Gartner delivered stronger adjusted earnings and cash flow in the third quarter, while contract value growth accelerated and management raised its full-year 2026 outlook. The headline GAAP revenue decline was distorted by the sale of its Digital Markets operation.
- Adjusted EPS rose 30.1% to US$3.59
- FX-neutral contract value increased 2.5% year on year
- Adjusted EBITDA excluding the divested operation rose 7.5% to US$364 million
- Free cash flow increased 2.2% to US$275 million
- Full-year 2026 revenue, EBITDA, EPS and free cash flow guidance increased
Gartner, Inc. (NYSE:IT) raised its full-year 2026 revenue, adjusted EBITDA, adjusted EPS and free cash flow outlook after a quarter in which contract value growth accelerated and adjusted earnings beat management’s expectations. Adjusted EPS rose 30.1% to US$3.59, while diluted GAAP EPS climbed to US$3.35 from US$0.47 a year earlier.
Contract value growth points to firmer demand
The more forward-looking contract value measure increased 2.5% year on year on an FX-neutral basis to US$5.3 billion, and rose 1.1% sequentially. Global Technology Sales contract value grew 2.1% year on year, while Global Business Sales increased 3.7%, with both measures also improving from the previous quarter.
That momentum sits alongside a more complicated revenue picture. Reported revenue fell 1.3% to US$1.505 billion, but adjusted revenue, which excludes the divested Digital Markets operation, rose 2.4% to the same US$1.505 billion. The comparison is therefore not like-for-like: the prior-year quarter included US$55 million of revenue from the operation Gartner sold in February 2026.
Profit growth benefits from an impairment-affected comparison
GAAP net income jumped 506% to US$214 million, but the comparison is heavily influenced by the US$150 million goodwill impairment recorded in the prior-year quarter. Adjusted EBITDA excluding the divested operation rose 7.5% to US$364 million, a measure that Gartner says is intended to provide a more consistent view of recurring operations.
The operating segments delivered uneven but broadly positive growth. Insights revenue increased 1.7% to US$1.292 billion, Conferences revenue rose 15.4% to US$86 million, and Consulting revenue grew 2.3% to US$126 million. Conferences also produced the strongest gross-contribution growth, up 9.8%, while Consulting gross contribution increased 21.3%.
Cash generation supports continued buybacks
Operating cash flow was US$294 million, down 1.4% year on year, while free cash flow increased 2.2% to US$275 million after US$19 million of capital expenditure. Gartner repurchased 0.9 million shares for US$138 million during the quarter and said it had bought back US$1.7 billion of stock over the past four quarters.
The improved outlook is the clearest market signal in the release, although the filing does not provide the revised full-year guidance figures. The next test is whether contract value growth can continue to translate into reported revenue after the Digital Markets divestiture rolls out of the comparison, while adjusted earnings remain dependent on metrics that exclude acquisition amortisation and other specified items.
Bottom Line?
Gartner’s raised outlook rests on improving contract value and cash generation, but the next quarters will show how much of the earnings lift is operational rather than comparison-driven.
Questions in the middle?
- What are the precise revised 2026 guidance ranges, and how much higher are they than the previous outlook?
- Can contract value growth remain above revenue growth as the Digital Markets divestiture fully passes through the comparisons?
- Will the pace of share repurchases continue without constraining investment in Gartner’s core businesses?