UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
	For the quarterly period ended June 30, 2021
	OR
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

Commission File Number 1-14443

Gartner, Inc.

(Exact name of Registrant as specified in its charter)

Delaware	04-3099750
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification Number)
P.O. Box 10212	06902-7700
56 Top Gallant Road	(Zip Code)
Stamford,
Connecticut
(Address of principal executive offices)

Registrant’s telephone number, including area code: (203) 316-1111

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $.0005 par value per share	IT	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☑	Accelerated filer	☐	Non-accelerated filer	☐
		Smaller reporting company	☐	Emerging growth company	☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of July 30, 2021, 83,648,748 shares of the registrant’s common shares were outstanding.

1

Table of Contents

	Page
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (Unaudited)
Condensed Consolidated Balance Sheets at June 30, 2021 and December 31, 2020	3
Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2021 and 2020	4
Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months Ended June 30, 2021 and 2020	5
Condensed Consolidated Statements of Changes in Stockholders' Equity for the Three and Six Months Ended June 30, 2021 and 2020	6
Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2021 and 2020	7
Notes to Condensed Consolidated Financial Statements	8
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	26
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	39
ITEM 4. CONTROLS AND PROCEDURES	40
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS	41
ITEM 1A. RISK FACTORS	41
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	41
ITEM 6. EXHIBITS	42

2

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

GARTNER, INC. AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Unaudited; in thousands, except share data)

	June 30,		December 31,
	2021		2020
Assets
Current assets:
Cash and cash equivalents	$	796,257	$	712,583
Fees receivable, net of allowances of $8,000 and $10,000, respectively	1,102,562		1,241,508
Deferred commissions	248,447		259,755
Prepaid expenses and other current assets	109,900		109,212
Total current assets	2,257,166		2,323,058
Property, equipment and leasehold improvements, net	309,222		336,765
Operating lease right-of-use assets	618,132		647,283
Goodwill	2,955,466		2,945,547
Intangible assets, net	775,479		806,998
Other assets	272,875		256,316
Total Assets	$	7,188,340	$	7,315,967
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable and accrued liabilities	$	752,241	$	952,431
Deferred revenues	2,152,043		1,974,548
Current portion of long-term debt	5,322		20,515
Total current liabilities	2,909,606		2,947,494
Long-term debt, net of deferred financing fees	2,457,854		1,958,286
Operating lease liabilities	745,108		780,166
Other liabilities	548,134		539,593
Total Liabilities	6,660,702		6,225,539
Stockholders’ Equity
Preferred stock, $0.01 par value, 5,000,000 shares authorized; none issued or outstanding	—		—
Common stock, $0.0005 par value, 250,000,000 shares authorized; 163,602,067 shares issued for both periods	82		82
Additional paid-in capital	2,031,726		1,968,930
Accumulated other comprehensive loss, net	(82,978)		(99,228)
Accumulated earnings	2,690,803		2,255,467
Treasury stock, at cost, 79,464,479 and 74,759,985 common shares, respectively	(4,111,995)		(3,034,823)
Total Stockholders’ Equity	527,638		1,090,428
Total Liabilities and Stockholders’ Equity	$	7,188,340	$	7,315,967

See the accompanying notes to Condensed Consolidated Financial Statements.

3

GARTNER, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Operations

(Unaudited; in thousands, except per share data)

