Gartner (IT) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue reached $1.5 billion, up 5.4% year-over-year, with Research and Conferences segments showing strong growth and Consulting declining slightly.

• Net income surged to $415 million, up 130.6% year-over-year, driven by a $300 million event cancellation insurance gain.

• Adjusted EBITDA was $340 million, up 2.1% year-over-year; adjusted EPS was $2.50, down 2.3% year-over-year.

• Free cash flow reached $565 million, benefiting from insurance proceeds; operating cash flow was $591 million.

• Strong client value proposition, sales hiring, and AI initiatives support long-term double-digit growth.

Financial highlights

• Q3 2024 revenue was $1.5 billion, up 5% year-over-year as reported and 5.6% FX neutral.

• Research revenue grew 5.1% to $1.28 billion; Conferences revenue rose 32.5% to $76 million; Consulting revenue declined 3.9% to $128 million.

• Contract value ended Q3 at $5 billion, up 7.3% year-over-year.

• Adjusted EBITDA margin was 22.9%; total contribution margin was 68%; research contribution margin was 74%.

• Free cash flow conversion (rolling four quarters) was 119% of GAAP net income.

Outlook and guidance

• 2024 guidance raised: consolidated revenue of at least $6.23 billion, adjusted EBITDA of at least $1.52 billion, and adjusted EPS of at least $11.75.

• Free cash flow guidance increased to at least $1.35 billion for 2024, including insurance proceeds.

• Research revenue expected at least $5.11 billion, conferences at least $580 million, consulting at least $535 million.

• Medium-term model unchanged: 12%-16% research contract value growth to drive double-digit revenue growth and modest EBITDA margin expansion.

• Quota-bearing sales headcount expected to increase mid-single digits by year-end 2024.