Forrester Research(FORR) - 2025 Q2 - Quarterly Results

Financial Highlights Forrester Research reported a decline in Q2 2025 financial results, with contract value down 7% year-over-year, while revenue and EPS exceeded consensus - Contract Value (CV) stood at $288.7 million as of June 30, 2025, representing a 7% decrease compared to the prior year[3] - CEO George F. Colony noted that despite market uncertainty impacting CV, the company delivered results above consensus and is focusing on its AI research capabilities and its generative AI tool, Izola, to help clients[4] Q2 2025 vs. Q2 2024 Performance Summary | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $111.7 million | $121.8 million | -8.3% | | GAAP Net Income | $3.9 million | $6.3 million | -38.1% | | GAAP Diluted EPS | $0.20 | $0.33 | -39.4% | | Adjusted Net Income | $9.8 million | $12.9 million | -24.0% | | Adjusted Diluted EPS | $0.51 | $0.68 | -25.0% | Business Outlook (Full-Year 2025 Guidance) Forrester provided full-year 2025 guidance, projecting a revenue decline of 5.2% to 7.5% and a GAAP loss per share due to a goodwill impairment charge Full-Year 2025 GAAP Guidance | Metric | Guidance Range | | :--- | :--- | | Total Revenues | $400.0M - $410.0M (-7.5% to -5.2% YoY) | | Operating Margin | -18.4% to -17.4% | | Diluted Loss Per Share | $4.16 - $4.01 | Full-Year 2025 Adjusted Guidance | Metric | Guidance Range | | :--- | :--- | | Adjusted Operating Margin | 8.0% to 9.0% | | Adjusted Diluted EPS | $1.20 to $1.35 | - Adjusted guidance for 2025 excludes several items, most notably a goodwill impairment charge of $83.9 million, stock-based compensation of $12.0 million to $13.0 million, and amortization of acquisition-related intangible assets of approximately $8.7 million[9] Consolidated Financial Statements This section presents detailed unaudited financial results for Q2 2025, including statements of operations, GAAP to adjusted reconciliations, and key operational metrics Consolidated Statements of Operations Q2 2025 total revenues declined to $111.7 million, with a significant six-month net loss of $83.4 million due to a goodwill impairment charge Revenue by Segment (Three Months Ended June 30) | Revenue Segment | 2025 (in thousands) | 2024 (in thousands) | Change | | :--- | :--- | :--- | :--- | | Research | $77,926 | $83,663 | -6.9% | | Consulting | $23,493 | $24,811 | -5.3% | | Events | $10,240 | $13,351 | -23.3% | | Total Revenues | $111,659 | $121,825 | -8.3% | - For the six months ended June 30, 2025, the company recorded a goodwill impairment charge of $83.9 million, which was the primary driver of the net loss of $83.4 million for the period[15] Profitability Summary (Three Months Ended June 30) | Metric (in thousands) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Income from operations | $6,956 | $11,314 | | Net income | $3,913 | $6,292 | Reconciliation of GAAP to Adjusted Results Q2 2025 adjusted income from operations was $13.7 million, with adjusted net income of $9.8 million, or $0.51 per diluted share Reconciliation of Operating Income (Three Months Ended June 30) | (in thousands) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Income from operations - GAAP | $6,956 | $11,314 | | Amortization of intangible assets | $2,217 | $2,513 | | Restructuring costs | $491 | $82 | | Stock-based compensation | $3,986 | $4,025 | | Adjusted income from operations | $13,650 | $17,934 | Reconciliation of Net Income (Three Months Ended June 30) | (in thousands, except per share) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net income - GAAP | $3,913 | $6,292 | | Adjustments (net of tax) | $5,892 | $6,620 | | Adjusted net income | $9,805 | $12,912 | | Adjusted diluted EPS | $0.51 | $0.68 | Key Financial and Operational Metrics As of June 30, 2025, Forrester reported $135.0 million in cash, with declines in contract value, wallet retention, and client count Select Balance Sheet Data (in thousands) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash, cash equivalents and marketable investments | $134,954 | $104,669 | | Deferred revenue | $154,502 | $145,404 | | Debt outstanding | $35,000 | $35,000 | Key Operational Metrics (as of June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Contract value | $288,700 thousand | $311,900 thousand | | Client retention | 74% | 72% | | Wallet retention | 85% | 88% | | Number of clients | 1,805 | 2,052 | - Total headcount decreased by 11.5% year-over-year, from 1,656 on June 30, 2024, to 1,465 on June 30, 2025. The sales force was reduced from 592 to 540 over the same period[19]