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Revenues:
Research	$	1,003,238	$	875,329	$	1,982,970	$	1,784,620
Conferences	58,179		317		82,981		14,187
Consulting	105,902		97,489		205,406		193,219
Total revenues	1,167,319		973,135		2,271,357		1,992,026
Costs and expenses:
Cost of services and product development	350,802		322,551		685,269		663,829
Selling, general and administrative	488,496		494,840		975,751		991,479
Depreciation	25,851		22,728		51,601		45,245
Amortization of intangibles	26,154		31,208		56,668		63,387
Acquisition and integration charges	1,302		2,157		1,942		3,716
Total costs and expenses	892,605		873,484		1,771,231		1,767,656
Operating income	274,714		99,651		500,126		224,370
Interest expense, net	(27,390)		(30,296)		(53,539)		(56,644)
Gain on event cancellation insurance claims	135,545		—		135,545		—
Other (expense) income, net	(3,682)		(10,399)		11,808		(11,915)
Income before income taxes	379,187		58,956		593,940		155,811
Provision for income taxes	107,951		3,879		158,604		25,637
Net income	$	271,236	$	55,077	$	435,336	$	130,174
Net income per share:
Basic	$	3.16	$	0.62	$	5.00	$	1.46
Diluted	$	3.13	$	0.61	$	4.95	$	1.45
Weighted average shares outstanding:
Basic	85,712		89,323		87,032		89,271
Diluted	86,589		89,780		87,921		89,967

See the accompanying notes to Condensed Consolidated Financial Statements.

4

GARTNER, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Comprehensive Income

(Unaudited; in thousands)

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Net income	$	271,236	$	55,077	$	435,336	$	130,174
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments	4,639		23,817		5,316		(22,564)
Interest rate swaps – net change in deferred gain or loss	5,457		2,900		10,727		(41,832)
Pension plans – net change in deferred actuarial loss	104		80		207		159
Other comprehensive income (loss), net of tax	10,200		26,797		16,250		(64,237)
Comprehensive income	$	281,436	$	81,874	$	451,586	$	65,937

See the accompanying notes to Condensed Consolidated Financial Statements.

5

GARTNER, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Changes in Stockholders’ Equity

(Unaudited; in thousands)

Three and Six Months Ended June 30, 2021

	Common Stock		Additional Paid-In Capital		Accumulated Other Comprehensive Loss, Net		Accumulated Earnings		Treasury Stock		Total
Balance at December 31, 2020	$	82	$	1,968,930	$	(99,228)	$	2,255,467	$	(3,034,823)	$	1,090,428
Net income	—		—		—		164,100		—		164,100
Other comprehensive income	—		—		6,050		—		—		6,050
Issuances under stock plans	—		(1,543)		—		—		6,923		5,380
Common share repurchases	—		—		—		—		(410,450)		(410,450)
Stock-based compensation expense	—		36,086		—		—		—		36,086
Balance at March 31, 2021	$	82	$	2,003,473	$	(93,178)	$	2,419,567	$	(3,438,350)	$	891,594
Net income	—		—		—		271,236		—		271,236
Other comprehensive income	—		—		10,200		—		—		10,200
Issuances under stock plans	—		2,063		—		—		2,017		4,080
Common share repurchases	—		—		—		—		(675,662)		(675,662)
Stock-based compensation expense	—		26,190		—		—		—		26,190
Balance at June 30, 2021	$	82	$	2,031,726	$	(82,978)	$	2,690,803	$	(4,111,995)	$	527,638

Three and Six Months Ended June 30, 2020

	Common Stock		Additional Paid-In Capital		Accumulated Other Comprehensive Loss, Net		Accumulated Earnings		Treasury Stock		Total
Balance at December 31, 2019	$	82	$	1,899,273	$	(77,938)	$	1,988,722	$	(2,871,546)	$	938,593
Net income	—		—		—		75,097		—		75,097
Other comprehensive loss	—		—		(91,034)		—		—		(91,034)
Issuances under stock plans	—		(1,794)		—		—		7,448		5,654
Common share repurchases	—		—		—		—		(63,164)		(63,164)
Stock-based compensation expense	—		25,129		—		—		—		25,129
Balance at March 31, 2020	$	82	$	1,922,608	$	(168,972)	$	2,063,819	$	(2,927,262)	$	890,275
Net income	—		—		—		55,077		—		55,077
Other comprehensive income	—		—		26,797		—		—		26,797
Issuances under stock plans	—		3,223		—		—		867		4,090
Common share repurchases	—		—		—		—		(698)		(698)
Stock-based compensation expense	—		15,678		—		—		—		15,678
Balance at June 30, 2020	$	82	$	1,941,509	$	(142,175)	$	2,118,896	$	(2,927,093)	$	991,219

