What changed in this filing

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Item 1. Financial Statements

2023-11-03 compared with 2023-08-01 · 140 added, 117 removed, 651 unchanged (28% of the section changed)

4 unchanged sentences

in thousands, except share data)

June 30, December 31,

September 30, December 31,

Current assets:

40 unchanged sentences

in thousands, except per share data)

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022

29 unchanged sentences

in thousands)

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022

11 unchanged sentences

in thousands)

Three and Six Months Ended June 30, 2023

Three and Nine Months Ended September 30, 2023

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

12 unchanged sentences

Balance at June 30, 2023 $ 82 $ 2,259,057 $ ( 85,127 ) $ 4,350,652 $ ( 5,938,158 ) $ 586,506

Three and Six Months Ended June 30, 2022

Net income — — — 180,009 — 180,009

Other comprehensive loss — — ( 9,431 ) — — ( 9,431 )

Issuances under stock plans — 4,914 — — 979 5,893

Common share repurchases — — — — ( 223,381 ) ( 223,381 )

Stock-based compensation expense — 27,042 — — — 27,042

Balance at September 30, 2023 $ 82 $ 2,291,013 $ ( 94,558 ) $ 4,530,661 $ ( 6,160,560 ) $ 566,638

Three and Nine Months Ended September 30, 2022

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

12 unchanged sentences

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 )

See the accompanying notes to Condensed Consolidated Financial Statements.

3 unchanged sentences

in thousands)

Six Months Ended

Nine Months Ended

September 30,

Operating activities:

19 unchanged sentences

Additions to property, equipment and leasehold improvements ( 75,145 ) ( 70,461 )

Acquisitions - cash paid (net of cash acquired) ( 3,800 ) ( 4,109 )

Proceeds from sale of divested operation 156,057 —

25 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 six months ended June 30, 2023 may not be indicative of the results of operations for the remainder of 2023 or beyond.

The results of operations for the three and nine months ended September 30, 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.

16 unchanged sentences

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).

June 30, December 31,

September 30, December 31,

Cash and cash equivalents $ 1,249,355 $ 697,999

4 unchanged sentences

(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.

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.).

Generally, such cash is restricted to use due to provisions contained in the underlying acquisition agreement.

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.

8 unchanged sentences

Adoption of new accounting standard.

The Company adopted the accounting standard described below during the six months ended June 30, 2023.

The Company adopted the accounting standard described below during the nine months ended September 30, 2023.

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

5 unchanged sentences

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, the amendments in the second quarter of 2023 are treated as a continuation of the existing agreements and no gain or loss on the modification was recorded.

Note 2 — Acquisition and Divestiture

Note 2 — Acquisitions and Divestiture

In September 2023, the Company acquired 100 % of a formerly independent sales agent of Gartner research products in the Czech Republic for an aggregate purchase price of $ 7.9 million, including cash acquired and deferred consideration.

The allocation of the purchase price is preliminary with respect to certain tax matters.

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

2 unchanged sentences

In February 2023, the Company completed the sale of a non-core business, TalentNeuron, for approximately $ 161.1 million after consideration of post-close adjustments.

$ 156.1 million cash was received from the sale during the six months ended June 30, 2023.

The Company recorded a pre-tax gain of $ 135.4 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 six months ended June 30, 2023.

For the three months ended June 30, 2023, post-close adjustments were settled and resulted in a $ 3.9 million reduction to the gain.

$ 156.1 million cash was received from the sale during the nine months ended September 30, 2023.

TalentNeuron was included in the Company’s Research segment.

3 unchanged sentences

Goodwill represents the excess of the purchase price of acquired businesses over the estimated fair values of the tangible and identifiable intangible net assets acquired.

Evaluations of the recoverability of goodwill are performed in accordance with

FASB ASC Topic 350, which requires an annual assessment of potential goodwill impairment at the reporting unit level and whenever events or changes in circumstances indicate that the carrying value of goodwill may not be recoverable.

Evaluations of the recoverability of goodwill are performed in accordance with FASB ASC Topic 350, which requires an annual assessment of potential goodwill impairment at the reporting unit level and whenever events or changes in circumstances indicate that the carrying value of goodwill may not be recoverable.

When performing the annual assessment of the recoverability of goodwill, the Company initially performs a qualitative analysis evaluating whether any events or circumstances occurred or exist that provide evidence that it is more likely than not that the fair value of any of the Company’s reporting units is less than the related carrying amount.

