported and 5% FX neutral [24][26] - Adjusted EPS was $3.53, up 10% from Q2 of last year, and free cash flow was $347 million, reflecting strong performance [27][41] - Total contribution margin was 68%, up 70 basis points from last year, and EBITDA was $443 million, up 7% as reported and 5% FX neutral [26][37] Business Line Data and Key Metrics Changes - Insights revenue grew 4% year over year as reported and 3% FX neutral, with subscription revenue growing 5% FX neutral [27] - Global Technology Sales (GTS) contract value was $3.8 billion, up 4% year over year, while Global Business Sales (GBS) contract value was $1.2 billion, up 9% year over year [31][33] - Conferences revenue increased 14% as reported and 12% FX neutral compared to 2024, with consulting revenue at $156 million, up about 9% as reported [34][35] Market Data and Key Metrics Changes - CV growth was broad-based across practices, industry sectors, company sizes, and geographic regions, with energy, banking, transportation, and healthcare leading the growth [30] - Excluding the US federal government, CV growth was about 150 basis points faster at around 6% [28] - Dollar retention year to date was around 47%, with approximately $200 million of US federal CV [31] Company Strategy and Development Direction - The company is focusing on AI as a significant opportunity and is adapting to ensure a clear path back to double-digit growth [6][22] - The research segment has been renamed to business and technology insights to better reflect the value provided to clients [21] - The company is enhancing its capabilities in cost optimization and AI, including the rollout of Ask Gartner, an AI-powered tool for clients [14][15] Management's Comments on Operating Environment and Future Outlook - Management noted headwinds from declining CEO confidence and cost-cutting measures among clients, particularly in tariff-affected industries [8][10] - The company is confident in its ability to adapt and respond to changes, particularly in the US federal government sector [11][12] - Future growth is expected to be driven by the renewal of federal contracts and stabilization in tariff-affected industries [53][54] Other Important Information - The company has increased its share repurchase program, buying back approximately $720 million year to date [25][43] - The updated guidance for 2025 includes expectations for insights revenue of at least $5.255 billion, with FX neutral growth of about 2% [47][49] - The company maintains a strong balance sheet with $2.9 billion of liquidity and low levels of leverage [43] Q&A Session Summary Question: Can you size the tariff-impacted industries and their CV representation? - The company estimates that around 35% to 40% of its CV falls into tariff-impacted industries [61] Question: What are the common client questions regarding AI and operational efficiency? - Clients seek help with mission-critical priorities, such as cybersecurity and leveraging AI, which require significant investment and effort [69][70] Question: How are new purchases among government clients performing? - New business is being written, but the contracting process is complex, leading to challenges in growth [84]

Financial Data and Key Metrics Changes - Second quarter contract value (CV) grew 5% year over year, with revenue at $1.7 billion, up 6% year over year as reported and 5% FX neutral [23][25] - Adjusted EBITDA was $443 million, up 7% as reported and 5% FX neutral compared to the previous year [25][36] - Adjusted EPS increased to $3.53, reflecting a 10% rise from Q2 of last year [26][38] - Free cash flow for the quarter was $347 million, up 2% compared to Q2 in 2024 [39][48] Business Line Data and Key Metrics Changes - Insights revenue grew 4% year over year as reported and 3% FX neutral, with subscription revenue increasing by 5% FX neutral [26][27] - Global Technology Sales (GTS) contract value was $3.8 billion, up 4% year over year, while Global Business Sales (GBS) contract value reached $1.2 billion, up 9% year over year [29][31] - Conference revenue increased by 14% as reported and 12% FX neutral, while consulting revenue was $156 million, up about 9% as reported [33][34] Market Data and Key Metrics Changes - CV growth was broad-based across practices, industry sectors, company sizes, and geographic regions, with energy, banking, transportation, and healthcare leading the growth [28] - Excluding the US federal government, CV growth was approximately 6%, with positive NCVI of $13 million [27][28] - Dollar retention year to date was around 47%, with approximately $200 million of US federal CV [29][30] Company Strategy and Development Direction - The company is focusing on AI as a significant opportunity and is adapting to ensure a clear path back to double-digit growth [5][21] - The research segment has been renamed to business and technology insights to better reflect the value provided to clients [20][26] - The company is enhancing its capabilities in cost optimization and supply chain reconfiguration due to tariff changes [10][12] Management's Comments on Operating Environment and Future Outlook - Management noted headwinds from declining CEO confidence and cost-cutting measures among clients, particularly in tariff-affected industries [7][8] - The company expects to return to double-digit growth by addressing operational changes and leveraging AI tools [49][55] - The