10-Q · May 5, 2026
Gartner, Inc. reported total revenues of $1.5 billion for Q1 2026, a decline of 2% from the previous year primarily due to the sale of its Digital Markets business. Net income increased to $222.3 million, with diluted…
Earnings analysis · 10-Q
IT earnings analysis
Filed August 4, 2026 · Our reading of the company's report
The latest report
Gartner delivered a mixed top line but materially stronger profitability in Q2: revenue declined 1% year over year to $1.676 billion following the Digital Markets sale, while diluted EPS increased 33% to $4.14 and…
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Gartner delivered a mixed top line but materially stronger profitability in Q2: revenue declined 1% year over year to $1.676 billion following the Digital Markets sale, while diluted EPS increased 33% to $4.14 and operating margin expanded to 22.6%. Insights and Conferences grew 2% and 15%, respectively, offsetting a 9% Consulting decline. Operating cash flow rose to $789.3 million for the first six months, although $1.1 billion of share repurchases reduced cash and the company carries $3.0 billion of debt.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
Reported figures
- Earnings per share
- $4.14
What stood out
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Sequential revenue rebound despite reported YoY decline
Q2 revenue was $1.676 billion, down $10.5 million, or 1%, year over year due primarily to the February 2026 Digital Markets divestiture. Revenue increased about 11% from Q1 2026's $1.51 billion.
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Expense discipline drove margin expansion
Operating income rose $51.4 million, or 16%, to $378.5 million. The operating margin expanded to 22.6% from 19.4% a year earlier and 20.5% in Q1 2026, as cost of services and product development fell to 29% of revenue from 32%.
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EPS accelerated year over year and sequentially
Diluted EPS increased $1.03 year over year to $4.14, versus $3.11 in Q2 2025, and rose from $3.18 in Q1 2026. Net income increased 14% to $275.5 million.
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Conferences produced strongest segment growth
Conferences revenue grew $32.8 million, or 15%, to $244.2 million, led by higher exhibitor and attendee revenue. Gross contribution margin expanded 2 points to 59%, even with 18 destination conferences versus 19 a year ago.
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Insights contract value and margins improved
Insights revenue increased 2% to $1.290 billion and gross contribution margin increased 1 point to 77%. Contract value reached $5.283 billion, up 2% in foreign-currency-neutral terms, with GTS and GBS contract value up 1% and 3%, respectively.
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Operating cash flow strengthened and buybacks continued
Six-month operating cash flow rose $92.3 million to $789.3 million, aided by higher net income and improved collection timing. The company repurchased $1.1 billion of stock in the first six months of 2026.
What to watch
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Consulting contraction continued
Consulting revenue declined $13.7 million, or 9%, to $141.9 million, while gross contribution margin fell 2 points to 38%. Management cited weakness in Japan and EMEA commercial markets; labor-based consulting revenue declined 13%.
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Existing-client spending retention weakened
Despite Insights contract value growth to $5.283 billion, GTS wallet retention fell to 97% from 99% and GBS wallet retention fell to 99% from 104%, reflecting lower spending by existing clients.
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Interest burden increased with $3.0B debt
Net interest expense increased $10.5 million, or 89%, to $22.3 million, driven by lower interest income and interest on the 2031 and 2035 notes. Total debt principal was $3.0 billion at June 30, 2026.
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Buybacks reduced cash balance
Cash and cash equivalents fell to $1.489 billion at June 30, 2026 from $1.723 billion at December 31, 2025, as financing cash outflow totaled $1.073 billion in the first six months, largely from buybacks.
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No material risk-factor updates; FX remains exposure
Item 1A disclosed no material changes to the risk factors in the 2025 Form 10-K. The filing nonetheless identifies a $125.9 million potential cash-balance impact from a 10% move in foreign exchange rates.
Management's outlook
The 10-Q provides no quantitative revenue or EPS outlook. Management states it believes it has adequate liquidity for the next 12 months and the foreseeable future; any updated full-year guidance was deferred to the earnings release/call.
Earlier filings 1
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.