Key Highlights

  • IT shares fell 7.43% pre-market to $218.00 after third-quarter results.
  • Adjusted EPS was $3.59 against a $2.84 consensus.
  • Contract value reached $5.3 billion, up 2.5% year over year on an FX-neutral basis.

Gartner (NYSE:IT) shares fell 7.43% to $218.00 in pre-market today, down $17.49 from the prior close of $235.49, which followed a 0.10% gain on Monday. The shares had gained about 23% over the past month. The company reported third-quarter revenues of $1,505 million, down 1.3% as reported and 1.1% FX neutral, against a market estimate of $1.49 billion. Adjusted revenues, which exclude a divested operation, rose 2.4%.

Gartner is a Stamford, Connecticut-based research and advisory firm founded in 1979. It operates through Insights, Conferences and Consulting segments, has about 20,000 associates serving clients in about 90 countries and is an S&P 500 constituent.

Earnings Rise as the Prior-Year Quarter Carried a Goodwill Impairment

Net income was $214 million, or $3.35 per diluted share, compared with $35 million, or $0.47. The prior-year quarter included a $150 million goodwill Impairment tied to the Digital Markets operation, which was sold in February 2026. Adjusted EPS was $3.59, up 30.1% from $2.76. Adjusted EBITDA excluding the divested operation was $364 million, up 7.5%.

Contract value was $5.3 billion on an FX-neutral basis, up 1.1% sequentially and 2.5% year over year. Global Technology Sales contract value was $4.0 billion, up 2.1% year over year, and Global Business Sales contract value was $1.3 billion, up 3.7%. Insights revenues were $1,292 million, up 1.7%, Conferences revenues were $86 million, up 15.4%, and Consulting revenues were $126 million, up 2.3%.

Cash Flow, Buybacks and a Higher Full-Year Outlook

Operating Cash Flow was $294 million, down 1.4%, and free cash flow was $275 million, up 2.2%. Gartner repurchased 0.9 million shares for $138 million in the quarter and $1.7 billion of stock over the last four quarters.

Management raised its full-year guidance for revenues, Adjusted EBITDA excluding the divested operation, adjusted EPS and free cash flow. Adjusted EPS guidance is now at least $14.65, compared with at least $14.00 before and a consensus of $14.47. The stock has trailing Earnings of $14.39 per share, a 52-week range of $124.25 to $256.90 and a consensus price target of roughly $194 to $198.

Contract Value Growth and Full-Year Guidance Are the Next Checkpoints

Gartner reported higher adjusted EPS, contract value and cash flow alongside lower reported revenues and a lower share price pre-market. The next items to follow are the webcast call today, contract value growth, which management said accelerated again, and delivery against the raised adjusted EPS outlook of at least $14.65.