updated guidance reflects continued challenges in the selling environment, but there is high visibility into subscription revenue for 2025 [42][43] Other Important Information - The company has increased its share repurchase program, buying back approximately $720 million year to date [24][41] - The expected free cash flow for 2025 is at least $1.145 billion, reflecting a conversion from GAAP net income of 141% [48] Q&A Session Summary Question: Can you size the tariff-impacted industries and their CV representation? - Approximately 35% to 40% of CV falls into tariff-impacted industries across both GTS and GBS [59] Question: What are the common AI-related questions from clients? - Clients seek help with mission-critical priorities such as cybersecurity and leveraging AI within their organizations [67][68] Question: How is new business performing among government clients? - New business is being written, but the contracting process is complex, leading to challenges in growth [81][83] Question: What is the impact of tariffs on GTS and GBS? - GBS is likely more reliant on tariff-affected clients due to its focus on supply chain practices [85] Question: How is the company addressing AI's potential impact on service demand? - The company is focused on demonstrating the unique value of its insights and services, which are complex and multi-year in nature [110][112]

Group 1 - U.S. stock futures are higher, with Dow futures gaining around 0.1% [1] - Inspire Medical Systems, Inc. shares fell 25% to $98.00 in pre-market trading after reporting second-quarter results and cutting FY25 guidance below estimates [1] - Ichor Holdings, Ltd. declined 24.3% to $15.24 in pre-market trading due to worse-than-expected second-quarter adjusted EPS results and below-estimate third-quarter adjusted EPS guidance [3] Group 2 - Gartner, Inc. shares fell 15% to $287.20 after issuing soft FY25 guidance [3] - Vertex Pharmaceuticals Incorporated declined 14.5% to $403.85 following second-quarter financial results and Vx-993 Phase 2 trial results [3] - Semrush Holdings, Inc. fell 14.1% to $7.91 after reporting a second-quarter EPS miss [3] - Navitas Semiconductor Corporation shares dropped 14.1% to $6.92 after issuing third-quarter sales guidance below estimates [3] - Kyndryl Holdings, Inc. fell 12.2% to $32.21 after reporting a first-quarter revenue miss [3]

Q2 2025 Financial Performance - Consolidated revenues reached $1686 million, a 5.7% increase year-over-year, or 4.6% on a foreign exchange (FX) neutral basis[6] - Insights revenues grew by 4.2% to $1319 million, or 3.3% on an FX neutral basis, with a contribution margin of 73.9%[6] - Conference revenues increased by 13.6% to $211 million, or 12.0% on an FX neutral basis, boasting a contribution margin of 57.4%[6] - Consulting revenues rose by 8.8% to $156 million, or 6.5% on an FX neutral basis, with a contribution margin of 39.6%[6] - Adjusted EBITDA increased by 6.6% to $443 million, with an Adjusted EBITDA margin of 26.3%[6] - Adjusted EPS grew by 9.6% to $3.53[6] - Free cash flow was $347 million[6] Contract Value Growth - Global contract value (CV) increased by 4.9%[6] - Global Technology Sales CV grew by 3.6% to $3800 million[6] - Global Business Sales CV increased by 9.2% to $1200 million[6] Updated 2025 Guidance - The company projects consolidated revenues of at least $6455 billion[7] - Adjusted EBITDA is expected to be at least $1515 billion[7] - Adjusted EPS is projected to be at least $11.75[7] - Free cash flow is anticipated to be at least $1145 billion[7]

PART I. FINANCIAL INFORMATION [ITEM 1. FINANCIAL STATEMENTS (Unaudited)](index=3&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS%20(Unaudited)) This section presents Gartner's unaudited condensed consolidated financial statements, including balance sheets, statements of operations, comprehensive income, changes in stockholders' equity, and cash flows, along with detailed notes explaining business operations, accounting policies, segment performance, debt, equity, and other financial disclosures for the periods ended June 30, 2025 and 2024 [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets%20at%20June%2030%2C%202025%20and%20December%2031%2C%202024) Condensed Consolidated Balance Sheet Highlights | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :-------------------------- | :----------------------------- | :------------------------------- | | Cash and cash equivalents | $2,197,536 | $1,933,147 | | Fees receivable, net | $1,263,163 | $1,696,225 | | Total current assets | $3,973,959 | $4,196,531 | | Total Assets | $8,327,787 | $8,534,671 | | Deferred revenues | $2,691,487 | $2,762,927 | | Total current liabilities | $3,593,764 | $3,969,016 | | Total Liabilities | $6,795,161 | $7,175,502 | | Total Stockholders' Equity | $1,532,626 | $1,359,169 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) Condensed Consolidated Statements of Operations Highlights **Three Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------- | :------------------ | :------------------ | | Revenues: Insights | $1,319,453 | $1,265,992 | | Revenues: Conferences | $211,407 | $186,084 | | Revenues: Consulting | $155,594 | $142,984 | | Total revenues | $1,686,454 | $1,595,060 | | Operating income | $327,096 | $318,783 | | Net income | $240,783 | $229,548 | | Diluted EPS ($) | $3.11 | $2.93 | **Six Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------- | :------------------ | :------------------ | | Revenues: Insights | $2,641,280 | $2,534,164 | | Revenues: Conferences | $284,004 | $256,153 | | Revenues: Consulting | $295,300 | $277,669 | | Total revenues | $3,220,584 | $3,067,986 | | Operating income | $605,128 | $592,668 | | Net income | $451,722 | $440,093 | | Diluted EPS ($) | $5.82 | $5.60 | [Condensed Consolidated Statements of Comprehensive Income](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) Condensed Consolidated Statements of Comprehensive Income Highlights **Three Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | | :------------------------------------ | :------------------ | :------------------ | | Net income | $240,783 | $229,548 | | Other comprehensive income (loss), net | $21,234 | $733 | | Comprehensive income | $262,017 | $230,281 | **Six Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | | :------------------------------------ | :------------------ | :------------------ | | Net income | $451,722 | $440,093 | | Other comprehensive income (loss), net | $41,718 | $(5,322) | | Comprehensive income | $493,440 | $434,771 | [Condensed Consolidated Statements of Changes in Stockholders' Equity](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Stockholders'%20Equity%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) Changes in Stockholders' Equity | Metric | Balance at Dec 31, 2024 (in thousands) | Balance at June 30, 2025 (in thousands) | | :-------------------------- | :----------------------------------- | :---------------------------------- | | Total Stockholders' Equity | $1,359,169 | $1,532,626 | **Six Months Ended June 30, 2025:** * Net income: **$451,722** * Other comprehensive income: **$41,718** * Common share repurchases (including excise tax): **$(430,704)** * Stock-based compensation expense: **$93,195** [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows%20for%20the%20Six%20Months%20Ended%20June%2030%2C%202025%20and%202024) Condensed Consolidated Statements of Cash Flows Highlights (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------------------------------- | :------------------ | :------------------ | | Cash provided by operating activities | $697,077 | $558,800 | | Cash used in investing activities | $(61,817) | $(54,027) | | Cash used in financing activities | $(419,688) | $(553,229) | | Net increase (decrease) in cash and cash equivalents | $215,572 | $(48,456) | | Cash and cash equivalents, end of period | $2,197,536 | $1,235,785 | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [Note 1 — Business and Basis of Presentation](index=8&type=section&id=Note%201%20%E2%80%94%20Business%20and%20Basis%20of%20Presentation) * Gartner, Inc. delivers actionable, objective business and technology insights through three segments: **Business and Technology Insights** (renamed from Research in Q2 2025), **Conferences**, and **Consulting**[16](index=16&type=chunk)[17](index=17&type=chunk) * The Company adopted ASU 2023-07 (Segment Reporting) in 2024, which only impacted disclosures and had **no effect on financial results, cash flows, or financial condition**[26](index=26&type=chunk) * Future accounting standards ASU 2023-09 (Income Taxes) and ASU 2024-03 (Income Statement) are expected to impact disclosures but **not the Company's results of operations, cash flows, or financial condition**[28](index=28&type=chunk)[29](index=29&type=chunk) [Note 2 — Goodwill and Intangible Assets](index=9&type=section&id=Note%202%20%E2%80%94%20Goodwill%20and%20Intangible%20Assets) Goodwill Carrying Amount by Segment | Segment | Balance at Dec 31, 2024 (in thousands) | Foreign Currency Translation Impact (in thousands) | Balance at June 30, 2025 (in thousands) | | :-------------- | :----------------------------------- | :----------------------------------------- | :---------------------------------- | | Insights | $2,650,981 | $6,405 | $2,657,386 | | Conferences | $183,920 | $105 | $184,025 | | Consulting | $95,304 | $991 | $96,295 | | **Total** | **$2,930,205** | **$7,501** | **$2,937,706** | * The Company's most recent annual impairment test of goodwill, conducted in Q3 2024, indicated **no impairment**[33](index=33&type=chunk) Finite-Lived Intangible Assets | Metric | December 31, 2024 (in thousands) | June 30, 2025 (in thousands) | | :-------------------------- | :------------------------------- | :--------------------------- | | Balance at period end | $409,689 | $375,935 | **Amortization Expense:** * Three months ended June 30, 2025: **$20.2 million** (down **12% YoY**) * Six months ended June 30, 2025: **$42.1 million** (down **8% YoY**) [Note 3 — Revenue and Related Matters](index=12&type=section&id=Note%203%20%E2%80%94%20Revenue%20and%20Related%20Matters) Disaggregated Revenue by Primary Geographic Market (Six Months Ended June 30) | Primary Geographic Market | 2025 (in thousands) | 2024 (in thousands) | | :------------------------ | :------------------ | :------------------ | | United States and Canada | $2,050,251 | $2,016,631 | | Europe, Middle East and Africa | $791,053 | $703,433 | | Other International | $379,280 | $347,922 | | **Total revenues** | **$3,220,584** | **$3,067,986** | Disaggregated Revenue by Timing of Recognition (Six Months Ended June 30) | Timing of Revenue Recognition | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------- | :------------------ | :------------------ | | Transferred over