6

GARTNER, INC. AND SUBSIDIARIES

Condensed Consolidated Statements of Cash Flows

(Unaudited; in thousands)

	Six Months Ended
	June 30,
	2021		2020
Operating activities:
Net income	$	435,336	$	130,174
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization	108,269		108,632
Stock-based compensation expense	62,276		40,807
Deferred taxes	2,294		(1,813)
Reduction in the carrying amount of operating lease right-of-use assets	37,261		43,256
Amortization and write-off of deferred financing fees	1,914		5,392
Amortization of deferred swap losses from de-designation	—		10,320
Gain on de-designated swaps	(11,751)		—
Changes in assets and liabilities:
Fees receivable, net	132,650		261,124
Deferred commissions	10,494		31,255
Prepaid expenses and other current assets	(822)		14,202
Other assets	(23,769)		(932)
Deferred revenues	190,814		(149,615)
Accounts payable and accrued and other liabilities	(212,321)		(93,885)
Cash provided by operating activities	732,645		398,917
Investing activities:
Additions to property, equipment and leasehold improvements	(24,479)		(45,865)
Acquisitions - cash paid (net of cash acquired)	(22,774)		—
Cash used in investing activities	(47,253)		(45,865)
Financing activities:
Proceeds from employee stock purchase plan	9,414		9,719
Proceeds from borrowings	600,000		800,000
Payments of deferred financing fees	(6,045)		(10,516)
Proceeds from revolving credit facility	—		327,000
Payments on revolving credit facility	(5,000)		(475,000)
Payments on borrowings	(105,256)		(853,094)
Purchases of treasury stock	(1,083,350)		(73,862)
Cash used in financing activities	(590,237)		(275,753)
Net increase in cash and cash equivalents and restricted cash	95,155		77,299
Effects of exchange rates on cash and cash equivalents	(7,281)		(1,502)
Cash and cash equivalents, beginning of period	712,583		280,836
Cash and cash equivalents and restricted cash, end of period	$	800,457	$	356,633

See the accompanying notes to Condensed Consolidated Financial Statements.

7

GARTNER, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 1 — Business and Basis of Presentation

Business. Gartner, Inc. (NYSE: IT) is the world’s leading research and advisory company and a member of the S&P 500. We equip business leaders with indispensable insights, advice and tools to achieve their mission–critical priorities today and build the successful organizations of tomorrow. We believe our unmatched combination of expert-led, practitioner-sourced and data-driven research steers clients toward the right decisions on the issues that matter most. We are a trusted advisor and an objective resource for more than 14,000 enterprises in more than 100 countries — across all major functions, in every industry and enterprise size.

Segments. Gartner delivers its products and services globally through three business segments: Research, Conferences and Consulting. Revenues and other financial information for our segments are discussed in Note 7 — Segment Information.

Basis of presentation. The accompanying interim Condensed Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”), as defined in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 270 for interim financial information and with the applicable instructions of U.S. Securities and Exchange Commission (“SEC”) Rule 10-01 of Regulation S-X on Form 10-Q, and should be read in conjunction with the consolidated financial statements and related notes of the Company in its Annual Report on Form 10-K for the year ended December 31, 2020.

The fiscal year of Gartner is the twelve-month period from January 1 through December 31. 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, 2021 may not be indicative of the results of operations for the remainder of 2021 or beyond. When used in these notes, the terms “Gartner,” the “Company,” “we,” “us,” or “our” refer to Gartner, Inc. and its consolidated subsidiaries.

Principles of consolidation. The accompanying interim Condensed Consolidated Financial Statements include the accounts of the Company and its wholly-owned subsidiaries. All significant intercompany transactions and balances have been eliminated.

Use of estimates. The preparation of the accompanying interim Condensed Consolidated Financial Statements requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Such estimates include the valuation of fees receivable, goodwill, intangible assets and other long-lived assets, as well as tax accruals and other liabilities. In addition, estimates are used in revenue recognition, income tax expense or benefit, performance-based compensation charges, depreciation and amortization. Management believes its use of estimates in these interim Condensed Consolidated Financial Statements to be reasonable.

