What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2023-05-02 compared with 2022-11-01 · 132 added, 263 removed, 537 unchanged (42% of the section changed)

4 unchanged sentences

in thousands, except share data)

September 30, December 31,

March 31, December 31,

Current assets:

4 unchanged sentences

Prepaid expenses and other current assets 142,650 119,207

Assets held-for-sale — 49,036

Total current assets 2,903,319 2,786,107

5 unchanged sentences

Total Assets $ 7,378,932 $ 7,299,736

Liabilities and Stockholders’ (Deficit) Equity

Liabilities and Stockholders’ Equity

Current liabilities:

2 unchanged sentences

Current portion of long-term debt 8,400 7,800

Liabilities held-for-sale — 30,840

Total current liabilities 3,454,256 3,597,600

3 unchanged sentences

Total Liabilities 6,906,074 7,071,938

Stockholders’ (Deficit) Equity

Stockholders’ Equity

Preferred stock, $ 0.01 par value, 5,000,000 shares authorized;

7 unchanged sentences

( 5,806,434 ) ( 5,707,104 )

Total Stockholders’ (Deficit) Equity ( 64,926 ) 371,058

Total Liabilities and Stockholders’ (Deficit) Equity $ 6,525,954 $ 7,416,324

Total Stockholders’ Equity 472,858 227,798

Total Liabilities and Stockholders’ Equity $ 7,378,932 $ 7,299,736

See the accompanying notes to Condensed Consolidated Financial Statements.

3 unchanged sentences

in thousands, except per share data)

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022 2021

Three Months Ended

Research $ 1,217,191 $ 1,136,380

8 unchanged sentences

Acquisition and integration charges 1,368 2,207

Gain from sale of divested operation ( 139,316 ) —

Total costs and expenses 1,000,912 1,045,493

2 unchanged sentences

Gain on event cancellation insurance claims 3,077 —

Other income, net 8,930 211 46,684 12,019

Other (expense) income, net ( 2,366 ) 29,206

Income before income taxes 381,277 215,059

12 unchanged sentences

in thousands)

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022 2021

Three Months Ended

Net income $ 295,783 $ 172,515

Other comprehensive (loss) income, net of tax:

Other comprehensive income (loss), net of tax:

Foreign currency translation adjustments 1,832 ( 6,798 )

1 unchanged sentence

Pension plans – net change in deferred actuarial loss 34 48

Other comprehensive (loss) income, net of tax ( 26,032 ) ( 859 ) ( 49,117 ) 15,391

Other comprehensive income (loss), net of tax 5,700 ( 1,380 )

Comprehensive income $ 301,483 $ 171,135

2 unchanged sentences

AND SUBSIDIARIES

Condensed Consolidated Statements of Changes in Stockholders’ (Deficit) Equity

Condensed Consolidated Statements of Changes in Stockholders’ Equity

in thousands)

Three and Nine Months Ended September 30, 2022

Three Months Ended March 31, 2023

Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss, Net Accumulated Earnings Treasury Stock Total

1 unchanged sentence

Net income — — — 295,783 — 295,783

Other comprehensive loss — — ( 1,380 ) — — ( 1,380 )

Other comprehensive income (loss), net — — 5,700 — — 5,700

Issuances under stock plans — ( 2,141 ) — — 9,520 7,379

2 unchanged sentences

Balance at March 31, 2023 $ 82 $ 2,222,511 $ ( 95,910 ) $ 4,152,609 $ ( 5,806,434 ) $ 472,858

Net income — — — 204,925 — 204,925

Other comprehensive loss — — ( 21,705 ) — — ( 21,705 )

Issuances under stock plans — 4,634 — — 427 5,061

Common share repurchases — — — — ( 473,755 ) ( 473,755 )

Stock-based compensation expense — 24,454 — — — 24,454

Balance at June 30, 2022 $ 82 $ 2,136,684 $ ( 104,516 ) $ 3,426,467 $ ( 5,601,584 ) $ ( 142,867 )

Net income — — — 173,545 — 173,545

Other comprehensive loss — — ( 26,032 ) — — ( 26,032 )

Issuances under stock plans — 4,288 — — 706 4,994

Common share repurchases — — — — ( 95,534 ) ( 95,534 )

Stock-based compensation expense — 20,968 — — — 20,968

Balance at September 30, 2022 $ 82 $ 2,161,940 $ ( 130,548 ) $ 3,600,012 $ ( 5,696,412 ) $ ( 64,926 )

Three and Nine Months Ended September 30, 2021

Three Months Ended March 31, 2022

Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Loss, Net Accumulated Earnings Treasury Stock Total

1 unchanged sentence

Net income — — — 172,515 — 172,515

Other comprehensive income — — 6,050 — — 6,050

Other comprehensive income (loss), net — — ( 1,380 ) — — ( 1,380 )

Issuances under stock plans — 579 — — 6,385 6,964

2 unchanged sentences

Balance at March 31, 2022 $ 82 $ 2,107,596 $ ( 82,811 ) $ 3,221,542 $ ( 5,128,256 ) $ 118,153

Net income — — — 271,236 — 271,236

Other comprehensive income — — 10,200 — — 10,200

Issuances under stock plans — 2,063 — — 2,017 4,080

Common share repurchases — — — — ( 675,662 ) ( 675,662 )

Stock-based compensation expense — 26,190 — — — 26,190

Balance at June 30, 2021 $ 82 $ 2,031,726 $ ( 82,978 ) $ 2,690,803 $ ( 4,111,995 ) $ 527,638

Net income — — — 148,865 — 148,865

Other comprehensive loss — — ( 859 ) — — ( 859 )

Issuances under stock plans — 3,411 — — 720 4,131

Common share repurchases — — — — ( 364,694 ) ( 364,694 )

Stock-based compensation expense — 19,426 — — — 19,426

Balance at September 30, 2021 $ 82 $ 2,054,563 $ ( 83,837 ) $ 2,839,668 $ ( 4,475,969 ) $ 334,507

See the accompanying notes to Condensed Consolidated Financial Statements.