time | $2,727,533 | $2,585,065 | | Transferred at a point in time | $493,051 | $482,921 | | **Total revenues** | **$3,220,584** | **$3,067,986** | * The aggregate amount of the transaction price allocated to unsatisfied performance obligations as of June 30, 2025, was approximately **$6.1 billion**, with **$2.0 billion** expected to be recognized during the remainder of 2025[45](index=45&type=chunk) [Note 4 — Computation of Earnings Per Share](index=14&type=section&id=Note%204%20%E2%80%94%20Computation%20of%20Earnings%20Per%20Share) Earnings Per Share **Three Months Ended June 30:** | Metric | 2025 ($) | 2024 ($) | | :-------------------------- | :------- | :------- | | Basic income per share | $3.12 | $2.95 | | Diluted income per share | $3.11 | $2.93 | **Six Months Ended June 30:** | Metric | 2025 ($) | 2024 ($) | | :-------------------------- | :------- | :------- | | Basic income per share | $5.85 | $5.64 | | Diluted income per share | $5.82 | $5.60 | [Note 5 — Stock-Based Compensation](index=15&type=section&id=Note%205%20%E2%80%94%20Stock-Based%20Compensation) Stock-Based Compensation Expense **Three Months Ended June 30:** | Award type | 2025 (in millions) | 2024 (in millions) | | :-------------------------- | :----------------- | :----------------- | | Stock appreciation rights | $4.0 | $3.0 | | Restricted stock units | $38.7 | $36.4 | | Common stock equivalents | $0.3 | $0.3 | | **Total** | **$43.0** | **$39.7** | **Six Months Ended June 30:** | Award type | 2025 (in millions) | 2024 (in millions) | | :-------------------------- | :----------------- | :----------------- | | Stock appreciation rights | $7.4 | $7.6 | | Restricted stock units | $85.3 | $82.0 | | Common stock equivalents | $0.5 | $0.6 | | **Total** | **$93.2** | **$90.2** | [Note 6 — Segment Information](index=15&type=section&id=Note%206%20%E2%80%94%20Segment%20Information) * The Company's Chief Executive Officer, as CODM, evaluates segment performance and allocates resources based on **gross contribution**, which excludes certain unallocated expenses[57](index=57&type=chunk)[59](index=59&type=chunk) Consolidated Revenues by Segment (Six Months Ended June 30) | Segment | 2025 (in thousands) | 2024 (in thousands) | | :---------- | :------------------ | :------------------ | | Insights | $2,641,280 | $2,534,164 | | Conferences | $284,004 | $256,153 | | Consulting | $295,300 | $277,669 | | **Total** | **$3,220,584** | **$3,067,986** | [Note 7 — Debt](index=17&type=section&id=Note%207%20%E2%80%94%20Debt) Total Outstanding Borrowings | Description | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :------------------------------------ | :----------------------------- | :------------------------------- | | 2024 Credit Agreement - Revolving facility | $274,400 | $274,400 | | 4.50% Senior Notes due 2028 | $800,000 | $800,000 | | 3.625% Senior Notes due 2029 | $600,000 | $600,000 | | 3.75% Senior Notes due 2030 | $800,000 | $800,000 | | Other | $5,000 | $5,000 | | **Principal amount outstanding** | **$2,479,400** | **$2,479,400** | | Less: deferred financing fees | $(17,410) | $(19,485) | | **Net balance sheet carrying amount** | **$2,461,990** | **$2,459,915** | * The Company had approximately **$0.7 billion** of available borrowing capacity on the 2024 Credit Agreement revolving facility as of June 30, 2025[66](index=66&type=chunk) * The weighted average annual effective rate on outstanding debt for the three and six months ended June 30, 2025, was **4.85%** and **4.87%**, respectively, including the effects of interest rate swaps[67](index=67&type=chunk) * As of June 30, 2025, the Company had one fixed-for-floating interest rate swap contract with a notional value of **$350.0 million**, maturing in September 2025, effectively converting floating SOFR to a fixed base rate of **2.98%**[83](index=83&type=chunk) [Note 8 — Equity](index=19&type=section&id=Note%208%20%E2%80%94%20Equity) * As of June 30, 2025, **$0.6 billion** remained available under the Company's share repurchase program, which had a total authorization of **$5.3 billion**[85](index=85&type=chunk) Share Repurchase Activity (Six Months Ended June 30) | Metric | 2025 | 2024 | | :------------------------------------ | :--------- | :--------- | | Number of shares repurchased () | 960,628 | 1,268,309 | | Cash paid for repurchased shares (in thousands) | $437,155 | $564,717 | Accumulated Other Comprehensive Loss, net (AOCL) | Metric | Balance at Dec 31, 2024 (in thousands) | Balance at June 30, 2025 (in thousands) | | :-------------------------- | :----------------------------------- | :---------------------------------- | | AOCL, net | $(88,333) | $(46,615) | [Note 9 — Income Taxes](index=21&type=section&id=Note%209%20%E2%80%94%20Income%20Taxes) Provision for Income Taxes and Effective Tax Rate **Three Months Ended June 30:** | Metric | 2025 (in millions) | 2024 (in millions) | | :-------------------------- | :----------------- | :----------------- | | Provision for income taxes | $77.0 | $69.7 | | Effective income tax rate (%) | 24.2 | 23.3 | **Six Months Ended June 30:** | Metric | 2025 (in millions) | 2024 (in millions) | | :-------------------------- | :----------------- | :----------------- | | Provision for income taxes | $133.1 | $118.8 | | Effective income tax rate (%) | 22.8 | 21.3 | * The increase in the effective income tax rate for both periods was primarily due to a **lower benefit from