5 unchanged sentences

Subsequent to completing the 2023 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 six months ended June 30, 2023 (in thousands).

The table below presents changes to the carrying amount of goodwill by segment during the nine months ended September 30, 2023 (in thousands).

Research Conferences Consulting Total

Balance at December 31, 2022 (1) $ 2,651,193 $ 183,951 $ 95,067 $ 2,930,211

Addition due to an acquisition (2) 4,176 — — 4,176

Foreign currency translation impact ( 1,267 ) — 146 ( 1,121 )

Balance at June 30, 2023 (1) $ 2,652,226 $ 183,973 $ 95,622 $ 2,931,821

Balance at September 30, 2023 (1) $ 2,654,102 $ 183,951 $ 95,213 $ 2,933,266

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

(2) The addition was due to the acquisition of an independent sales agent in September 2023.

See Note 2 - Acquisitions and Divestiture for additional information.

Finite-Lived Intangible Assets

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

June 30, 2023 Customer

September 30, 2023 Customer

Relationships Technology-related Other Total

Gross cost at December 31, 2022 $ 1,060,541 $ 11,200 $ 10,436 $ 1,082,177

Addition due to an acquisition (2) 990 — — 990

Intangible assets fully amortized ( 987 ) ( 39 ) — ( 1,026 )

2 unchanged sentences

Accumulated amortization (1) ( 553,279 ) ( 8,400 ) ( 6,356 ) ( 568,035 )

Balance at June 30, 2023 $ 539,730 $ 3,733 $ 4,331 $ 547,794

Balance at September 30, 2023 $ 512,235 $ 2,800 $ 4,080 $ 519,115

December 31, 2022 Customer

7 unchanged sentences

and Other— 4 to 11 years.

Amortization expense related to finite-lived intangible assets was $ 22.9 million and $ 24.8 million during the three months ended June 30, 2023 and 2022, respectively, and $ 45.6 million and $ 49.9 million during the six months ended June 30, 2023 and 2022, respectively.

(2) The addition was due to the acquisition of an independent sales agent in September 2023.

See Note 2 - Acquisitions and Divestiture for additional information.

Amortization expense related to finite-lived intangible assets was $ 24.0 million and $ 24.4 million during the three months ended September 30, 2023 and 2022, respectively, and $ 69.6 million and $ 74.3 million during the nine months ended September 30, 2023 and 2022, respectively.

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

2023 (remaining six months) $ 46,004

2023 (remaining three months) $ 22,777

Thereafter 171,336

2 unchanged sentences

By Primary Geographic Market (1)

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Primary Geographic Market Research Conferences Consulting Total

3 unchanged sentences

Total revenues $ 1,218,739 $ 57,200 $ 132,845 $ 1,408,784

Three Months Ended June 30, 2022

Three Months Ended September 30, 2022

Primary Geographic Market Research Conferences Consulting Total

3 unchanged sentences

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

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Primary Geographic Market Research Conferences Consulting Total

3 unchanged sentences

Total revenues $ 3,643,815 $ 290,739 $ 386,284 $ 4,320,838

Six Months Ended June 30, 2022

Nine Months Ended September 30, 2022

Primary Geographic Market Research Conferences Consulting Total

5 unchanged sentences

The Company’s revenue is generated primarily through direct sales to clients by domestic and international sales forces and a network of independent international sales agents.

Most of the Company’s products and services are provided on an integrated worldwide basis and, because of this integrated delivery approach, it is not practical to precisely separate the Company’s

revenue by geographic location.

Accordingly, revenue information presented in the above tables is based on internal allocations, which involve certain management estimates and judgments.

By Timing of Revenue Recognition

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Timing of Revenue Recognition Research Conferences Consulting Total

2 unchanged sentences

Total revenues $ 1,218,739 $ 57,200 $ 132,845 $ 1,408,784

Three Months Ended June 30, 2022

Three Months Ended September 30, 2022

Timing of Revenue Recognition Research Conferences Consulting Total

2 unchanged sentences

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

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Timing of Revenue Recognition Research Conferences Consulting Total

2 unchanged sentences

Total revenues $ 3,643,815 $ 290,739 $ 386,284 $ 4,320,838

Six Months Ended June 30, 2022

Nine Months Ended September 30, 2022

Timing of Revenue Recognition Research Conferences Consulting Total

3 unchanged sentences

(1) Research revenues in this category are recognized in connection with performance obligations that are satisfied over time using a time-elapsed output method to measure progress.

Consulting revenues in this category are recognized over time using labor hours as an input measurement basis.

Consulting revenues in this category are recognized over time using labor hours as an input measurement.

(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 June 30, 2023 was approximately $ 5.2 billion.

The Company expects to recognize $ 0.9 billion, $ 2.7 billion and $ 1.5 billion of this revenue (most of which pertains to Research) during the remainder of 2023, the year ending December 31, 2024 and thereafter, respectively.

5 unchanged sentences

The remaining duration of these performance obligations is generally less than one year, which aligns with the period that the parties have enforceable rights and obligations under the affected contracts.

Customer Contract Assets and Liabilities — The timing of the recognition of revenue and the amount and timing of the Company’s billings and cash collections, including upfront customer payments, result in the recognition of both assets and

liabilities on the Company’s Condensed Consolidated Balance Sheets.

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

June 30, December 31,

September 30, December 31,

Fees receivable, gross (1) $ 1,148,563 $ 1,565,786

8 unchanged sentences

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

The Company recognized revenue of $ 1.2 billion and $ 1.0 billion during the three months ended June 30, 2023 and 2022, respectively, and $ 1.6 billion and $ 1.4 billion during the six months ended June 30, 2023 and 2022, respectively, that was attributable to deferred revenues that were recorded at the beginning of each such period.

The Company recognized revenue of $ 1.0 billion and $ 0.9 billion during the three months ended September 30, 2023 and 2022, respectively, and $ 1.9 billion and $ 1.8 billion during the nine months ended September 30, 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 six months ended June 30, 2023 and 2022, the Company did not record any material impairments related to its contract assets.

During each of the three and nine months ended September 30, 2023 and 2022, the Company did not record any material impairments related to its contract assets.

Note 5 — Computation of Earnings Per Share

3 unchanged sentences

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 Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022

6 unchanged sentences

(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 $ 0.2 million and $ 0.4 million for the three months

ended June 30, 2023 and 2022, respectively, and $ 0.2 million and $ 0.3 million for the six months ended June 30, 2023 and 2022, respectively.

These anti-dilutive outstanding awards associated with stock-based compensation plans totaled approximately 0.1 million for the three and nine months ended September 30, 2023 and 2022.

Note 6 — Stock-Based Compensation

1 unchanged sentence

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

As of June 30, 2023, the Company had 5.9 million shares of its common stock, par value $ 0.0005 per share, (the “Common Stock”) available for stock-based compensation awards under the Gartner, Inc.

As of September 30, 2023, the Company had 6.0 million shares of its common stock, par value $ 0.0005 per share, (the “Common Stock”) available for stock-based compensation awards under the Gartner, Inc.

Long-Term Incentive Plan as amended and restated in June 2023 (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 Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

Award type 2023 2022 2023 2022

3 unchanged sentences

Total (1) $ 27.1 $ 21.0 $ 104.4 $ 77.6

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

Expense category line item 2023 2022 2023 2022

2 unchanged sentences

Total (1) $ 27.1 $ 21.0 $ 104.4 $ 77.6

(1) Includes costs of $ 13.1 million and $ 8.1 million during the three months ended June 30, 2023 and 2022, respectively, and $ 39.9 million and $ 27.3 million during the six months ended June 30, 2023 and 2022, respectively, for awards to retirement-eligible employees.

(1) Includes costs of $ 8.5 million and $ 5.4 million during the three months ended September 30, 2023 and 2022, respectively, and $ 48.4 million and $ 32.7 million during the nine months ended September 30, 2023 and 2022, respectively, for awards to retirement-eligible employees.

Those awards vest on an accelerated basis.

10 unchanged sentences

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

The accounting policies used by

the reportable segments are the same as those used by the Company.

The accounting policies used by the reportable segments are the same as those used by the Company.

There are no intersegment revenues.

2 unchanged sentences

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

Three Months Ended June 30, 2023 Research Conferences Consulting Consolidated

Three Months Ended September 30, 2023 Research Conferences Consulting Consolidated

Revenues $ 1,218,739 $ 57,200 $ 132,845 $ 1,408,784

2 unchanged sentences

Operating income $ 244,417

Three Months Ended June 30, 2022 Research Conferences Consulting Consolidated

Three Months Ended September 30, 2022 Research Conferences Consulting Consolidated

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

2 unchanged sentences

Operating income $ 253,418

Six Months Ended June 30, 2023 Research Conferences Consulting Consolidated

Nine Months Ended September 30, 2023 Research Conferences Consulting Consolidated

Revenues $ 3,643,815 $ 290,739 $ 386,284 $ 4,320,838

2 unchanged sentences

Operating income $ 935,481

Six Months Ended June 30, 2022 Research Conferences Consulting Consolidated

Nine Months Ended September 30, 2022 Research Conferences Consulting Consolidated

Revenues $ 3,426,532 $ 200,910 $ 343,687 $ 3,971,129

3 unchanged sentences

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

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022

16 unchanged sentences

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

June 30, December 31,

September 30, December 31,

Description 2023 2022

11 unchanged sentences

Net balance sheet carrying amount $ 2,459,513 $ 2,461,407

(1) The contractual annualized interest rate as of June 30, 2023 on the amended 2020 Credit Agreement Term loan facility and the Revolving credit facility was 6.475 %, which consisted of Term Secured Overnight Financing Rate ("SOFR") of 5.125 % plus a margin of 1.350 %.

However, the Company has an interest rate swap contract that effectively convert the floating SOFR 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 June 30, 2023.

(1) The contractual annualized interest rate as of September 30, 2023 on the amended 2020 Credit Agreement Term loan facility and the Revolving credit facility was 6.725 %, which consisted of Term Secured Overnight Financing Rate ("SOFR") of 5.375 % plus a margin of 1.350 %.

However, the Company has an interest rate swap contract that effectively converts the floating SOFR 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, 2023.

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

6 unchanged sentences

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 and six months ended June 30, 2023, including the effects of its interest rate swaps discussed below, was 5.02 %.

(7) The weighted average annual effective rate on the Company’s outstanding debt for the three and nine months ended September 30, 2023, including the effects of its interest rate swaps discussed below, was 4.98 % and 5.01 %, respectively.

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

26 unchanged sentences

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 June 30, 2023.

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

4 unchanged sentences

Interest Rate Swaps

As of June 30, 2023, 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 September 30, 2023, the Company had one fixed-for-floating interest rate swap contract with a notional value of $ 350.0 million that matures in 2025.

In May 2023, in conjunction with the amendment of the 2020 credit agreement, the Company entered into an amendment of its interest rate swap contract.

4 unchanged sentences

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 June 30, 2023, $ 42.1 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 June 30, 2023 and December 31, 2022.

As of September 30, 2023, $ 37.2 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 September 30, 2023 and December 31, 2022.

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

3 unchanged sentences

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 June 30, 2023, $ 827.9 million remained available under the share repurchase program.

As of September 30, 2023, $ 610.8 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.

2 unchanged sentences

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

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022

1 unchanged sentence

Cash paid for repurchased shares (in thousands) (2) $ 209,367 $ 96,534 $ 447,739 $ 1,026,414

(1) The average purchase price for repurchased shares was $ 312.95 and $ 265.98 for the three months ended June 30, 2023 and 2022, respectively, and $ 321.34 and $ 274.84 for the six months ended June 30, 2023 and 2022, respectively.

The repurchased shares during the three and six months ended June 30, 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 six months ended June 30, 2023 excluded $ 3.1 million of open market purchases with trade dates in June 2023 that settled in July 2023 and $ 0.7 million of excise tax accrued.

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

The cash paid for repurchased shares during the three months ended June 30, 2023 included $ 2.0 million of open market purchases with trade dates in March 2023 that settled in April 2023, and excluded $ 3.1 million of open market purchases with trade dates in June 2023 that settled in July 2023.

The cash paid for repurchased shares during the three months ended June 30, 2022 included $ 12.1 million of open market purchases with trade dates in March 2022 that settled in April 2022, and excluded $ 7.0 million of open market purchases with trade dates in June 2022 that settled in July 2022.

(1) The average purchase price for repurchased shares was $ 341.11 and $ 254.71 for the three months ended September 30, 2023 and 2022, respectively, and $ 330.50 and $ 272.84 for the nine months ended September 30, 2023 and 2022, respectively.

The repurchased shares during the three and nine months ended September 30, 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 nine months ended September 30, 2023 excluded $ 15.0 million of open market purchases with trade dates in September 2023 that settled in October 2023 and $ 2.8 million of excise tax accrued.

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 three months ended September 30, 2023 included $ 3.1 million of open market purchases with trade dates in June

2023 that settled in July 2023, and excluded $ 15.0 million of open market purchases with trade dates in September 2023 that settled in October 2023.

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.

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 June 30, 2023

Three Months Ended September 30, 2023

Interest Rate

2 unchanged sentences

Adjustments Total

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

Balance – June 30, 2023 $ ( 31,596 ) $ ( 4,180 ) $ ( 49,351 ) $ ( 85,127 )

Other comprehensive income (loss) activity during the period:

2 unchanged sentences

Other comprehensive income (loss), net 3,707 33 ( 13,171 ) ( 9,431 )

Balance – June 30, 2023 $ ( 31,596 ) $ ( 4,180 ) $ ( 49,351 ) $ ( 85,127 )

Three Months Ended June 30, 2022

Balance – September 30, 2023 $ ( 27,889 ) $ ( 4,147 ) $ ( 62,522 ) $ ( 94,558 )

Three Months Ended September 30, 2022

Interest Rate

2 unchanged sentences

Adjustments Total

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

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

Other comprehensive income (loss) activity during the period:

2 unchanged sentences

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

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

Six Months Ended June 30, 2023

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

Nine Months Ended September 30, 2023

Interest Rate

7 unchanged sentences

Other comprehensive income (loss), net 11,359 100 ( 4,407 ) 7,052

Balance – June 30, 2023 $ ( 31,596 ) $ ( 4,180 ) $ ( 49,351 ) $ ( 85,127 )

Six Months Ended June 30, 2022

Balance – September 30, 2023 $ ( 27,889 ) $ ( 4,147 ) $ ( 62,522 ) $ ( 94,558 )

Nine Months Ended September 30, 2022

Interest Rate

7 unchanged sentences

Other comprehensive income (loss), net 13,125 ( 52 ) ( 62,190 ) ( 49,117 )

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

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

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

(2) $ 5.1 million of the reclassifications related to interest rate swaps (cash flow hedges) were recorded in Interest expense, net, for both the three months ended June 30, 2023 and 2022, respectively.

$ 10.2 million and $ 12.3 million of the reclassifications related to interest rate swaps (cash flow hedges) were recorded in Interest expense, net, for the six months ended June 30, 2023 and 2022, respectively See Note 8 — Debt and Note 11 — Derivatives and Hedging for information regarding the cash flow hedges.

(2) $ 4.9 million and $ 5.2 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, 2023 and 2022, respectively.

$ 15.2 million and $ 17.5 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, 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 June 30, 2023 that is expected to be reclassified into earnings within the next 12 months is $ 19.5 million.

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, 2023 that is expected to be reclassified into earnings within the next 12 months is $ 19.3 million.

Note 10 — Income Taxes

The provision for income taxes was $ 66.1 million and $ 71.0 million for the three months ended June 30, 2023 and 2022, respectively.

The effective income tax rate was 25.0 % and 25.7 % for the three months ended June 30, 2023 and 2022, respectively.

The decrease in the effective income tax rate was primarily due to higher tax benefits from stock-based compensation in the three months ended June 30, 2023 as compared to the same period in 2022.

The provision for income taxes was $ 151.6 million and $ 113.6 million for the six months ended June 30, 2023 and 2022, respectively.

The effective income tax rate was 23.5 % and 23.1 % for the six months ended June 30, 2023 and 2022, respectively.

The increase in the year to date effective income tax rate in 2023 was primarily due to the sale of the TalentNeuron business.

The Company had gross unrecognized tax benefits of $ 145.2 million on June 30, 2023 and $ 137.2 million on December 31, 2022.

The provision for income taxes was $ 44.5 million and $ 58.5 million for the three months ended September 30, 2023 and 2022, respectively.

The effective income tax rate was 19.8 % and 25.2 % for the three months ended September 30, 2023 and 2022, respectively.

The decrease in the effective income tax rate was primarily due to the favorable impact of a foreign tax credit notice issued by the IRS as well as the expiration of statutes for uncertain tax positions in the three months ended September 30, 2023 as compared to the same period in 2022.

The provision for income taxes was $ 196.0 million and $ 172.1 million for the nine months ended September 30, 2023 and 2022, respectively.

The effective income tax rate was 22.5 % and 23.8 % for the nine months ended September 30, 2023 and 2022, respectively.

The decrease in the year to date effective income tax rate in 2023 was primarily due to the impact of valuation allowance releases and the expiration of statutes for uncertain tax positions in the nine months ended September 30, 2023 as compared to the same period in 2022.

The 2023 decrease was partially offset by an increase in the effective income tax rate for the sale of the TalentNeuron business.