3 unchanged sentences

in thousands)

Nine Months Ended

September 30,

Three Months Ended

Operating activities:

4 unchanged sentences

Deferred taxes ( 7,866 ) ( 7,502 )

Gain from sale of divested operation ( 139,316 ) —

Loss on impairment of lease related assets 8,720 23,878

1 unchanged sentence

Amortization and write-off of deferred financing fees 1,161 1,133

Gain on de-designated swaps ( 51,745 ) ( 12,149 )

Changes in assets and liabilities:

Loss (gain) on de-designated swaps 1,393 ( 29,896 )

Changes in assets and liabilities, net of acquisitions and divestitures:

Fees receivable, net 36,177 30,700

7 unchanged sentences

Additions to property, equipment and leasehold improvements ( 21,122 ) ( 17,293 )

Acquisitions - cash paid (net of cash acquired) ( 4,109 ) ( 23,030 )

Cash used in investing activities ( 74,570 ) ( 61,700 )

Proceeds from sale of divested operation 158,733 —

Cash provided by (used in) investing activities 137,611 ( 17,293 )

Financing activities:

Proceeds from employee stock purchase plan 7,358 6,949

Proceeds from borrowings — 600,000

Payments of deferred financing fees — ( 7,320 )

Payments on revolving credit facility — ( 5,000 )

Payments on borrowings ( 1,800 ) ( 1,331 )

1 unchanged sentence

Cash used in financing activities ( 101,292 ) ( 445,452 )

Net (decrease) increase in cash and cash equivalents and restricted cash ( 189,687 ) 71,798

Net increase (decrease) in cash and cash equivalents and restricted cash 200,998 ( 294,960 )

Effects of exchange rates on cash and cash equivalents ( 5,485 ) ( 5,358 )

18 unchanged sentences

In the opinion of management, all normal recurring accruals and adjustments considered necessary for a fair presentation of financial position, results of operations and cash flows at the dates and for the periods presented herein have been included.

The results of operations for the three and nine months ended September 30, 2022 may not be indicative of the results of operations for the remainder of 2022 or beyond.

The results of operations for the three months ended March 31, 2023 may not be indicative of the results of operations for the remainder of 2023 or beyond.

When used in these notes, the terms “Gartner,” the “Company,” “we,” “us,” or “our” refer to Gartner, Inc.

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Below is a table presenting the beginning-of-period and end-of-period cash amounts from the Company’s Condensed Consolidated Balance Sheets and the total cash amounts presented in the Condensed Consolidated Statements of Cash Flows (in thousands).

September 30, December 31,

March 31, December 31,

Cash and cash equivalents $ 893,512 $ 697,999

Restricted cash classified in (1):

Prepaid expenses and other current assets — 4,109

Other assets 600 600

Cash and cash equivalents and restricted cash $ 894,112 $ 698,599

(1) Restricted cash consisted of an escrow account established in connection with the Company’s 2021 business acquisition.

(1) Restricted cash consisted of an escrow account established in connection with one of the Company’s business acquisitions.

Generally, such cash is restricted to use due to provisions contained in the underlying stock or asset purchase agreement.

During the three months ended September 30, 2022, the Company paid $ 4.1 million of restricted cash for deferred

consideration related to a 2021 acquisition.

Note 2 - Acquisition provides additional information regarding the 2021 acquisition.

The Company will disburse the restricted cash to the sellers of the business upon satisfaction of any contingencies described in such agreements (e.g., potential indemnification claims, etc.).

Revenue recognition.

5 unchanged sentences

Gain on event cancellation insurance claims.

In May 2021, the Company received $ 150.0 million of proceeds related to 2020 event cancellation insurance claims, and recorded a pre-tax gain of $ 135.5 million.

In February 2023, the Company received $ 3.1 million of proceeds related to 2020 event cancellation insurance claims.

The Company does not record any gain on insurance claims in excess of expenses incurred until the receipt of the insurance proceeds is deemed to be realizable.

Adoption of new accounting standards.

The Company adopted the accounting standard described below during the nine months ended September 30, 2022.

Business Combinations — In October 2021, the FASB issued ASU No.

2021-08, Business Combinations, Accounting for Contract Assets and Contract Liabilities from Contracts with Customers (“ASU No.

2021-08 provides guidance for a business combination on how to recognize and measure contract assets and contract liabilities from revenue contracts with customers and other contracts that apply the provisions of ASC Topic 606, Revenue from Contracts with Customers .

Specifically, the proposed amendments would require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with ASC Topic 606.

Generally, this would result in an acquirer recognizing and measuring the acquired contract assets and contract liabilities consistent with how they were recognized and measured in the acquiree’s financial statements (if the acquiree prepared financial statements in accordance with U.S.

The rule will be effective for public entities on January 1, 2023, with early adoption permitted.

Gartner has elected to adopt ASU No.

2021-08 effective January 1, 2022.

2021-08 will not impact acquired contract assets or liabilities from business combinations occurring prior to January 1, 2022, and the impact in future periods will depend on the contract assets and contract liabilities acquired in future business combinations.

Accounting standards issued but not yet adopted.

The FASB has issued accounting standards that have not yet become effective and may impact the Company’s consolidated financial statements or related disclosures in future periods.

Those standards and their potential impact are discussed below.

Accounting standard effective immediately upon voluntary election by Gartner

Adoption of new accounting standard.

The Company adopted the accounting standard described below during the three months ended March 31, 2023.

Reference Rate Reform — In March 2020, the FASB issued ASU No.

1 unchanged sentence

2020-04 provides that an entity can elect not to apply certain required modification accounting in U.S.

GAAP to contracts where all changes to the critical terms relate to reference rate reform (e.g., the expected discontinuance of LIBOR and the transition to an alternative reference interest rate).

GAAP to contracts where all changes to the critical terms relate to reference rate reform (e.g., the expected discontinuance of LIBOR and the transition to an alternative reference interest rate, etc.).

In addition, the rule provides optional expedients and exceptions that enable entities to continue to apply hedge accounting for hedging relationships where one or more of the critical terms change due to reference rate reform.

The rule became effective for all entities as of March 12, 2020 and will generally no longer be available to apply after December 31, 2022.

The Company is currently evaluating the potential impact of ASU No.

2020-04 on its consolidated financial statements, including the rule’s potential impact on any debt modifications or other contractual changes in the future that may result from reference rate reform.

Accounting standard effective later in 2022

Government Assistance — In November 2021, the FASB issued ASU No.

2021-10, Government Assistance (Topic 832), Disclosures by Business Entities about Government Assistance (“ASU No.

2021-10 requires business entities to annually disclose information about certain government assistance they receive.

The rule will be effective for public entities for annual periods beginning after December 15, 2021.

