Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
IT (Gartner) delivered FY2025 revenue growth of 3.7% to $6.50B, but net income fell sharply by 41.8% to $729M, primarily driven by a surge in share buybacks and higher SG&A costs that compressed margins and eroded stockholders' equity by 76.5%.
Revenue
$6.5B
+3.67% YoY
EPS (Diluted)
$9.65
-39.69% YoY
Gross Margin
68.8%
+0.5 pts YoY
Operating Income
$1.03B
-11.29% YoY
Source: SEC XBRL
Gartner (IT) reported FY2025 revenue of $6.5B, up 3.7% year over year. Operating margin was 15.8%, down 2.6 points from 18.4% a year earlier. Operating cash flow was $1.29B, down 13.1% year over year.
Last 4 quarters: 4 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026 | 4.37 | 3.87 | Beat +13.1% |
| Mar 2026 | 3.32 | 3.00 | Beat +10.6% |
| Dec 2025This filing | 3.94 | 3.61 | Beat +9.1% |
| Sep 2025 | 2.76 | 2.50 | Beat +10.4% |
Reported EPS of $3.94 versus the $3.61 analyst consensus — a +9.1% beat for Dec 2025.
Compiled by AI from this SEC filing
Total revenue grew 3.7% year-over-year to $6.50B in FY2025 (from $6.27B in FY2024), with gross profit rising 4.5% to $4.47B, reflecting continued demand for Gartner's research and advisory services. Gross margin improved modestly to 68.8% from 68.3%.
Source: 10-K Income Statement
Operating income fell 11.3% to $1.03B as SG&A expenses increased 6.3% to $3.07B, outpacing revenue growth and compressing operating margin from 18.4% to 15.8%. This suggests increased investment in sales force and administrative infrastructure.
Source: 10-K Income Statement
Share buybacks surged 170.8% to $1.99B in FY2025 (from $735M in FY2024), driving financing cash outflows of $1.44B and reducing stockholders' equity by 76.5% to just $320M. This capital return strategy significantly reduced the equity base.
Source: 10-K Cash Flow Statement & Balance Sheet
Net income dropped 41.8% to $729M from $1.25B in the prior year, with net margin compressing to 11.2%. The decline reflects both higher operating costs and likely increased interest expense from a 21.0% rise in long-term debt to $2.98B.
Source: 10-K Income Statement & Balance Sheet
Cash and equivalents fell 10.9% to $1.72B, while operating cash flow declined 13.1% to $1.29B. Free cash flow (operating cash flow minus capex) remained positive but under pressure, as the company prioritized returning capital to shareholders over balance sheet preservation.
Source: 10-K Cash Flow Statement
Compiled by AI from this SEC filing · 2 high, 3 medium, 0 low
Stockholders' equity collapsed 76.5% to $320M while total liabilities rose 8.2% to $7.77B, resulting in a debt-to-equity ratio of approximately 24.3x. Long-term debt increased 21.0% to $2.98B, leaving the company with very limited financial flexibility if business conditions deteriorate.
Source: 10-K Balance Sheet
The current ratio stands at approximately 0.999, meaning current liabilities of $4.07B essentially equal current assets of $4.07B. This near-parity leaves little buffer for unexpected short-term cash needs and could constrain operational flexibility.
Source: 10-K Balance Sheet
SG&A expenses grew 6.3% to $3.07B, significantly outpacing revenue growth of 3.7%, which drove operating margin down 270 basis points to 15.8%. If this cost trajectory continues without a corresponding acceleration in revenue, profitability will face further pressure.
Source: 10-K Income Statement
Operating cash flow declined 13.1% to $1.29B, reducing the company's ability to self-fund operations, debt service, and capital returns simultaneously. With $1.99B in share buybacks funded partly by debt, the sustainability of this capital allocation strategy is a concern.
Source: 10-K Cash Flow Statement
Gartner's business model is heavily dependent on retaining and growing its research subscription base. Any slowdown in enterprise IT spending or client budget cuts could disproportionately impact renewal rates and revenue visibility, given the high fixed-cost structure implied by the SG&A base.
Source: 10-K Income Statement
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 6.50 $B | 6.27 $B | +3.67% |
Cost of Revenue $B | 2.05 $B | 2.02 $B | +1.51% |
Gross Profit $B | 4.47 $B | 4.28 $B | +4.46% |
Operating Income $B | 1.03 $B | 1.16 $B | -11.29% |
Net Income $B | 0.73 $B | 1.25 $B | -41.85% |
EPS (Basic) $ | 9.68 $ | 16.12 $ | -39.95% |
EPS (Diluted) $ | 9.65 $ | 16.00 $ | -39.69% |
SG&A Expense $B | 3.07 $B | 2.88 $B | +6.34% |
Answers draw on this SEC filing and the data on this page
Gartner's Q2 FY2026 revenue edged down 1% due to the Digital Markets sale, but net income rose 14% to $275.5 million on cost reductions and a gain on divestiture.
Gartner (IT) delivered a strong Q1 2026 with operating income up 13.7% YoY to $316.1M and EPS surging 17.3% to $3.18 diluted, despite a slight 1.5% revenue decline to $1.51B, driven by aggressive cost discipline and record share buybacks of $534.6M.
Other companies in IT Consulting & Other Services