$IT · GARTNER INC
Gartner filed its 10-Q for Q3 FY2026 ended September 30, 2026. Total revenues declined 1.3% YoY to $1.505B, with the "Other" segment dropping to zero from $55.2M. Net income surged to $214.4M ($3.35 diluted EPS) from $35.4M ($0.47) a year ago, when a $150M goodwill impairment crushed earnings. Operating income more than tripled to $281.1M. The company repurchased $1.2B in stock over nine months, reducing basic shares outstanding by 14.9% YoY to 63.75M.
- Q3 FY2026 net income: $214.4M vs $35.4M in Q3 FY2025 — a 506% increase driven by absence of $150M goodwill impairment
- Q3 diluted EPS: $3.35 vs $0.47 YoY; nine-month diluted EPS: $10.66 vs $6.35
- Q3 operating income: $281.1M (18.7% margin) vs $86.3M YoY; nine-month operating income: $975.7M vs $691.5M
- Insights segment revenue grew 2% YoY to $1.29B; Conferences up 15% to $86M; Consulting up 2% to $126.4M
- Share count dropped sharply: basic shares 63.75M vs 74.88M YoY — a 14.9% reduction from aggressive buybacks
Extended-hours last trade at $221.00, down 6.15% from the $235.49 regular close, suggesting the market is selling despite the massive YoY earnings improvement — possibly on the -1.3% total revenue decline or the negative stockholders' deficit of $34.7M.
The 506% net income surge and massive share-count reduction signal powerful capital allocation, but the negative equity position and revenue contraction complicate the bull case.
Gartner's core Insights subscription business shows steady 2% growth, consistent with the resilient demand for enterprise IT research. The aggressive buyback program — retiring ~15% of shares YoY — mirrors capital-return strategies seen across mature information-services peers.
Total stockholders' equity flipped to a deficit of $34.7M from positive $319.9M at year-end 2025, driven by $1.2B in share repurchases over nine months. Negative equity raises leverage concerns with $2.98B in long-term debt outstanding. Interest expense rose 45% YoY to $23.6M in Q3.