The adoption of ASU No.

2021-10 is currently not expected to have a material impact on the Company’s financial statement disclosures.

Note 2 — Acquisition

On June 17, 2021, the Company acquired 100 % of the outstanding capital stock of Pulse Q&A Inc.

(“Pulse”), a privately-held company based in San Francisco, California, for an aggregate purchase price of $ 29.9 million.

Pulse is a technology-enabled community platform.

During 2021, the Company paid $ 22.9 million in cash for Pulse after considering the cash acquired with the business, amounts held in escrow and certain other purchase price adjustments.

During the three months ended September 30, 2022, the Company paid $ 4.1 million of deferred consideration held in escrow.

In addition to the purchase price, the Company may also be required to pay up to $ 4.5 million in cash based on the continuing employment of certain key employees.

Such amounts are recognized as compensation expense over three years post-acquisition and reported in Acquisition and integration charges in the Condensed Consolidated Statements of Operations.

The Company recorded $ 31.0 million of goodwill and finite-lived intangible assets and $ 1.1 million of liabilities on a net basis for the Pulse acquisition.

2022-06, which was issued in December 2022, extended the deadline to December 31, 2024.

During 2023, the Company adopted the practical expedient provided under ASU 2020-04 related to its debt and interest rate swap arrangements and as such, any amendments are treated as a continuation of the existing agreements and no gain or loss on the modification is recorded.

Note 2 — Acquisition and Divestiture

In October 2022, the Company acquired 100 % of the outstanding capital stock of UpCity, Inc.

(“UpCity”), a privately-held company based in Chicago, Illinois, for an aggregate purchase price of $ 6.4 million.

UpCity’s online marketplace helps small businesses by connecting them to ratings and reviews of more than 50,000 B2B service providers.

In February 2023, the Company completed the sale of a non-core business, TalentNeuron, for approximately $ 164.2 million and realized $ 158.7 million in cash from the sale, which was net of certain closing expenses.

The sale is subject to certain post-closing adjustments.

The Company recorded a pre-tax gain of $ 139.3 million on the sale of TalentNeuron, which is included in Gain from sale of divested operation in the Condensed Consolidated Statement of Operations for the three months ended March 31, 2023.

TalentNeuron was included in the Company’s Research segment.

The principal components of the assets divested included goodwill, intangible assets, net, property, equipment and leasehold improvements, net, and accounts receivable, with carrying amounts of $ 16.0 million, $ 9.5 million, $ 4.5 million and $ 11.8 million, respectively, while the liabilities transferred with the sale primarily consisted of deferred revenue with a carrying amount of $ 24.4 million.

Such assets and liabilities were included in Assets held-for-sale and Liabilities held-for-sale, respectively, on the Condensed Consolidated Balance Sheet at December 31, 2022 at their respective carrying values at that date.

Note 3 — Goodwill and Intangible Assets

8 unchanged sentences

Subsequent to completing the 2022 annual impairment test, there were no events or changes in circumstances noted that required an interim impairment test.

The table below presents changes to the carrying amount of goodwill by segment during the nine months ended September 30, 2022 (in thousands).

The table below presents changes to the carrying amount of goodwill by segment during the three months ended March 31, 2023 (in thousands).

Research Conferences Consulting Total

1 unchanged sentence

Foreign currency translation impact ( 390 ) 1 119 ( 270 )

Balance at September 30, 2022 (1) $ 2,658,183 $ 183,873 $ 94,084 $ 2,936,140

Balance at March 31, 2023 (1) $ 2,650,803 $ 183,952 $ 95,186 $ 2,929,941

(1) The Company does no t have any accumulated goodwill impairment losses.

1 unchanged sentence

The tables below present reconciliations of the carrying amounts of the Company’s finite-lived intangible assets as of the dates indicated (in thousands).

September 30, 2022 Customer

March 31, 2023 Customer

Relationships Technology-related Other Total

3 unchanged sentences

Accumulated amortization (1) ( 509,583 ) ( 6,533 ) ( 5,854 ) ( 521,970 )

Balance at September 30, 2022 $ 581,610 $ 17,139 $ 5,084 $ 603,833

Balance at March 31, 2023 $ 554,889 $ 4,667 $ 4,582 $ 564,138

December 31, 2022 Customer

5 unchanged sentences

Customer relationships— 6 to 13 years;

Technology-related— 3 to 7 years;

Technology-related— 3 years;

and Other— 4 to 11 years.

Amortization expense related to finite-lived intangible assets was $ 24.4 million and $ 27.1 million during the three months ended September 30, 2022 and 2021, respectively, and $ 74.3 million and $ 83.8 million during the nine months ended September 30, 2022 and 2021, respectively.

Amortization expense related to finite-lived intangible assets was $ 22.7 million and $ 25.1 million during the three months ended March 31, 2023 and 2022, respectively.

The estimated future amortization expense by year for finite-lived intangible assets is presented in the table below (in thousands).

2022 (remaining three months) $ 23,979

2023 (remaining nine months) $ 68,301

Thereafter 171,156

2 unchanged sentences

By Primary Geographic Market (1)