Management continually evaluates and revises its estimates using historical experience and other factors, including the general economic environment and actions it may take in the future. Management adjusts these estimates when facts and circumstances dictate. However, these estimates may involve significant uncertainties and judgments and cannot be determined with precision. In addition, these estimates are based on management’s best judgment at a point in time. As a result, differences between estimates and actual results could be material and would be reflected in the Company’s consolidated financial statements in future periods.

Cash and cash equivalents and restricted cash. For the six months ended June 30, 2021, the end of period cash and cash equivalents and restricted cash balance of $800.5 million in the accompanying Condensed Consolidated Statements of Cash Flows consisted of $796.3 million of cash and cash equivalents and $4.2 million of restricted cash. The restricted cash was classified in Other Assets in the accompanying Condensed Consolidated Balance Sheets as of June 30, 2021.

Revenue recognition. Revenue is recognized in accordance with the requirements of FASB ASC Topic 606, Revenue from Contracts with Customers (“ASC Topic 606”). Revenue is only recognized when all of the required criteria for revenue recognition have been met. The accompanying Condensed Consolidated Statements of Operations present revenue net of any sales or value-added taxes that we collect from customers and remit to government authorities. ASC Topic 270 requires certain disclosures in interim financial statements around the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Note 4 — Revenue and Related Matters provides additional information regarding the Company’s revenues.

8

Gain on event cancellation insurance claims. In May 2021, the Company received $150.0 million of proceeds related to 2020 event cancellation insurance claims, and recorded a pre-tax gain of $135.5 million. The Company does not record any gain on insurance claims in excess of expenses incurred until the receipt of the insurance proceeds is deemed to be realizable.

Adoption of new accounting standards. The Company adopted the accounting standard described below during the six months ended June 30, 2021.

Simplifying the Accounting for Income Taxes — In December 2019, the FASB issued ASU No. 2019-12, Income Taxes—Simplifying the Accounting for Income Taxes (“ASU No. 2019-12”). ASU No. 2019-12 provides new guidance to simplify the accounting for income taxes in certain areas, changes the accounting for select income tax transactions and makes minor ASC improvements. Gartner adopted ASU No. 2019-12 on January 1, 2021. The adoption of ASU No. 2019-12 did not have a material impact on the Company’s Condensed Consolidated Financial Statements.

Accounting standards issued but not yet adopted. The FASB has issued accounting standards that have not yet become effective and may impact the Company’s consolidated financial statements or related disclosures in future periods. Those standards and their potential impact are discussed below.

Accounting standard effective immediately upon voluntary election by Gartner

Reference Rate Reform — In March 2020, the FASB issued ASU No. 2020-04, Reference Rate Reform—Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU No. 2020-04”). ASU No. 2020-04 provides that an entity can elect not to apply certain required modification accounting in U.S. GAAP to contracts where all changes to the critical terms relate to reference rate reform (e.g., the expected discontinuance of LIBOR and the transition to an alternative reference interest rate, etc.). In addition, the rule provides optional expedients and exceptions that enable entities to continue to apply hedge accounting for hedging relationships where one or more of the critical terms change due to reference rate reform. The rule became effective for all entities as of March 12, 2020 and will generally no longer be available to apply after December 31, 2022. The Company is currently evaluating the potential impact of ASU No. 2020-04 on its consolidated financial statements, including the rule’s potential impact on any debt modifications or other contractual changes in the future that may result from reference rate reform.

Note 2 — Acquisition

On June 17, 2021, the Company acquired 100% of the outstanding capital stock of Pulse Q&A Inc. (“Pulse”), a privately-held company based in San Francisco, California, for an aggregate purchase price of $30.0 million. Pulse is a technology-enabled community platform.

For cash flow reporting purposes, the Company paid $22.8 million in cash for Pulse after considering the cash acquired with the business, amounts held in escrow and certain other purchase price adjustments at closing. In addition to the purchase price, the Company may also be required to pay up to $4.5 million in cash in the future based on the continuing employment of certain key employees. Such amount will be recognized as compensation expense over three years and reported in Acquisition and integration charges in the Consolidated Statements of Operations.