research and development tax credits** compared to the prior year[95](index=95&type=chunk)[96](index=96&type=chunk) * The Company is currently assessing the impact of the newly enacted **One Big Beautiful Bill Act (OBBBA)** and monitoring **OECD Pillar Two proposals**, which are expected to impact disclosures[98](index=98&type=chunk)[99](index=99&type=chunk) [Note 10 — Derivatives and Hedging](index=21&type=section&id=Note%2010%20%E2%80%94%20Derivatives%20and%20Hedging) * The Company uses derivative contracts (interest rate swaps and foreign currency forward exchange contracts) to mitigate **cash flow risk** from interest rate changes on variable-rate debt and **foreign exchange rate changes** on forecasted transactions[101](index=101&type=chunk) Derivative Contract Fair Values (June 30, 2025) | Derivative Contract Type | Number of Contracts | Notional Amounts (in thousands) | Fair Value Asset (Liability), Net (in thousands) | | :-------------------------- | :------------------ | :------------------------------ | :----------------------------------------------- | | Interest rate swap | 1 | $350,000 | $1,167 | | Foreign currency forwards | 22 | $78,467 | $(177) | | **Total** | **23** | **$428,467** | **$990** | Derivative Contracts Impact on Statements of Operations (Six Months Ended June 30) | Amount recorded in: | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------- | :------------------ | :------------------ | | Interest expense, net | $8,935 | $9,676 | | Other expense (income), net | $(534) | $(6,069) | | **Total expense, net** | **$8,401** | **$3,607** | [Note 11 — Fair Value Disclosures](index=23&type=section&id=Note%2011%20%E2%80%94%20Fair%20Value%20Disclosures) * The Company's financial instruments, including cash equivalents, fees receivable, accounts payable, and variable-rate borrowings, are generally short-term or reflect current market rates, so their carrying amounts reasonably approximate fair values[107](index=107&type=chunk) Fair Values of Financial Instruments Not Recorded at Fair Value (June 30, 2025) | Description | Carrying Amount (in thousands) | Fair Value (in thousands) | | :-------------------------- | :----------------------------- | :------------------------ | | 2028 Notes | $795,922 | $792,048 | | 229 Notes | $596,119 | $572,268 | | 2030 Notes | $794,552 | $749,712 | | **Total** | **$2,186,593** | **$2,114,028** | * The Company recorded an impairment loss of **$0.6 million** (H1 2025) and **$0.5 million** (H1 2024) on right-of-use assets and other long-lived assets, primarily related to unused office leases, using Level 3 inputs for fair value estimation[114](index=114&type=chunk) [Note 12 — Contingencies](index=24&type=section&id=Note%2012%20%E2%80%94%20Contingencies) * The Company is involved in legal proceedings and claims in the ordinary course of business, but believes that potential liability in excess of accrued amounts will **not materially affect its financial position, cash flows, or results of operations**[115](index=115&type=chunk) * Historically, payments made under indemnification agreements have **not been material**, and as of June 30, 2025, **no material payment obligations existed**[116](index=116&type=chunk) [Note 13 — Leases](index=24&type=section&id=Note%2013%20%E2%80%94%20Leases) * The Company's leasing activities primarily involve facilities with agreements expiring through **2038**, and it also subleases certain office space, mainly in Arlington, Virginia[117](index=117&type=chunk)[120](index=120&type=chunk) Net Lease Cost and Cash Flows **Three Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------------------------------- | :------------------ | :------------------ | | Total lease cost, net | $16,269 | $18,922 | | Cash paid for operating lease liabilities | $38,380 | $38,787 | **Six Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------------------------------- | :------------------ | :------------------ | | Total lease cost, net | $34,916 | $38,574 | | Cash paid for operating lease liabilities | $67,037 | $72,836 | * An impairment loss of **$0.6 million** (H1 2025) and **$0.5 million** (H1 2024) was recognized on right-of-use assets and related long-lived assets due to certain office leases no longer being used[125](index=125&type=chunk) [Note 14 — Subsequent Event](index=25&type=section&id=Note%2014%20%E2%80%94%20Subsequent%20Event) * On July 31, 2025, the Board of Directors authorized an additional **$700.0 million** for share repurchases, adding to the approximately **$350.0 million** remaining from previous authorizations[128](index=128&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=26&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) This section provides management's perspective on Gartner's financial performance, condition, and cash flows, detailing consolidated and segment-specific results, liquidity, and capital resources. It also includes forward-looking statements and discussions of critical accounting policies and recent developments [FORWARD-LOOKING STATEMENTS](index=27&type=section&id=FORWARD-LOOKING%20STATEMENTS) * The report contains forward-looking statements subject to numerous known and unknown risks and uncertainties, including technological developments in AI, customer renewals, global economic conditions, and geopolitical events[131](index=131&type=chunk) * Actual results could differ materially from projections, and readers