Three Months Ended September 30, 2022

Primary Geographic Market Research Conferences Consulting Total

United States and Canada $ 771,534 $ 44,499 $ 67,194 $ 883,227

Europe, Middle East and Africa 245,093 18,034 26,644 289,771

Other International 131,196 14,498 13,176 158,870

Total revenues $ 1,147,823 $ 77,031 $ 107,014 $ 1,331,868

Three Months Ended September 30, 2021

Primary Geographic Market Research Conferences Consulting Total

United States and Canada $ 671,517 $ 14,171 $ 56,715 $ 742,403

Europe, Middle East and Africa 242,273 7,975 26,707 276,955

Other International 123,334 2,269 11,321 136,924

Total revenues $ 1,037,124 $ 24,415 $ 94,743 $ 1,156,282

Nine Months Ended September 30, 2022

Three Months Ended March 31, 2023

Primary Geographic Market Research Conferences Consulting Total

3 unchanged sentences

Total revenues $ 1,217,191 $ 64,642 $ 127,036 $ 1,408,869

Nine Months Ended September 30, 2021

Three Months Ended March 31, 2022

Primary Geographic Market Research Conferences Consulting Total

8 unchanged sentences

By Timing of Revenue Recognition

Three Months Ended September 30, 2022

Timing of Revenue Recognition Research Conferences Consulting Total

Transferred over time (1) $ 1,045,425 $ — $ 90,316 $ 1,135,741

Transferred at a point in time (2) 102,398 77,031 16,698 196,127

Total revenues $ 1,147,823 $ 77,031 $ 107,014 $ 1,331,868

Three Months Ended September 30, 2021

Timing of Revenue Recognition Research Conferences Consulting Total

Transferred over time (1) $ 944,206 $ — $ 77,538 $ 1,021,744

Transferred at a point in time (2) 92,918 24,415 17,205 134,538

Total revenues $ 1,037,124 $ 24,415 $ 94,743 $ 1,156,282

Nine Months Ended September 30, 2022

Three Months Ended March 31, 2023

Timing of Revenue Recognition Research Conferences Consulting Total

2 unchanged sentences

Total revenues $ 1,217,191 $ 64,642 $ 127,036 $ 1,408,869

Nine Months Ended September 30, 2021

Three Months Ended March 31, 2022

Timing of Revenue Recognition Research Conferences Consulting Total

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(2) The revenues in this category are recognized in connection with performance obligations that are satisfied at the point in time that the contractual deliverables are provided to the customer.

Performance Obligations — For customer contracts that are greater than one year in duration, the aggregate amount of the transaction price allocated to performance obligations that were unsatisfied (or partially unsatisfied) as of September 30, 2022 was approximately $ 4.9 billion.

The Company expects to recognize $ 2.4 billion, $ 2.1 billion and $ 0.8 billion of this revenue (most of which pertains to Research) during the remainder of 2023, the year ending December 31, 2024 and thereafter, respectively.

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The table below provides information regarding certain of the Company’s balance sheet accounts that pertain to its contracts with customers (in thousands).

September 30, December 31,

March 31, December 31,

Fees receivable, gross (1) $ 1,531,441 $ 1,565,786

8 unchanged sentences

Both situations occur before the completion of the Company’s performance obligation(s).

The Company recognized revenue of $ 931.6 million and $ 818.4 million during the three months ended September 30, 2022 and 2021, respectively, and $ 1.8 billion and $ 1.5 billion during the nine months ended September 30, 2022 and 2021, respectively, that was attributable to deferred revenues that were recorded at the beginning of each such period.

The Company recognized revenue of $ 924.9 million and $ 833.9 million during the three months ended March 31, 2023 and 2022, respectively, that was attributable to deferred revenues that were recorded at the beginning of each such period.

Those amounts primarily consisted of Research revenues that were recognized ratably as control of the goods or services passed to the customer during the reporting periods.

During each of the three and nine months ended September 30, 2022 and 2021, the Company did not record any material impairments related to its contract assets.

During each of the three months ended March 31, 2023 and 2022, the Company did not record any material impairments related to its contract assets.

Note 5 — Computation of Earnings Per Share

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The table below sets forth the calculation of basic and diluted income per share for the periods indicated (in thousands, except per share data).

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022 2021

Three Months Ended

Net income used for calculating basic and diluted income per share $ 295,783 $ 172,515

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(1) Certain outstanding awards associated with stock-based compensation plans were not included in the computation of diluted income per share because the effect would have been anti-dilutive.

These anti-dilutive outstanding awards associated with stock-based compensation plans totaled approximately 0.1 million for both of the three and nine months ended September 30, 2022.

For both of the three and nine months ended September 30, 2021, the number of anti-dilutive shares was de minimis.

These anti-dilutive outstanding awards associated with stock-based compensation plans totaled approximately 0.3 million and 0.2 million for the three months ended March 31, 2023 and 2022, respectively.

Note 6 — Stock-Based Compensation

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The Company currently awards stock-settled stock appreciation rights, service-based and performance-based restricted stock units, and common stock equivalents.

As of September 30, 2022, the Company had 3.9 million shares of its common stock, par value $ 0.0005 per share, (the “Common Stock”) available for stock-based compensation awards under its current Long-Term Incentive Plan as amended and restated in January 2019 (the “Plan”).

As of March 31, 2023, the Company had 1.9 million shares of its common stock, par value $ 0.0005 per share, (the “Common Stock”) available for stock-based compensation awards under its current Long-Term Incentive Plan as amended and restated in January 2019 (the “Plan”).

The tables below summarize the Company’s stock-based compensation expense by award type and expense category line item during the periods indicated (in millions).

Three Months Ended Nine Months Ended

September 30, September 30,

Three Months Ended

Award type 2023 2022

3 unchanged sentences

Total (1) $ 45.0 $ 32.1

Three Months Ended Nine Months Ended

September 30, September 30,

Three Months Ended

Expense category line item 2023 2022

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Total (1) $ 45.0 $ 32.1

(1) Includes costs of $ 5.4 million and $ 5.5 million during the three months ended September 30, 2022 and 2021, respectively, and $ 32.7 million and $ 38.3 million during the nine months ended September 30, 2022 and 2021, respectively, for awards to retirement-eligible employees.

(1) Includes costs of $ 26.8 million and $ 19.2 million during the three months ended March 31, 2023 and 2022, respectively, for awards to retirement-eligible employees.

Those awards vest on an accelerated basis.

(2) On February 5, 2020, prior to the COVID-19 related shutdown in the U.S., the Compensation Committee (“Committee”) of the Board of Directors of the Company established performance measures for the performance-based restricted stock units (the “PSUs”) awarded to the Company’s executive officers in 2020 under the Plan.

Based on preliminary corporate performance results for the 2020 performance measures, the 2020 PSUs would have been earned at 50 % of target.

However, on February 3, 2021, the Committee determined to use its discretion under the Plan to approve a payout at 95 % of target.

In deciding to exercise this discretion to adjust the PSU payout, the Committee considered the Company’s strong overall performance in 2020 despite the significant negative impact of the COVID-19 pandemic.

As a result of the modification, the Company recognized $ 6.5 million of incremental compensation cost during the nine months ended September 30, 2021.

Note 7 — Segment Information

The Company’s products and services are delivered through three segments – Research, Conferences and Consulting, as described below.

• Research equips executives and their teams from every function and across all industries with actionable, objective insight, guidance and tools.

• Research equips executives and their teams from every function and across all industries with actionable, objective insight,

guidance and tools.

Our experienced experts deliver all this value informed by an unmatched combination of practitioner-sourced and data-driven research to help our clients address their mission critical priorities.