The Company recorded $30.6 million of goodwill and finite-lived intangible assets for Pulse and $0.6 million of other liabilities on a net basis. The Company believes that the recorded goodwill is supported by the anticipated synergies resulting from the acquisition. None of the recorded goodwill will be deductible for tax purposes. The fair value measurements of the intangible assets were based primarily on an incremental profits valuation methodology, which includes significant unobservable inputs and thus represent a Level 3 measurement as defined in FASB ASC Topic 820. The allocation of the purchase price is preliminary with respect to certain tax matters and the finalization of working capital adjustments and the valuation of finite-lived intangible assets.

The operating results of the acquired Pulse business and the related goodwill are being reported as part of the Company’s Research segment. The operating results of Pulse have been included in the Company’s consolidated financial statements since the date of acquisition; however, such operating results were not material to the Company’s consolidated operating results and segment results. Had the Company acquired Pulse in prior periods, the impact on the Company’s operating results would not have been material and, as a result, pro forma financial information for prior periods has not been presented herein.

Note 3 — Goodwill and Intangible Assets

9

Goodwill

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.

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. If the Company does not believe 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, then no quantitative impairment test is performed. However, if the results of the qualitative assessment indicate that it is more likely than not that the fair value of a reporting unit is less than its respective carrying amount, then a quantitative impairment test is performed. Evaluating the recoverability of goodwill requires judgments and assumptions regarding future trends and events. As a result, both the precision and reliability of the estimates are subject to uncertainty.

The Company’s most recent annual impairment test of goodwill was a qualitative analysis conducted during the quarter ended September 30, 2020 that indicated no impairment. Subsequent to completing the 2020 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, 2021 (in thousands).

	Research		Conferences		Consulting		Total
Balance at December 31, 2020 (1)	$	2,664,732	$	184,091	$	96,724	$	2,945,547
Additions due to an acquisition (2)	11,172		—		—		11,172
Foreign currency translation impact	(1,398)		(20)		165		(1,253)
Balance at June 30, 2021 (1)	$	2,674,506	$	184,071	$	96,889	$	2,955,466

(1)The Company does not have any accumulated goodwill impairment losses.

(2)The additions were due to the acquisition of Pulse on June 17, 2021. See Note 2 — Acquisition 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, 2021	Customer Relationships		Software		Content		Other		Total
Gross cost at December 31, 2020	$	1,154,210	$	110,597	$	3,965	$	10,614	$	1,279,386
Additions due to an acquisition (1)	7,980		11,200		—		280		19,460
Intangible assets fully amortized	(17,788)		(60,631)		(3,965)		—		(82,384)
Foreign currency translation impact	7,895		226		—		—		8,121
Gross cost	1,152,297		61,392		—		10,894		1,224,583
Accumulated amortization (2)	(414,460)		(30,394)		—		(4,250)		(449,104)
Balance at June 30, 2021	$	737,837	$	30,998	$	—	$	6,644	$	775,479

December 31, 2020	Customer Relationships		Software		Content		Other		Total
Gross cost	$	1,154,210	$	110,597	$	3,965	$	10,614	$	1,279,386
Accumulated amortization (2)	(381,776)		(83,320)		(3,595)		(3,697)		(472,388)
Balance at December 31, 2020	$	772,434	$	27,277	$	370	$	6,917	$	806,998

(1) The additions were due to the acquisition of Pulse on June 17, 2021. See Note 2 — Acquisition for additional information.

(2) Finite-lived intangible assets are amortized using the straight-line method over the following periods: Customer relationships—6 to 13 years; Software—3 to 7 years; Content—2 to 3 years; and Other—2 to 11 years.

10

Amortization expense related to finite-lived intangible assets was $26.2 million and $31.2 million during the three months ended June 30, 2021 and 2020, respectively, and $56.7 million and $63.4 million during the six months ended June 30, 2021 and 2020. The estimated future amortization expense by year for finite-lived intangible assets is presented in the table below (in thousands).