should not place undue reliance on these statements, which reflect management's opinion only as of the date made[131](index=131&type=chunk)[132](index=132&type=chunk) [BUSINESS OVERVIEW](index=28&type=section&id=BUSINESS%20OVERVIEW) * Gartner delivers actionable, objective business and technology insights through its three segments: **Business and Technology Insights** (renamed from Research in Q2 2025), **Conferences**, and **Consulting**[133](index=133&type=chunk)[134](index=134&type=chunk) * As of June 30, 2025, the Company had **20,994 employees globally**, a **2.4% increase** from June 30, 2024[135](index=135&type=chunk) * Insights contract value with the US federal government decreased to approximately **$200.0 million** at June 30, 2025, from **$275.0 million** at December 31, 2024, with **$20.0 million** in termination notices[136](index=136&type=chunk) * The Company is assessing the impact of the **One Big Beautiful Bill Act (OBBBA)**, enacted July 4, 2025, on its consolidated financial statements[138](index=138&type=chunk) [BUSINESS MEASUREMENTS](index=28&type=section&id=BUSINESS%20MEASUREMENTS) * Key performance indicators include **Insights Contract Value** (annualized value of subscription contracts), **Client Retention Rate**, and **Wallet Retention Rate**[140](index=140&type=chunk) * For Conferences, key metrics are the **Number of destination conferences** and **Number of destination conference attendees**[140](index=140&type=chunk) * Consulting performance is measured by **Consulting backlog** (future revenue from in-process engagements) and **Utilization rate** (consultant productivity)[140](index=140&type=chunk) [EXECUTIVE SUMMARY OF OPERATIONS AND FINANCIAL POSITION](index=30&type=section&id=EXECUTIVE%20SUMMARY%20OF%20OPERATIONS%20AND%20FINANCIAL%20POSITION) * Total revenues for Q2 2025 were **$1.7 billion**, an increase of **6% YoY**, with Insights up **4%**, Conferences up **14%**, and Consulting up **9%**[142](index=142&type=chunk) * Net income for Q2 2025 was **$240.8 million**, with diluted net income per share of **$3.11**[143](index=143&type=chunk) * Cash provided by operating activities for H1 2025 was **$0.7 billion**, and the Company had **$2.2 billion** in cash and cash equivalents with **$0.7 billion** available on its revolving credit facility as of June 30, 2025[143](index=143&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, 2024[144](index=144&type=chunk) [RECENTLY ISSUED ACCOUNTING STANDARDS](index=30&type=section&id=RECENTLY%20ISSUED%20ACCOUNTING%20STANDARDS) * Information regarding recently issued accounting standards that may impact the Company's consolidated financial statements or disclosures in future periods is provided in Note 1 — Business and Basis of Presentation[145](index=145&type=chunk) [RESULTS OF OPERATIONS (Consolidated Results)](index=31&type=section&id=RESULTS%20OF%20OPERATIONS) Consolidated Financial Performance **Three Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | Increase (Decrease) (in thousands) | % Change (%) | | :-------------------------- | :------------------ | :------------------ | :--------------------------------- | :----------- | | Total revenues | $1,686,454 | $1,595,060 | $91,394 | 6 | | Cost of services and product development | $531,731 | $513,314 | $18,417 | 4 | | Selling, general and administrative | $776,888 | $712,071 | $64,817 | 9 | | Operating income | $327,096 | $318,783 | $8,313 | 3 | | Interest expense, net | $(11,801) | $(19,990) | $(8,189) | (41) | | Net income | $240,783 | $229,548 | $11,235 | 5 | **Six Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | Increase (Decrease) (in thousands) | % Change (%) | | :-------------------------- | :------------------ | :------------------ | :--------------------------------- | :----------- | | Total revenues | $3,220,584 | $3,067,986 | $152,598 | 5 | | Cost of services and product development | $1,006,761 | $972,755 | $34,006 | 3 | | Selling, general and administrative | $1,507,196 | $1,401,904 | $105,292 | 8 | | Operating income | $605,128 | $592,668 | $12,460 | 2 | | Interest expense, net | $(25,214) | $(39,209) | $(13,995) | (36) | | Net income | $451,722 | $440,093 | $11,629 | 3 | * Cost of services and product development increased primarily due to **higher personnel expenses** associated with merit increases[149](index=149&type=chunk) * Selling, general and administrative (SG&A) expense increased due to **higher personnel expenses** from increased headcount and merit increases, with total quota-bearing sales associates growing by **5% YoY**[150](index=150&type=chunk) * Interest expense, net, decreased significantly due to **increased interest income** resulting from higher cash balances[154](index=154&type=chunk) [SEGMENT RESULTS](index=33&type=section&id=SEGMENT%20RESULTS) [Insights](index=34&type=section&id=Insights) Insights Segment Performance **Three Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | % Change (Reported) (%) | % Change (FX Neutral) (%) | | :-------------------------- | :------------------ | :------------------ | :------------------------ | :------------------------ | | Revenues | $1,319,453 | $1,265,992 | 4 | 3 | | Gross contribution | $974,675 | $933,121 | 4 | | | Gross contribution margin (%) | 74 | 74 | | | **Six Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | % Change (Reported) (%) | % Change (FX Neutral) (%) | | :-------------------------- | :------------------ | :------------------ | :------------------------ | :------------------------ | | Revenues | $2,641,280 | $2,534,164 | 4 | 5 | | Gross contribution | $1,959,198 | $1,877,690 | 4 | | | Gross contribution margin (%) | 74 | 74 | | | **Business Measurements (FX Neutral, as of June 30):** | Metric | 2025 (in thousands) | 2024 (in thousands) | Change | | :-------------------------- | :------------------ | :------------------ | :------- | | Contract Value | $5,034,000 | $4,799,000 | 5% | | GTS Client retention (%) | 84 | 83 | +1 point | | GTS Wallet retention (%) | 99 | 101 | -2 points | | GBS Client retention (%) | 87 | 87 | — | | GBS Wallet retention (%) | 104 | 106 | -2 points | * Insights contract value increased by **5% year-over-year (FX neutral)**, driven by new business from existing clients, with growth led by **energy, manufacturing, and healthcare sectors**[163](index=163&type=chunk) * The decrease in both GTS and GBS wallet retention was largely due to **lower levels of spending by existing clients** compared to the same period in 2024[164](index=164&type=chunk) [Conferences](index=35&type=section&id=Conferences) Conferences Segment Performance **Three Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | % Change (Reported) (%) | % Change (FX Neutral) (%) | | :-------------------------- | :------------------ | :------------------ | :------------------------ | :------------------------ | | Revenues | $211,407 | $186,084 | 14 | 12 | | Gross contribution | $121,388 | $108,112 | 12 | | | Gross contribution margin (%) | 57 | 58 | -1 point | | | Number of destination conferences () | 19 | 16 | 19 | | **Six Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | % Change (Reported) (%) | % Change (FX Neutral) (%) | | :-------------------------- | :------------------ | :------------------ | :------------------------ | :------------------------ | | Revenues | $284,004 | $256,153 | 11 | 10 | | Gross contribution | $148,770 | $131,367 | 13 | | | Gross contribution margin (%) | 52 | 51 | +1 point | | | Number of destination conferences () | 29 | 28 | 4 | | * The increase in Q2 revenues was primarily due to holding **three additional destination conferences** in Q2 2025 compared to Q2 2024. The H1 revenue increase was primarily due to **increased exhibitor revenue**[167](index=167&type=chunk)[168](index=168&type=chunk) [Consulting](index=36&type=section&id=Consulting) Consulting Segment Performance **Three Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | % Change (Reported) (%) | % Change (FX Neutral) (%) | | :-------------------------- | :------------------ | :------------------ | :------------------------ | :------------------------ | | Revenues | $155,594 | $142,984 | 9 | 6 | | Gross contribution | $61,555 | $53,719 | 15 | | | Gross contribution margin (%) | 40 | 38 | +2 points | | **Six Months Ended June 30:** | Metric | 2025 (in thousands) | 2024 (in thousands) | % Change (Reported) (%) | % Change (FX Neutral) (%) | | :-------------------------- | :------------------ | :------------------ | :------------------------ | :------------------------ | | Revenues | $295,300 | $277,669 | 6 | 6 | | Gross contribution | $114,947 | $108,006 | 6 | | | Gross contribution margin (%) | 39 | 39 | — | | **Business Measurements (FX Neutral, as of June 30):** | Metric | 2025 (in thousands) | 2024 (in thousands) | Change | | :-------------------------- | :------------------ | :------------------ | :------- | | Backlog | $191,100 | $195,000 | (2)% | | Consultant utilization (%) | 65 | 67 | -2 points | * Consulting revenues increased due to a **26% (Q2)** and **30% (H1) increase in contract optimization revenue**, despite a **1% decrease in labor-based consulting revenue** for H1 2025[171](index=171&type=chunk)[172](index=172&type=chunk) * Backlog decreased by **2% (FX neutral)** and consultant utilization decreased by **2 points** for both the three and six months ended June 30, 2025[173](index=173&type=chunk)[169](index=169&type=chunk) [LIQUIDITY AND CAPITAL RESOURCES](index=37&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) * The Company has adequate liquidity, with **$2.2 billion** in cash and cash equivalents and approximately **$0.7 billion** of available borrowing capacity on its revolving credit facility as of June 30, 2025[175](index=175&type=chunk) * Cash provided by operating activities for the six months ended June 30, 2025, was **$697.1 million**, an increase of **$138.3 million YoY**, primarily due to **improved timing of collections and lower income tax payments**[180](index=180&type=chunk)[181](index=181&type=chunk) * Cash used in financing activities for H1 2025 was **$419.7 million**, primarily for share repurchases totaling **$437.2 million**[183](index=183&type=chunk) * Total debt principal outstanding was **$2.5 billion** as of June 30, 2025[184](index=184&type=chunk) [OFF BALANCE SHEET ARRANGEMENTS](index=38&type=section&id=OFF%20BALANCE%20SHEET%20ARRANGEMENTS) * The Company has not entered into any material off-balance sheet arrangements or transactions with unconsolidated entities or other persons from January 1, 2025, through June 30, 2025[185](index=185&type=chunk) [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=38&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) This section outlines Gartner's exposure to various market risks, including interest rate risk, foreign currency risk, and credit risk, and describes the strategies and financial instruments used to manage and mitigate these exposures [INTEREST RATE RISK](index=39&type=section&id=INTEREST%20RATE%20RISK) * Approximately **$274.4 million** of the Company's total debt outstanding as of June 30, 2025, was based on a floating interest rate[188](index=188&type=chunk) * The Company uses interest rate swap contracts to effectively convert floating interest rates on variable-rate borrowings to fixed rates, thereby **reducing exposure to interest rate increases**[188](index=188&type=chunk) [FOREIGN CURRENCY RISK](index=39&type=section&id=FOREIGN%20CURRENCY%20RISK) * The Company is exposed to foreign currency translation and transaction risk due to a significant portion of revenues from sales outside the United States, primarily in **Euro, British Pound, Japanese Yen, Australian dollar, and Canadian dollar**[189](index=189&type=chunk) * A **10% change** in foreign currency exchange rates could impact cash and cash equivalents by approximately **$97.9 million**[190](index=190&type=chunk) * Short-term foreign currency forward exchange contracts are used to **mitigate foreign currency transaction risk**[191](index=191&type=chunk) [CREDIT RISK](index=39&type=section&id=CREDIT%20RISK) * Financial instruments subject to credit risk include cash equivalents, fees receivable, interest rate swap contracts, and foreign currency forward exchange contracts[192](index=192&type=chunk) * Concentration of credit risk is limited due to the use of **large investment-grade commercial banks** as counterparties and a **diverse customer base**[192](index=192&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=39&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) This section confirms that Gartner's disclosure controls and procedures were effective as of June 30, 2025, and reports no material changes to internal control over financial reporting during the quarter * Management concluded that the Company's disclosure controls and procedures were **effective** as of June 30, 2025[194](index=194&type=chunk) * **No material changes** in internal control over financial reporting occurred during the quarter ended June 30, 2025[195](index=195&type=chunk) PART II. OTHER INFORMATION [ITEM 1. LEGAL PROCEEDINGS](index=40&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) This section states that Gartner is involved in routine legal proceedings but does not anticipate any material financial impact beyond amounts already accrued * The Company is involved in legal and administrative proceedings and litigation arising in the ordinary course of business[196](index=196&type=chunk) * Potential liability in excess of accrued amounts is **not expected to have a material effect** on the Company's financial position, cash flows, or results of operations[196](index=196&type=chunk) [ITEM 1A. RISK FACTORS](index=41&type=section&id=ITEM%201A.%20RISK%20FACTORS) This section refers to the Annual Report on Form 10-K for a detailed discussion of risk factors, noting no material changes in the current reporting period * There were **no material changes** to the risk factors disclosed in Part I, Item 1A of the Annual Report on Form 10-K for the year ended December 31, 2024[197](index=197&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=41&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) This section confirms no unregistered sales of equity securities and provides a summary of common stock repurchases during the three months ended June 30, 2025 * There were **no unregistered sales of equity securities** during the period covered by this report[198](index=198&type=chunk) Issuer Purchases of Equity Securities (Three Months Ended June 30, 2025) | Period | Total Number of Shares Purchased () | Average Price Paid Per Share ($) | Maximum Approximate Dollar Value of Shares That May Yet Be Purchased (in thousands) | | :-------------------------- | :----------------------------------- | :------------------------------- | :--------------------------------------------------------------------------------- | | April 1, 2025 to April 30, 2025 | 105,982 | $389.84 | $832,634 | | May 1, 2025 to May 31, 2025 | 225,922 | $443.11 | $736,638 | | June 1, 2025 to June 30, 2025 | 327,979 | $409.78 | $602,395 | | **Total for the quarter** | **659,883** | **$417.99** | | [ITEM 5. OTHER INFORMATION](index=41&type=section&id=ITEM%205.%20OTHER%20INFORMATION) This section reports that no director or Section 16 officer adopted or terminated a Rule 10b5-1(c) trading arrangement during the second quarter of 2025 * No director or Section 16 officer adopted or terminated a trading arrangement intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or a non-Rule 10b5–1 trading arrangement during the three months ended June 30, 2025[201](index=201&type=chunk) [ITEM 6. EXHIBITS](index=41&type=section&id=ITEM%206.%20EXHIBITS) This section lists all exhibits filed with the Form 10-Q, including certifications, XBRL documents, and documents incorporated by reference * Exhibits include certifications (CEO, CFO), Inline XBRL Instance Document, Taxonomy Extension Schema, Calculation, Definition, Label, and Presentation Linkbase Documents, and the Cover Page Interactive Data File[202](index=202&type=chunk) * Restated Certificate of Incorporation and By-laws of Gartner, Inc. are incorporated by reference[203](index=203&type=chunk)