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The Company evaluates segment performance and allocates resources based on gross contribution margin.

Gross contribution, as presented in the tables below, is defined as operating income or loss excluding certain Cost of services and product development expenses, Selling, general and administrative expenses, Depreciation, Amortization of intangibles, and Acquisition and integration charges.

Certain bonus and fringe benefit costs included in consolidated Cost of services and product development are not allocated to segment expense.

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The tables below present information about the Company’s reportable segments for the periods indicated (in thousands).

Three Months Ended September 30, 2022 Research Conferences Consulting Consolidated

Revenues $ 1,147,823 $ 77,031 $ 107,014 $ 1,331,868

Gross contribution 848,438 40,318 37,213 925,969

Corporate and other expenses ( 672,551 )

Operating income $ 253,418

Three Months Ended September 30, 2021 Research Conferences Consulting Consolidated

Revenues $ 1,037,124 $ 24,415 $ 94,743 $ 1,156,282

Gross contribution 769,091 11,456 30,972 811,519

Corporate and other expenses ( 581,298 )

Operating income $ 230,221

Nine Months Ended September 30, 2022 Research Conferences Consulting Consolidated

Three Months Ended March 31, 2023 Research Conferences Consulting Consolidated

Revenues $ 1,217,191 $ 64,642 $ 127,036 $ 1,408,869

2 unchanged sentences

Operating income $ 407,957

Nine Months Ended September 30, 2021 Research Conferences Consulting Consolidated

Three Months Ended March 31, 2022 Research Conferences Consulting Consolidated

Revenues $ 1,136,380 $ 10,354 $ 116,006 $ 1,262,740

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The table below provides a reconciliation of total segment gross contribution to net income for the periods indicated (in thousands).

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022 2021

Three Months Ended

Total segment gross contribution $ 977,110 $ 897,515

4 unchanged sentences

Acquisition and integration charges 1,368 2,207

Gain from sale of divested operation ( 139,316 ) —

Operating income 407,957 217,247

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The Company’s total outstanding borrowings are summarized in the table below (in thousands).

September 30, December 31,

March 31, December 31,

Description 2023 2022

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Net balance sheet carrying amount $ 2,460,769 $ 2,461,407

(1) The contractual annualized interest rate as of September 30, 2022 on the 2020 Credit Agreement Term loan facility and the Revolving credit facility was 4.50 %, which consisted of a floating Eurodollar base rate of 3.125 % plus a margin of 1.375 %.

However, the Company has interest rate swap contracts that effectively convert the floating Eurodollar base rates on outstanding amounts to a fixed base rate.

(2) The Company had approximately $ 1.0 billion of available borrowing capacity on the 2020 Credit Agreement revolver (not including the expansion feature) as of September 30, 2022.

(1) The contractual annualized interest rate as of March 31, 2023 on the 2020 Credit Agreement Term loan facility and the Revolving credit facility was 6.13 %, which consisted of a floating Eurodollar base rate of 4.875 % plus a margin of 1.250 %.

However, the Company has an interest rate swap contract that effectively convert the floating Eurodollar base rates on outstanding amounts to a fixed base rate.

(2) The Company had approximately $ 1.0 billion of available borrowing capacity on the 2020 Credit Agreement revolver (not including the expansion feature) as of March 31, 2023.

(3) Consists of $ 800.0 million principal amount of 2028 Notes outstanding.

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The 2030 Notes bear interest at a fixed rate of 3.75 % and mature on October 1, 2030.

(6) Consists of two State of Connecticut economic development loans.

One of the loans originated in 2012, has a 10 -year maturity and the outstanding balance of $ 0.1 million as of September 30, 2022 bears interest at a fixed rate of 3.00 %.

The second loan, originated in 2019, has a 10 -year maturity and bears interest at a fixed rate of 1.75 %.

Both of these loans may be repaid at any time by the Company without penalty.

(7) The weighted average annual effective rate on the Company’s outstanding debt for the three and nine months ended September 30, 2022, including the effects of its interest rate swaps discussed below, was 4.68 % and 4.69 %, respectively.

(6) Consists of a State of Connecticut economic development loan originated in 2019 with a 10 -year maturity and bears interest at a fixed rate of 1.75 %.

This loan may be repaid at any time by the Company without penalty.

(7) The weighted average annual effective rate on the Company’s outstanding debt for the three months ended March 31, 2023, including the effects of its interest rate swaps discussed below, was 5.03 %.

(8) Deferred financing fees are being amortized to Interest expense, net over the term of the related debt obligation.

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The 2020 Credit Agreement contains certain customary restrictive loan covenants, including, among others, financial covenants that apply a maximum consolidated leverage ratio and a minimum consolidated interest expense coverage ratio.

The Company was in compliance with all financial covenants as of September 30, 2022.

The Company was in compliance with all financial covenants as of March 31, 2023.

The Term loan is being repaid in consecutive quarterly installments that commenced on December 31, 2020, plus a final payment to be made on September 28, 2025.

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Interest Rate Swaps

As of September 30, 2022, the Company had one fixed-for-floating interest rate swap contract with a notional value of $ 350.0 million that matures in 2025.

As of March 31, 2023, the Company had one fixed-for-floating interest rate swap contract with a notional value of $ 350.0 million that matures in 2025.

The Company pays a base fixed rate of 3.04 % and in return receives a floating Eurodollar base rate on 30 -day notional borrowings.

In June 2022, the Company terminated a fixed-for-floating interest rate swap contract with a notional value of $ 350.0 million, and received proceeds of $ 0.5 million.

The Company had two other fixed-for-floating interest rate swap contracts with a total notional value of $ 700.0 million that matured during the three months ended March 31, 2022.

Effective June 30, 2020, the Company de-designated all of its interest rate swaps and discontinued hedge accounting.

Accordingly, subsequent changes to the fair value of the interest rate swaps are recorded in Other income, net.

Accordingly, subsequent changes to the fair value of the interest rate swaps are recorded in Other (expense) income, net.

The amounts previously recorded in Accumulated other comprehensive loss are amortized into Interest expense, net over the terms of the hedged forecasted interest payments.

As of September 30, 2022, $ 57.5 million is remaining in Accumulated other comprehensive loss, net.

