Forrester Research — Q3 2026 Earnings Summary

Financial Performance:

• Total revenues for the quarter ended September 30, 2026, were $86.1 million, a decline from $94.3 million in the same period in 2025.
• Contract value was $281.9 million, down 3.5% year-over-year.
• GAAP net loss was $4.4 million ($0.23 per diluted share), compared to a net loss of $2.1 million ($0.11 per diluted share) in 2025.
• Adjusted net income was $4.7 million ($0.24 per diluted share), down from $7.2 million ($0.37 per diluted share) in 2025.
• Adjusted net income excludes stock-based compensation of $2.6 million, amortization of acquisition-related intangible assets of $2.1 million, and a restructuring credit of $0.5 million.
• Cash, cash equivalents, and marketable investments were $117.6 million as of September 30, 2026, compared to $127.7 million in 2025.
• Deferred revenue was $135.0 million as of September 30, 2026, down from $141.8 million in 2025.
• Debt outstanding was $30.0 million as of September 30, 2026, down from $35.0 million in 2025.
• Net cash provided by operating activities was $33.4 million for the nine months ended September 30, 2026, compared to $24.3 million in the same period in 2025.
• Repurchases of common stock totaled $11.3 million for the nine months ended September 30, 2026, compared to $2.4 million in 2025.
• Payments of debt totaled $5.0 million for the nine months ended September 30, 2026.

Guidance and Future Outlook:

• Full-year 2026 GAAP total revenue guidance is approximately $350.0 million to $360.0 million, representing a decline of 11.8% to 9.3% versus the prior year.
• Full-year 2026 GAAP operating margin guidance is approximately negative 3.3% to negative 2.8%.
• Full-year 2026 GAAP diluted loss per share guidance is approximately $0.79 to $0.74.
• Full-year 2026 Adjusted operating margin guidance is approximately 6.0% to 6.5%.
• Full-year 2026 Adjusted diluted earnings per share guidance is approximately $0.77 to $0.82.
• Management raised the low end of the 2026 earnings per share guidance.
• Management expects AI enhancements to deliver improved results for the remainder of the year and into 2027.

Business Segments and Product Lines:

• Research segment revenue was $70.1 million for the quarter, down from $72.7 million in 2025.
• Consulting segment revenue was $14.7 million for the quarter, down from $21.5 million in 2025.
• Events segment revenue was $1.2 million for the quarter, up from $0.2 million in 2025.
• New product launches include AI Access Plus, Team Solutions, and an integration with Claude.
• Client retention rate was 78% as of September 30, 2026, compared to 74% in 2025.
• Wallet retention rate was 89% as of September 30, 2026, compared to 86% in 2025.
• Total headcount was 1,337 as of September 30, 2026, down from 1,485 in 2025.

Market and Competitive Landscape:

• Forrester positions itself as one of the most influential research and advisory firms, focusing on an AI-driven world.
• The company notes that the use of generative AI by competitors is a factor in the competitive landscape.
• Industry consolidation is cited as a potential risk factor.

Risks and Challenges:

• Risks include the ability to retain and enrich memberships for research products and services.
• Economic conditions, including trade policies and tariffs, could reduce technology spending or demand.
• Dependence on key personnel and the ability to attract and retain professional staff are identified risks.
• Potential network disruptions, security breaches, and failure to enforce intellectual property rights are noted.
• The impact of outstanding debt obligations and taxation risks are highlighted.
• Future impairment charges remain a potential risk.

Management Commentary and Tone:

• CEO George F. Colony stated the business is seeing stabilization with results above consensus and prudent expense management.
• Management described their AI focus as "deliberate and intentional" and emphasized advancing the product roadmap.
• The tone regarding the stock buyback program was positive, citing it as a strong component of the current strategy.

Other Key Points:

• A goodwill impairment charge of $10.8 million was recorded in the nine months ended September 30, 2026, compared to $83.9 million in the same period in 2025.
• A credit loss on a note receivable from the divestiture of a product line in 2024 of $0.9 million is excluded from adjusted results for the current period, compared to $6.4 million in 2025.
• The company undertakes no obligation to update forward-looking statements.