2021 (remaining six months)	$	52,600
2022	101,768
2023	101,752
2024	94,540
2025	84,001
Thereafter	340,818
	$	775,479

Note 4 — Revenue and Related Matters

Disaggregated Revenue — The Company’s disaggregated revenue by reportable segment is presented in the tables below for the periods indicated (in thousands).

By Primary Geographic Market (1)

Three Months Ended June 30, 2021

Primary Geographic Market	Research		Conferences		Consulting		Total
United States and Canada	$	646,432	$	40,328	$	59,605	$	746,365
Europe, Middle East and Africa	236,756		14,468		35,459		286,683
Other International	120,050		3,383		10,838		134,271
Total revenues	$	1,003,238	$	58,179	$	105,902	$	1,167,319

Three Months Ended June 30, 2020

Primary Geographic Market	Research		Conferences		Consulting		Total
United States and Canada	$	573,245	$	317	$	58,017	$	631,579
Europe, Middle East and Africa	196,854		—		30,114		226,968
Other International	105,230		—		9,358		114,588
Total revenues	$	875,329	$	317	$	97,489	$	973,135

Six Months Ended June 30, 2021

Primary Geographic Market	Research		Conferences		Consulting		Total
United States and Canada	$	1,277,765	$	59,927	$	117,091	$	1,454,783
Europe, Middle East and Africa	466,957		17,181		65,821		$	549,959
Other International	238,248		5,873		22,494		$	266,615
Total revenues	$	1,982,970	$	82,981	$	205,406	$	2,271,357

Six Months Ended June 30, 2020

Primary Geographic Market	Research		Conferences		Consulting		Total
United States and Canada	$	1,163,400	$	6,297	$	112,181	$	1,281,878
Europe, Middle East and Africa	402,794		2,147		60,196		465,137
Other International	218,426		5,743		20,842		245,011
Total revenues	$	1,784,620	$	14,187	$	193,219	$	1,992,026

11

(1)Revenue is reported based on where the sale is fulfilled.

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, 2021

Timing of Revenue Recognition	Research		Conferences		Consulting		Total
Transferred over time (1)	$	916,754	$	—	$	85,989	$	1,002,743
Transferred at a point in time (2)	86,484		58,179		19,913		164,576
Total revenues	$	1,003,238	$	58,179	$	105,902	$	1,167,319

Three Months Ended June 30, 2020

Timing of Revenue Recognition	Research		Conferences		Consulting		Total
Transferred over time (1)	$	810,564	$	—	$	68,630	$	879,194
Transferred at a point in time (2)	64,765		317		28,859		93,941
Total revenues	$	875,329	$	317	$	97,489	$	973,135

Six Months Ended June 30, 2021

Timing of Revenue Recognition	Research		Conferences		Consulting		Total
Transferred over time (1)	$	1,810,841	$	—	$	170,331	$	1,981,172
Transferred at a point in time (2)	172,129		82,981		35,075		290,185
Total revenues	$	1,982,970	$	82,981	$	205,406	$	2,271,357

Six Months Ended June 30, 2020

Timing of Revenue Recognition	Research		Conferences		Consulting		Total
Transferred over time (1)	$	1,639,776	$	—	$	150,038	$	1,789,814
Transferred at a point in time (2)	144,844		14,187		43,181		202,212
Total revenues	$	1,784,620	$	14,187	$	193,219	$	1,992,026

(1)Research revenues were recognized in connection with performance obligations that were satisfied over time using a time-elapsed output method to measure progress. Consulting revenues were recognized over time using labor hours as an input measurement basis.