The interest rate swaps had an unrealized fair value of $ 10.3 million and a negative unrealized fair value (liability) of $ 53.7 million as of September 30, 2022 and December 31, 2021, respectively, of which $ 43.2 million and $ 56.3 million were recorded in Accumulated other comprehensive loss, net of tax effect, as of September 30, 2022 and December 31, 2021, respectively.

See Note 12 — Fair Value Disclosures for the determination of the fair values of Company’s interest rate swaps.

As of March 31, 2023, $ 47.2 million is remaining in Accumulated other comprehensive loss, net.

See Note 11 — Derivatives and Hedging for the amounts remaining in Accumulated other comprehensive loss, net of tax effect, at March 31, 2023 and December 31, 2022.

See Note 12 — Fair Value Disclosures for a discussion of the fair values of Company’s interest rate swaps.

Note 9 — Equity

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In 2015, the Company’s Board of Directors (the “Board”) authorized a share repurchase program to repurchase up to $ 1.2 billion of the Company’s common stock.

The Board authorized incremental share repurchases of up to an additional $ 1.6 billion and $ 1.0 billion of the Company’s common stock during 2021 and the first half of 2022, respectively.

As of September 30, 2022, $ 612.8 million remained available under the share repurchase program.

The Board authorized incremental share repurchases of up to an additional $ 1.6 billion, $ 1.0 billion and $ 0.4 billion of the Company’s common stock during 2021, 2022, and February 2023, respectively.

As of March 31, 2023, $ 954.5 million remained available under the share repurchase program.

The Company may repurchase its common stock from time-to-time in amounts, at prices and in the manner that the Company deems appropriate, subject to the availability of stock, prevailing market conditions, the trading price of the stock, the Company’s financial performance and other conditions.

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The Company’s share repurchase activity is presented in the table below for the periods indicated.

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022 2021

Three Months Ended

Number of shares repurchased (1) 327,680 1,627,709

Cash paid for repurchased shares (in thousands) (2) $ 106,850 $ 451,070

(1) The average purchase price for repurchased shares was $ 254.71 and $ 290.54 for the three months ended September 30, 2022 and 2021, respectively, and $ 272.84 and $ 219.00 for the nine months ended September 30, 2022 and 2021, respectively.

The repurchased shares during the three and nine months ended September 30, 2022 and 2021 included purchases for both open market purchases and stock-based compensation award settlements.

(2) The cash paid for repurchased shares during the nine months ended September 30, 2022 excluded $ 6.0 million of open market purchases with trade dates in September 2022 that settled in October 2022.

The cash paid for repurchased shares during the nine months ended September 30, 2021 included $ 8.0 million of open market purchases with trade dates in December 2020 that settled in January 2021 and excluded $ 20.0 million of open market purchases with trade dates in September 2021 that settled in October 2021.

The cash paid for repurchased shares during the three months ended September 30, 2022 included $ 7.0 million of open market purchases with trade dates in June 2022 that settled in July 2022, and excluded $ 6.0 million of open market purchases with trade dates in September 2022 that settled in October 2022.

The cash paid for repurchased shares during the three months ended September 30, 2021 included $ 10.8 million of open market purchases with trade dates in June 2021 that settled in July 2021, and excluded $ 20.0 million of open market purchases with trade dates in September 2021 that settled in October 2021.

(1) The average purchase price for repurchased shares was $ 332.18 and $ 284.53 for the three months ended March 31, 2023 and 2022, respectively.

The repurchased shares during the three months ended March 31, 2023 and 2022 included purchases for both open market purchases and stock-based compensation award settlements.

(2) The cash paid for repurchased shares during the three months ended March 31, 2023 excluded $ 2.0 million of open market purchases with trade dates in March 2023 that settled in April 2023.

The cash paid for repurchased shares during the three months ended March 31, 2022 excluded $ 12.1 million of open market purchases with trade dates in March 2022 that settled in April 2022.

Accumulated Other Comprehensive Loss, net (“AOCL”)

The tables below provide information about the changes in AOCL by component and the related amounts reclassified out of AOCL to income during the periods indicated (net of tax, in thousands) (1).

Three Months Ended September 30, 2022

Interest Rate

Swaps Defined

Pension Plans Foreign

Adjustments Total

Balance – June 30, 2022 $ ( 47,084 ) $ ( 6,767 ) $ ( 50,665 ) $ ( 104,516 )

Other comprehensive income (loss) activity during the period:

Change in AOCL before reclassifications to income — — ( 29,961 ) ( 29,961 )

Reclassifications from AOCL to income (2), (3) 3,886 43 — 3,929

Other comprehensive income (loss), net 3,886 43 ( 29,961 ) ( 26,032 )

Balance – September 30, 2022 $ ( 43,198 ) $ ( 6,724 ) $ ( 80,626 ) $ ( 130,548 )

Three Months Ended September 30, 2021

Interest Rate

Swaps Defined

Pension Plans Foreign

Adjustments Total

Balance – June 30, 2021 $ ( 67,377 ) $ ( 9,102 ) $ ( 6,499 ) $ ( 82,978 )

Other comprehensive income (loss) activity during the period:

Change in AOCL before reclassifications to income — — ( 6,488 ) ( 6,488 )

Reclassifications from AOCL to income (2), (3) 5,529 100 — 5,629

Other comprehensive income (loss), net 5,529 100 ( 6,488 ) ( 859 )

Balance – September 30, 2021 $ ( 61,848 ) $ ( 9,002 ) $ ( 12,987 ) $ ( 83,837 )

Nine Months Ended September 30, 2022

Three Months Ended March 31, 2023

Interest Rate

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Adjustments Total

Balance – December 31, 2021 $ ( 56,323 ) $ ( 6,672 ) $ ( 18,436 ) $ ( 81,431 )

Balance - Balance at December 31, 2022 $ ( 39,248 ) $ ( 4,247 ) $ ( 58,115 ) $ ( 101,610 )

Other comprehensive income (loss) activity during the period:

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Other comprehensive income (loss), net 3,834 34 1,832 5,700

Balance – September 30, 2022 $ ( 43,198 ) $ ( 6,724 ) $ ( 80,626 ) $ ( 130,548 )

Nine Months Ended September 30, 2021

Balance – March 31, 2023 $ ( 35,414 ) $ ( 4,213 ) $ ( 56,283 ) $ ( 95,910 )

Three Months Ended March 31, 2022

Interest Rate

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Other comprehensive income (loss), net 5,370 48 ( 6,798 ) ( 1,380 )

Balance – September 30, 2021 $ ( 61,848 ) $ ( 9,002 ) $ ( 12,987 ) $ ( 83,837 )

Balance – March 31, 2022 $ ( 50,953 ) $ ( 6,624 ) $ ( 25,234 ) $ ( 82,811 )

(1) Amounts in parentheses represent debits (deferred losses).