The Company had gross unrecognized tax benefits of $ 140.1 million on September 30, 2023 and $ 137.2 million on December 31, 2022.

It is reasonably possible that gross unrecognized tax benefits will decrease by approximately $ 5.3 million within the next twelve months due to the anticipated closure of audits and the expiration of certain statutes of limitation.

3 unchanged sentences

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

June 30, 2023

September 30, 2023

Derivative Contract Type Number of

27 unchanged sentences

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 June 30, 2023 matured before July 31, 2023.

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

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

At June 30, 2023, all of the Company’s derivative counterparties were investment grade financial institutions.

At September 30, 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 Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

Amount recorded in:

7 unchanged sentences

The Company’s financial instruments include cash equivalents, fees receivable from customers, accounts payable and accrued liabilities, all of which are normally short-term in nature.

The Company believes that the carrying amounts of these financial instruments reasonably approximate their fair values due to their short-term nature.

The Company believes that the carrying amounts of these financial

instruments reasonably approximate their fair values due to their short-term nature.

The Company’s financial instruments also include its outstanding variable-rate borrowings under the 2020 Credit Agreement.

17 unchanged sentences

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 June 30,

Description September 30,

2023 December 31,

20 unchanged sentences

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.

This valuation is 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.

2 unchanged sentences

Carrying Amount Fair Value

June 30, December 31, June 30, December 31,

September 30, December 31, September 30, 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 six months ended June 30, 2023, the Company recorded impairment charges of $ 10.0 million and $ 18.7 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 and nine months ended September 30, 2023, the Company recorded impairment charges of $ 0.3 million and $ 19.0 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.

10 unchanged sentences

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

As of June 30, 2023, the Company did not have any material payment obligations under any such indemnification agreements.

As of September 30, 2023, the Company did not have any material payment obligations under any such indemnification agreements.

Note 14 — Leases

14 unchanged sentences

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 Six Months Ended

Three Months Ended Nine Months Ended

September 30,

2023 2022 2023 2022

6 unchanged sentences

Right-of-use assets obtained in exchange for new operating lease liabilities $ 1,476 $ 7,438 $ 9,467 $ 19,120

(1) Included in operating lease cost was $ 10.8 million and $ 10.4 million for the three months ended June 30, 2023 and 2022, respectively, and $ 21.4 million and $ 20.9 million for the six months ended June 30, 2023 and 2022, respectively for costs related to subleasing activities.

(1) Included in operating lease cost was $ 10.9 million and $ 10.4 million for the three months ended September 30, 2023 and 2022, respectively, and $ 32.3 million and $ 31.3 million for the nine months ended September 30, 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.

2 unchanged sentences

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).

June 30, December 31,

September 30, December 31,

Accounts payable and accrued liabilities $ 98,686 $ 99,717

3 unchanged sentences

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 months ended June 30, 2023 and 2022 of $ 10.0 million and $ 11.6 million, respectively, and $ 18.7 million and $ 35.5 million for the six months ended June 30, 2023 and 2022, 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 $ 7.1 million and $ 7.6 million related to right-of-use assets and $ 2.9 million and $ 4.0 million related to other long-lived assets, primarily leasehold improvements, for the three months ended June 30, 2023 and 2022, respectively.

The impairment losses recorded include $ 13.4 million and $ 25.3 million related to right-of-use assets and $ 5.3 million and $ 10.2 million related to other long-lived assets, primarily leasehold improvements, for the six months ended June 30, 2023 and 2022, respectively.

As a result of the evaluation, the Company recognized impairment losses during the three months ended September 30, 2023 and 2022 of $ 0.3 million and $ 2.0 million, respectively, and $ 19.0 million and $ 37.5 million for the nine months ended September 30, 2023 and 2022, 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 $ 0.2 million and $ 1.7 million related to right-of-use assets and $ 0.1 million and $ 0.3 million related to other long-lived assets, primarily leasehold improvements, for the three months ended September 30, 2023 and 2022, respectively.

The impairment losses recorded include $ 13.6 million and $ 27.0 million related to right-of-use assets and $ 5.4 million and $ 10.5 million related to other long-lived assets, primarily leasehold improvements, for the nine months ended September 30, 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.

Note 15 — Subsequent Event

On October 31, 2023, the Company’s Board of Directors authorized incremental share repurchases of up to an additional $ 500.0 million of Gartner’s common stock.

This authorization is in addition to the previously authorized repurchases of up to $ 4.2 billion, which, as of the end of October 2023, had approximately $ 500.0 million remaining.

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