(2)The revenues in this category were recognized in connection with performance obligations that were satisfied at the point in time that the contractual deliverables were 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 are unsatisfied (or partially unsatisfied) as of June 30, 2021 was approximately $3.7 billion. The Company expects to recognize $1,229.3 million, $1,754.2 million and $676.9 million of this revenue (most of which pertains to Research) during the remainder of 2021, the year ending December 31, 2022 and thereafter, respectively. The Company applies a practical expedient that is permitted under ASC Topic 606 and, accordingly, it does not disclose such performance obligation information for customer contracts that have original durations of one year or less. The Company’s performance obligations for contracts meeting this ASC Topic 606 disclosure exclusion primarily include: (i) stand-ready services under Research subscription contracts; (ii) holding conferences and meetings where attendees and exhibitors can participate; and (iii) providing customized Consulting solutions for clients under fixed fee and time and materials engagements.

12

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 consolidated balance sheet. 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,
	2021		2020
Assets:
Fees receivable, gross (1)	$	1,110,562	$	1,251,508
Contract assets recorded in Prepaid expenses and other current assets (2)	$	22,637	$	14,440
Contract liabilities:
Deferred revenues (current liability) (3)	$	2,152,043	$	1,974,548
Non-current deferred revenues recorded in Other liabilities (3)	31,826		26,754
Total contract liabilities	$	2,183,869	$	2,001,302

(1)Fees receivable represent an unconditional right to payment from the Company’s customers and include both billed and unbilled amounts.

(2)Contract assets represent recognized revenue for which the Company does not have an unconditional right to payment as of the balance sheet date because the project may be subject to a progress billing milestone or some other billing restriction.

(3)Deferred revenues represent amounts (i) for which the Company has received an upfront customer payment or (ii) that pertain to recognized fees receivable. Both situations occur before the completion of the Company’s performance obligation(s).

The Company recognized revenue of $817.3 million and $692.6 million during the three months ended June 30, 2021 and 2020, respectively, and $1,261.9 million and $1,087.9 million during the six months ended June 30, 2021 and 2020, respectively, that was attributable to deferred revenues that were recorded at the beginning of each such period. Those amounts primarily consisted of (i) Research revenues that were recognized ratably as control of the goods or services passed to the customer and (ii) Conferences revenue pertaining to conferences and meetings that occurred during the reporting periods. During each of the three and six months ended June 30, 2021 and 2020, the Company did not record any material impairments related to its contract assets. The Company does not typically recognize revenue from performance obligations satisfied in prior periods.

Note 5 — Computation of Earnings Per Share

Basic earnings per share (“EPS”) is computed by dividing net income by the weighted average number of shares of Common Stock outstanding during the period. Diluted EPS reflects the potential dilution of securities that could share in earnings. Potential shares of common stock are excluded from the computation of diluted earnings per share when their effect would be anti-dilutive.

The table below sets forth the calculation of basic and diluted income per share for the periods indicated (in thousands, except per share data).

13

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2021		2020		2021		2020
Numerator:
Net income used for calculating basic and diluted income per share	$	271,236	$	55,077	$	435,336	$	130,174
Denominator:
Weighted average common shares used in the calculation of basic income per share	85,712		89,323		87,032		89,271
Dilutive effect of outstanding awards associated with stock-based compensation plans (1)	877		457		889		696
Shares used in the calculation of diluted income per share	86,589		89,780		87,921		89,967
Basic income per share	$	3.16	$	0.62	$	5.00	$	1.46
Diluted income per share	$	3.13	$	0.61	$	4.95	$	1.45

(1)Certain potential shares of common stock were not included in the computation of diluted income per share because the effect would have been anti-dilutive. For the three and six months ended June 30, 2021, approximately 0.1 million shares of common stock equivalents were excluded for both periods from the calculation of diluted income per share because they were anti-dilutive. For the three and six months ended June 30, 2020, approximately 1.3 million and 0.8 million shares of common stock equivalents, respectively, were excluded because of their anti-dilutive effect.

Note 6 — Stock-Based Compensation

The Company grants stock-based compensation awards as an incentive for employees and directors to contribute to the Company’s long-term success. 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, 2021, the Company had 4.2 million shares of its common stock, par value $0.0005 per share, (the “Common Stock”) available for stock-based compensation awards under its current Long-Term Incentive Plan as amended and restated in January 2019 (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,
Award type	2021		2020		2021		2020
Stock appreciation rights	$	2.0	$	1.9	$	4.0	$