(2) $ 5.2 million and $ 7.4 million of the reclassifications related to interest rate swaps (cash flow hedges) were recorded in Interest expense, net, for the three months ended September 30, 2022 and 2021, respectively.

$ 17.5 million and $ 21.7 million of the reclassifications related to interest rate swaps (cash flow hedges) were recorded in Interest expense, net, for the nine months ended September 30, 2022 and 2021, respectively.

(2) $ 5.1 million and $ 7.2 million of the reclassifications related to interest rate swaps (cash flow hedges) were recorded in Interest expense, net, for the three months ended March 31, 2023 and 2022, respectively.

See Note 8 — Debt and Note 11 — Derivatives and Hedging for information regarding the cash flow hedges.

(3) The reclassifications related to defined benefit pension plans were recorded in Other income, net.

The estimated net amount of the existing losses on the Company’s interest rate swaps that are reported in Accumulated other comprehensive loss, net at September 30, 2022 that is expected to be reclassified into earnings within the next 12 months is $ 20.3 million.

(3) The reclassifications related to defined benefit pension plans were recorded in Other (expense) income, net.

The estimated net amount of the existing losses on the Company’s interest rate swaps that are reported in Accumulated other comprehensive loss, net at March 31, 2023 that is expected to be reclassified into earnings within the next 12 months is $ 19.8 million.

Note 10 — Income Taxes

The provision for income taxes was $ 58.5 million and $ 50.0 million for the three months ended September 30, 2022 and 2021, respectively, and $ 172.1 million and $ 208.6 million for the nine months ended September 30, 2022 and 2021, respectively.

The effective income tax rate was 25.2 % and 25.1 % for the three months ended September 30, 2022 and 2021, respectively, and 23.8 % and 26.3 % for the nine months ended September 30, 2022 and 2021, respectively.

During the second quarter of 2021, the United Kingdom enacted legislation raising its corporate tax rate from 19% to 25% effective April 2023, which led to a higher effective income tax rate for the nine months ended September 30, 2021 as compared to the same period in 2022.

The Company had gross unrecognized tax benefits of $ 158.2 million on September 30, 2022 and $ 150.0 million on December 31, 2021.

The provision for income taxes was $ 85.5 million and $ 42.5 million for the three months ended March 31, 2023 and 2022, respectively.

The effective income tax rate was 22.4 % and 19.8 % for the three months ended March 31, 2023 and 2022, respectively.

The year-over-year increase in the effective income tax rate was primarily due to the sale of the TalentNeuron business.

The Company had gross unrecognized tax benefits of $ 141.0 million on March 31, 2023 and $ 137.2 million on December 31, 2022.

It is reasonably possible that gross unrecognized tax benefits will decrease by approximately $ 12.3 million within the next twelve months due to the anticipated closure of audits and the expiration of certain statutes of limitation.

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The tables below provide information regarding the Company’s outstanding derivative contracts as of the dates indicated (in thousands, except for number of contracts).

September 30, 2022

March 31, 2023

Derivative Contract Type Number of

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in AOCL, net of tax

Interest rate swaps (1) 4 $ 1,400,000 $ ( 31,942 ) Other liabilities $ ( 56,323 )

( 21,795 ) Accrued liabilities

Foreign currency forwards (2) 138 533,506 ( 91 ) Accrued liabilities —

Interest rate swaps (1) 1 $ 350,000 $ 3,952 Other assets $ ( 39,248 )

6,346 Other current assets

Foreign currency forwards (2) 138 687,763 625 Other current assets —

Total 139 $ 1,037,763 $ 10,923 $ ( 39,248 )

(1) Effective June 30, 2020, the Company de-designated all of its interest rate swaps and discontinued hedge accounting.

Accordingly, subsequent changes to fair value of the interest rate swaps are recorded in Other income, net.

Accordingly, subsequent changes to fair value of the interest rate swaps are recorded in Other (expense) income, net.

The amounts previously recorded in Accumulated other comprehensive loss are amortized into Interest expense, net over the terms of the hedged forecasted interest payments.

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The Company enters into short-term foreign currency forward exchange contracts to mitigate the cash flow risk associated with changes in foreign currency rates on forecasted foreign currency transactions.

These contracts are accounted for at fair value with realized and unrealized gains and losses recognized in Other income, net because the Company does not designate these contracts as hedges for accounting purposes.

All of the outstanding foreign currency forward exchange contracts at September 30, 2022 matured before October 31, 2022.

These contracts are accounted for at fair value with realized and unrealized gains and losses recognized in Other (expense) income, net because the Company does not designate these contracts as hedges for accounting purposes.

All of the outstanding foreign currency forward exchange contracts at March 31, 2023 matured before April 30, 2023.

(3) See Note 12 — Fair Value Disclosures for the determination of the fair values of these instruments.

At September 30, 2022, all of the Company’s derivative counterparties were investment grade financial institutions.

At March 31, 2023, all of the Company’s derivative counterparties were investment grade financial institutions.

The Company did not have any collateral arrangements with its derivative counterparties and none of the derivative contracts contained credit-risk related contingent features.

The table below provides information regarding amounts recognized in the accompanying Condensed Consolidated Statements of Operations for derivative contracts for the periods indicated (in thousands).

Three Months Ended Nine Months Ended

September 30, September 30,

Three Months Ended

Amount recorded in:

2022 2021 2022 2021

Interest expense, net (1) $ 5,117 $ 7,166

Other expense (income), net (2) 1,904 ( 26,900 )

Total expense, net $ 6,480 $ 9,938 $ 59 $ 9,924

Total expense (income), net $ 7,021 $ ( 19,734 )

(1) Consists of interest expense from interest rate swap contracts.

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The table below presents the fair values of certain financial assets and liabilities that are measured at fair value on a recurring basis in the Company's financial statements (in thousands).

Description September 30,

Description March 31,

2023 December 31,

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Foreign currency forward contracts (2) 42 3,236

Interest rate swap contracts (3) 10,266 —

Interest rate swap contract (3) 7,590 10,298

Total Level 2 inputs 97,149 97,852

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Foreign currency forward contracts (2) 525 2,611

Interest rate swap contracts (3) — 53,737

Total Level 2 inputs 108,696 99,252

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Valuation of these contracts is based on observable foreign currency exchange rates in active markets, which the Company considers to be a Level 2 input.

(3) The Company has interest rate swap contracts that hedge the risk of variability from interest payments on its borrowings (see Note 8 — Debt).

The fair values of interest rate swaps are based on mark-to-market valuations prepared by a third-party broker.

Those valuations are based on observable interest rates from recently executed market transactions and other observable market data, which the Company considers to be Level 2 inputs.

(3) The Company has an interest rate swap contract that hedges the risk of variability from interest payments on its borrowings (see Note 8 — Debt).

The fair value of the interest rate swap is based on mark-to-market valuations prepared by a third-party broker.

This valuation are based on observable interest rates from recently executed market transactions and other observable market data, which the Company considers to be Level 2 inputs.

The Company independently corroborates the reasonableness of the valuations prepared by the third-party broker by using an electronic quotation service.

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Carrying Amount Fair Value

September 30, December 31, September 30, December 31,

March 31, December 31, March 31, December 31,

Description 2023 2022 2023 2022

5 unchanged sentences

The Company’s certain long-lived assets, including identifiable intangible assets, goodwill, right-of-use assets and other long-lived assets, are measured at fair value on a nonrecurring basis when there are indicators of impairment.

During the three and nine months ended September 30, 2022, the Company recorded impairment charges of $ 2.0 million and $ 37.5 million, respectively, on right-of-use assets and other long-lived assets primarily related to certain office leases that the Company determined will no longer be used.

During the three months ended March 31, 2023 and 2022, the Company recorded impairment charges of $ 8.7 million and $ 23.9 million, respectively, on right-of-use assets and other long-lived assets primarily related to certain office leases that the Company determined will no longer be used.

The impairments were derived by comparing the fair value of the impacted assets to the carrying value of those assets as of the impairment measurement date, as required under ASC Topic 360 using Level 3 inputs.

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Historically, payments made by the Company under these agreements have not been material.

As of September 30, 2022, the Company did not have any material payment obligations under any such indemnification agreements.

As of March 31, 2023, the Company did not have any material payment obligations under any such indemnification agreements.

Note 14 — Leases

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The table below presents the Company’s net lease cost and certain other information related to the Company’s leasing activities as of and for the periods indicated (dollars in thousands).

Three Months Ended Nine Months Ended

September 30,

2022 2021 2022 2021

Three Months Ended

Operating lease cost (1) $ 28,799 $ 30,364

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Right-of-use assets obtained in exchange for new operating lease liabilities $ 1,647 $ 6,930

(1) Included in operating lease cost was $ 10.4 million and $ 10.6 million for the three months ended September 30, 2022 and 2021, respectively, and $ 31.3 million and $ 31.8 million for the nine months ended September 30, 2022 and 2021, respectively, for costs related to subleasing activities.

(1) Included in operating lease cost was $ 10.6 million and $ 10.5 million for the three months ended March 31, 2023 and 2022, respectively, for costs related to subleasing activities.

(2) These amounts are primarily variable lease and nonlease costs that are not fixed at the lease commencement date or are dependent on something other than an index or a rate.

(3) The Company did not capitalize any operating lease costs during any of the periods presented.

(4) Amount excludes impairment charges on lease related assets totaling $ 2.0 million and $ 37.5 million, for the three and nine months ended September 30, 2022, respectively, as discussed below.

(4) Amount excludes impairment charges on lease related assets totaling $ 8.7 million and $ 23.9 million, for the three months ended March 31, 2023 and 2022, respectively, as discussed below.

The table below indicates where the discounted operating lease payments from the above table are classified in the accompanying Condensed Consolidated Balance Sheets (in thousands).

September 30, December 31,

March 31, December 31,

Accounts payable and accrued liabilities $ 99,674 $ 99,717

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Total operating lease liabilities included in the Condensed Consolidated Balance Sheets $ 675,637 $ 696,984

During the nine months ended September 30, 2022, as a result and in consideration of the changing nature of the Company’s use of office space for its workforce and the impacts of the COVID-19 pandemic, the Company continued to evaluate its existing real estate lease portfolio.

This evaluation included the decision to abandon a portion of one leased office space and the cease-use of certain other leased office spaces that the Company intends to sublease.

As a result and in consideration of the changing nature of the Company’s use of office space for its workforce and the transitioning to a virtual-first hybrid work environment, the Company has been evaluating its existing real estate lease portfolio.

In connection with this evaluation, the Company reviewed certain of its right-of-use assets and related other long-lived assets for impairment under ASC 360.

As a result of the evaluation, the Company recognized impairment losses during the three and nine months ended September 30, 2022 of $ 2.0 million and $ 37.5 million, respectively, which is included as a component of Selling, general and administrative expenses in the accompanying Condensed Consolidated Statements of Operations.

The impairment losses recorded include $ 1.7 million and $ 27.0 million related to right-of-use assets for the three and nine months ended September 30, 2022, respectively.

The impairment losses also include $ 0.3 million and $ 10.5 million related to other long-lived assets, primarily leasehold improvements, for the three and nine months ended September 30, 2022, respectively.

As a result of the evaluation, the Company recognized impairment losses during the three months ended March 31, 2023 and 2022 of $ 8.7 million and $ 23.9 million, respectively, which are included as a component of Selling, general and administrative expenses in the accompanying Condensed Consolidated Statements of Operations.

The impairment losses recorded include $ 6.3 million and $ 17.7 million related to right-of-use assets and $ 2.4 million and $ 6.2 million related to other long-lived assets, primarily leasehold improvements, for the three months ended March 31, 2023 and 2022, respectively.

The fair values for the asset groups relating to the impaired long-lived assets were estimated primarily using discounted cash flow models (income approach) with Level 3 inputs.

The significant assumptions used in estimating fair values include the

expected downtime prior to the commencement of future subleases, projected sublease income over the remaining lease periods and discount rates that reflect the level of risk associated with receiving future cash flows.

The significant assumptions used in estimating fair values include the expected downtime prior to the commencement of future subleases, projected sublease income over the remaining lease periods and discount rates that reflect the level of risk associated with receiving future cash flows.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements