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Date

Tuesday, Feb. 3, 2026 at 8 a.m. ET

Call participants

  • Chief Executive Officer — Gene Hall
  • Chief Financial Officer — Craig Safian

Takeaways

  • Revenue -- $1.8 billion in fiscal Q4 ended Dec. 31, 2025, up 2% as reported; fiscal year revenue was $6.5 billion, up 4% as reported and 3% FX neutral.
  • Contract value (CV) -- Fiscal Q4 global CV up 1%; outside U.S. federal government, CV grew 4%.
  • EBITDA -- $436 million in fiscal Q4, up 5% as reported; margin was 24.9%, up approximately 60 basis points from last year.
  • Full-year EBITDA -- $1.6 billion, margin 24.8%.
  • Adjusted EPS -- $3.94 in fiscal Q4; $13.17 for the fiscal year.
  • Free cash flow -- $271 million in fiscal Q4; $1.2 billion for the fiscal year.
  • Shares outstanding -- 72 million at fiscal Q4, 8% reduction year over year, with $2 billion repurchased during 2025.
  • Segment revenue -- Fiscal Q4 Insights revenue up 3% as reported; fiscal Q4 Conferences revenue $286 million, with 8% FX-neutral same-conference growth; fiscal Q4 Consulting revenue $134 million, compared with $153 million prior year.
  • Segment contribution margins -- Fiscal Q4 Insights 77%; fiscal Q4 Conferences 51%; fiscal Q4 Consulting 27%.
  • Contract value by segment -- Insights CV $5.2 billion at fiscal Q4 end, up 1%; GTS CV $3.9 billion, flat; GBS CV $1.2 billion, up 3%, with GBS outside U.S. federal government up around 6%.
  • Return on invested capital (ROIC) -- Around 24% for the fiscal year.
  • Fiscal 2026 guidance -- Insights revenue at least $5.19 billion (1% FX-neutral growth), Conferences at least $695 million (7% FX-neutral), Consulting at least $570 million (3% FX-neutral), consolidated revenue at least $6.455 billion (2% FX-neutral).
  • 2026 profitability outlook -- EBITDA of at least $1.515 billion, margin of at least 23.5%; adjusted EPS at least $12.30; free cash flow at least $1.135 billion, and 140% conversion from GAAP net income.
  • Divestiture -- Entered definitive agreement to sell digital markets business, with historical financials updated to reflect the divestiture.
  • Operational transformation -- Transformation underway in content creation across four dimensions: "impact, volume, timeliness, and user experience," with new AI-driven tools and process improvements.
  • AI client engagement -- Over 6,000 AI-related documents, 1,000+ unique use cases, 200,000+ in-depth client conversations, and 500,000 AskGartner questions handled in 2025.
  • AskGartner rollout -- Launched August, completed October; licensed users showed significantly higher renewal rates.
  • Magic Quadrant production -- Content creation time reduced by 75% compared to 2024.
  • Share repurchase authorization -- Board refreshed authorization to $1.2 billion as of fiscal Q4 end.
  • Leverage and liquidity -- Gross debt $3 billion, gross debt to trailing-twelve-month EBITDA at 1.9x, $2.7 billion liquidity, and 100% fixed interest rates.
  • Fiscal Q1 2026 guidance -- Adjusted EBITDA of at least $370 million.
  • Federal government headwinds -- Vast majority of U.S. federal contracts renewed during 2025; U.S. federal CV $126 million at year end.

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Risks

  • Craig Safian said, "we do believe that that 23 and a half is the the new baseline, if you will. And we should be able to expand our margins going forward," after guiding 2026 EBITDA margin below 2025 actuals, indicating a margin reset due to "selected investments."
  • Gene Hall said, "These external market forces led to increased scrutiny, elevated deal approval authority, and extended buying cycles. Over the past few years, including 2025, the rate of change and volatility in the external environment has increased significantly. Executives have responded to this by slowing and deferring everything possible. This makes for a much tougher selling environment," referencing persistent demand headwinds.
  • Craig Safian noted "GTS new business of more than $300 million was down about 5% the US federal government," revealing softening in new bookings for the segment.
  • Craig Safian stated, "Q4 consulting revenue was $134 million compared with $153 million in the year-ago period," signaling year-over-year decline in consulting segment revenue.

Summary

Gartner (IT 21.40%) delivered fiscal Q4 results with revenues, margins, and free cash flow all surpassing initial guidance and 8% fewer shares outstanding after $2 billion in stock repurchases. Management emphasized ongoing transformation, leveraging AI and new content processes to drive engagement and faster, more relevant insight delivery, highlighted by a 75% reduction in certain research production times and expanded Magic Quadrant outputs. A definitive agreement has been reached to divest the digital markets business, streamlining focus and updating all historical financials; meanwhile, full-year ROIC remains robust, and 2026 guidance reflects accelerating contract value growth across core research and conferences. Lower 2026 EBITDA margins are explicitly framed as a new baseline, with margin expansion tied to longer-term CV acceleration rather than immediate performance improvement.

  • Directors were added and board committee chairs rotated, as management described "The changes we made in the second half of last year were more changed than we've ever done at Gartner. You know, I've been here twenty-one years. In my in that entire time, it's more change than we've ever done." to processes and personnel in the past two decades.
  • AI-related initiatives and AskGartner usage drove demonstrably higher client retention among users, but these early impacts were described as requiring multiple years to fully influence renewal and growth cycles.
  • Federal government headwinds are expected to abate from Q2 onward as nearly all applicable contracts have already renewed or churned; tariff-driven industries have mostly stabilized, but pockets of weakness remain, such as oil producers facing falling commodity prices.
  • Business developer additions and AI-enabled sales training were highlighted as strategies to improve quota-bearing headcount productivity and support medium-term revenue growth, with new business growth in GTS and GBS segments flat to slightly down in the most recent quarter.
  • Craig Safian clarified that the margin reset incorporates an operating expense plan growing approximately 4%-5% FX-neutral, mainly from merit increases and selected structural investments.

Industry glossary

  • AskGartner: AI-based client tool for retrieving, summarizing, and personalizing Gartner's research content for licensed users.
  • Contract value (CV): The annualized value of all active subscription-based client contracts as of a given period-end.
  • GTS (Global Technology Sales): The Gartner business segment focused on technology clients, including vendors and service providers.
  • GBS (Global Business Sales): The Gartner segment selling to clients outside of technology vendor markets, such as legal, finance, or supply chain functions.
  • NCVI: Net contract value increase, representing the period-over-period change in contract values for a given segment or geography.

Full Conference Call Transcript

Gene Hall: Good morning. Thanks for joining us today. Fourth quarter revenue, EBITDA, margins, EPS, and free cash flow were ahead of expectations. We continued to deliver great value to our clients. We were agile in managing expenses. And we repurchased more than $2 billion of Gartner stock in 2025. 2025 was a unique year due to a range of external market forces. Department of government efficiency or dose-related initiatives affected our US federal clients. Evolving trade policies created complexity for tariff-impacted enterprises. Funding changes affected our state and local government and education clients. Tech companies that are not in or adjacent to AI experienced a shifting landscape. And there were country-specific factors in several geographies.

These external market forces led to increased scrutiny, elevated deal approval authority, and extended buying cycles. Over the past few years, including 2025, the rate of change and volatility in the external environment has increased significantly. Executives have responded to this by slowing and deferring everything possible. This makes for a much tougher selling environment. The value bar is higher. But it's also a huge opportunity for us. Clients know they need help with these issues. Gartner is an insights business. Our high-value forward-looking insights help clients on their journeys to achieve their mission-critical priorities. The key to capturing an opportunity while operating under deferred decision-making and higher value standards is to help clients engage more frequently with our insights.

Clients who engage frequently with our insights receive greater value and retain at higher rates. This was true in 2025, and every year prior. And it's still true today. Client engagement increased modestly throughout 2025. But in today's world, client engagement levels need to be even higher. Because the rate of change is faster than ever, driving incremental improvements on our standard practices wasn't enough. To achieve step-change improvements, we needed to rethink many of our processes and practices. So we've been driving transformation across business and technology insights. We covered some aspects of this transformation on previous earnings calls. Today, I'll share a comprehensive view of what we're doing. We're transforming business and technology insights along four dimensions.

Impact, volume, timeliness, and user experience. Beginning with impact. Our insights provide tremendous value to clients today. And we know we can get even better. Our objective is to ensure insights are always on the topics our clients care about most right now. The biggest example today is AI. AI is transforming the world. It's our highest demand topic. During 2025, we expanded our AI insights. We have more than 6,000 AI-related documents in our library. We've documented more than 1,000 unique use cases. In 2025, we conducted more than 200,000 in-depth client conversations on AI. And we answered more than 500,000 AI-related questions through AskGartner.

Based on our analytical measures, the impact of our insights is improving at a rapid pace. By increasing the impact of our insights, we can ensure our clients get even more value on the topics they care most about at any given time. The second dimension is volume. We serve clients of every size, in every industry and every enterprise function in 90 countries. This diverse set of clients has differing mission-critical priorities. Our objective is to increase the number of insights to accommodate the broadest range of client priorities. To achieve this, we're applying automation, streamlining processes, and upgrading and upscaling our analyst teams.

We developed a neural network AI model to quickly and systematically determine the topics our clients care about most. As of 2025, our active insights library has grown by approximately 50%. By increasing volume, we can better accommodate the full range of our clients' mission-critical priorities. The third dimension is timeliness. The pace of the world continues to accelerate. Some say, the rate of change will never be this slow again. We're ensuring our insights keep pace with the ever-accelerating pace of the world. We've introduced insight types, that are produced the same day as important events occur in the world. Such as a major security breach, where clients need immediate guidance.

Or in the rapidly evolving world of AI, where major changes happen every day. To support this, we've made two other innovations. First, we introduced new processes to create insights as quickly as the same day. Second, for insight types that are highly valued by our clients, such as Magic Quadrants, we've reduced our average insight creation time by 75% compared to 2024. So we'll continue to ensure our insights keep pace with the ever-accelerating pace of the world. The fourth element is user experience. If we produce great insights, but our clients can't find them, they won't receive value from them. Historically, the single biggest feedback from our clients was Gartner produces tremendous insights.

But I can't always find them. We're ensuring our clients can easily access the insights that are most relevant to them when they need them the most. AskGartner leverages AI to quickly identify and summarize the right high-value insights across our BaaS library. It leverages role, function, mission-critical priorities, insight viewership histories, and more. To make his responses even more relevant to each licensed user. We began rolling out AskGartner in August. Completed the rollout in October. Licensed users who used AskGartner had substantially higher renewal rates than those who did not, even with the same levels of engagement. We'll continuously improve and innovate AskGartner's capabilities. Separately, we're identifying role-specific insights each week that are particularly valuable and broadly applicable.

Our goal is to ensure clients have every opportunity to engage with these uniquely valuable insights. We're also changing how we deliver insights in terms of format and access to meet today's client preferences. Conferences are an important way clients engage with our insights. Destination conferences provide high value to clients. But not all our clients can attend our destination conferences. For these clients, we launched Gartner C-level communities. Gartner C-level communities are local, peer-driven one-day events where C-level executives can gain access to our insights. We're continuing to expand both our destination conferences and Gartner C-level communities in 2026 and beyond.

We'll continue to improve the user experience to ensure our clients can access the insights they need to achieve their mission-critical priorities. So we're driving transformation across business and technology insights along four dimensions. Impact, volume, timeliness, and user experience. We began driving these transformational improvements during 2025, and will continue during 2026 and beyond. We believe this transformation will provide a step change in the value to our clients over the next few years. In addition, we'll drive continuous improvement and innovation across the rest of the business.

During 2025, we also took several shareholder value-enhancing actions, including repurchasing $2 billion of Gartner stock, increasing leverage with a successful inaugural investment-grade bond offering to support even more share repurchase capacity. Adding two new directors, who bring unique and valuable skills to our board, rotating our board committee chairs, and entering into a definitive agreement to sell our digital markets business. In summary, the world is changing more than ever before. This represents a huge opportunity for us. Gartner is an insights business that guides the leaders who shape the world. The key to capturing our opportunity while operating under a challenging selling environment is to help clients engage more frequently with our insights.

In 2025, we began transforming business and technology insights along four dimensions. Impact, volume, timeliness, and user experience. These transformations will allow us to thrive in a world with greater change and uncertainty than ever. We expect to see the impact over the next few years. We'll continue to keep you updated on our progress. With our unparalleled value proposition, continued transformation in business and technology insights, and responsible reinvestment in our business, contract value will accelerate. As contract value accelerates, our P&L and free cash flow conversion will follow. We will continue to create value for our shareholders by generating free cash flow in excess of net income, returning capital to our share repurchase program.

With that, I'll hand the call over to our Chief Financial Officer, Craig Safian.

Craig Safian: Thank you, Gene, and good morning. Today, I'm going to walk you through fourth quarter and full year 2025 results, and I will introduce our 2026 guidance. Financial results in the fourth quarter were better than expected. For the full year, revenue increased from 2024 and EBITDA margins finished well ahead of our initial guidance from last February. Our return on invested capital continues to be above 20%. Highlighting the strength of our business model, and our ongoing ability to create long-term value. We increased leverage with a successful bond offering. Our first as an investment-grade rated credit. We generated significant free cash flow and bought back about $2 billion of stock.

And last week, we entered into a definitive agreement to sell the digital markets business. Which allows us to focus even more on delivering insights to help our clients address their mission-critical priorities. Fourth quarter revenue was $1.8 billion. Up 2% year over year as reported and unchanged FX neutral. For the full year, revenue was $6.5 billion up 4% as reported and 3% FX neutral. Fourth quarter contract value or CV grew 1% year over year. Outside the US federal government, CV grew 4%. In the quarter, total contribution margin was 67%. Up 85 basis points from last year. EBITDA was $436 million. Up 5% as reported and 1% FX neutral. Adjusted EPS was $3.94.

And free cash flow was $271 million. For the full year, EBITDA was $1.6 billion EBITDA margins were 24.8%, well above the initial guidance we gave at the start of the year. Adjusted EPS was $13.17 Free cash flow is $1.2 billion. And ROIC was strong at around 24%. The Insight segment is our largest, most important business. It's subscription-based with strong retention, recurring revenue, and excellent contribution margins. We get paid upfront, which allows us to generate strong free cash flow, well in excess of net income. Insight's revenue in the quarter grew 3% year over year as reported and 1% as FX neutral. Fourth quarter insights contribution margin was 77%. Up 59 basis points versus last year.

Full year insights revenue increased 5% as reported and 4% FX neutral. For 2025, Insight's contribution margin was 77%. Up 14 basis points from 2024. Contract value was $5.2 billion at the end of the fourth quarter, up 1% versus the prior year. Outside the U.S. Federal government, CV growth was about three thirty basis points faster at around 4%. Global NCVI in the quarter outside the US federal government was positive $147 million. The vast majority of our US federal contracts came up for renewal during 2025. At December 31, we had $126 million of US federal CV. Outside the US Fed, we delivered CV growth across practices, industry sectors, company sizes, and geographic regions.

By sector, energy, banking, and technology led the growth. CV grew at high single-digit or mid-single-digit rates across all commercial enterprise sizes. All but two of our top 10 countries grew in 2025, with one growing double digits. And we had more than $400 million of new business in the fourth quarter. Global Technology sales contract value was $3.9 billion at the end of the fourth quarter, about flat compared with the prior year. GTS CV outside The US Federal business grew 4% in the quarter. Tech vendor CV increased mid-single digits. With services and software growing low double-digit or high single digits. Wallet retention for GTS was 96% for the quarter.

GTS new business of more than $300 million was down about 5% the US federal government. The change in GTS quota-bearing headcount was consistent with our expectations. We managed our territory changes and investments based on a balance of expense discipline, and opportunities to invest for growth. We've optimized territories with growth directed towards business developers and new logo and new business opportunities. BD productivity has remained strong, which is a foundation for our investment in adding BD. Our regular full set of GTS metrics can be found in our earnings supplement. Global business sales contract value was $1.2 billion at the end of the fourth quarter, up 3% year over year.

Outside the US federal government, GBS CV grew about 200 basis points faster at around 6%. Growth was led by the sales, supply chain, and legal practices. GBS NCVI was positive $16 million in the fourth quarter. Outside the US federal government, GBS NCVI was positive $21 million. Wallet retention for GBS was 99% for the quarter. Outside The US federal business, wallet retention was over 100%. CBS new business of more than $100 million was down 4% compared to last year. The change in GBS quota-bearing headcount was consistent with our expectations. Similar to GTS, we managed our territory changes and invest based on a balance of expense discipline, and opportunities to invest for growth.

BD productivity has remained strong, which is the foundation for our investment in adding BD. As with GTS, our regular full set of GBS metrics can be found in our earnings supplement. As we do each year at this time, we've also provided quarterly historical contract value data updated to 2026 FX rates on page 21 of the earnings supplement. As you build your 2026 models, please remember to use the updated data as the baseline for your forecasting. The US dollar weakened significantly over the course of 2025, causing this adjustment to be larger than most years.

We've also provided several quarters of historical data to reflect the updated financials for the digital markets divestiture on page 22 of the earnings supplement. Conferences revenue for the fourth quarter was $286 million On a same conference basis, revenue growth was around 8% FX neutral. Contribution margin was 51%. We held 14 destination conferences in the fourth quarter as planned. Full year conferences revenue grew 11% to $645 million FX neutral growth was 9%. Contribution margin was 50%. Q4 consulting revenue was $134 million compared with $153 million in the year-ago period. FX was a benefit of about 300 basis points in the quarter. Consulting contribution margin was 27% in Q4.

Full year consulting revenue was $552 million compared to $559 million in the prior year. Contribution margin was 34%. Consolidated cost of services on a GAAP basis was $573 million in the quarter or 32.7% of revenue. For the full year, cost of services was $2 billion or 31.6% of revenue. SG and A on a GAAP basis was $798 million in the quarter, or 45.5% of revenue. For the full year, SG and A was $3 billion or 47.2% of revenue. We continue to balance disciplined cost management while ensuring we can invest in key areas. Such as expert talent, AI, the customer experience, and frontline sellers. As a percentage of revenue, our costs are well below historical highs.

EBITDA for the fourth quarter was $436 million up 5% from last year's reported and 1% FX neutral. We outperformed in the fourth quarter through modest revenue upside, effective expense management, and a prudent approach to guidance. EBITDA margins were 24.9%, up about 60 basis points from last year's Q4. Full year EBITDA was $1.6 billion. Up 4% as reported and 2% FX neutral. EBITDA margins were 24.8% consistent with last year. Depreciation in the quarter was $28 million Full year depreciation was up 5%. Net interest expense before deferred financing cost in the quarter was $18 million. Increasing by $7 million versus the 2024 due to lower interest income on our cash balances.

The full year net interest expense before deferred financing cost was $56 million. Favorable by $10 million versus 2024, due to lower interest expense and higher interest income on our cash balances. The Q4 adjusted tax rate, which we use for the calculation of adjusted net income, was 20% for the quarter. This compares to last year's benefit of 25%. The tax rate for the items used to adjust that income was 3% for the quarter. The full year tax rate for the calculation of adjusted net income was 22%. In line with our expectations. The prior year tax rate benefited from favorable tax planning. Adjusted EPS in Q4 was $3.94. Full year adjusted EPS was $13.17.

We had 72 million shares outstanding in the fourth quarter. This is an improvement of about 6 million shares or approximately 8% year over year. We exited the fourth quarter with 71 million shares on an unweighted basis. Operating cash flow for the quarter was $295 million This compares with $335 million in Q4 2024. CapEx was $24 million flat year over year. Fourth quarter free cash flow was $271 million. This compares with $311 million in Q4 2024. For the full year, operating cash flow is $1.3 billion CapEx was $115 million and free cash flow is $1.2 billion. Free cash flow on a rolling four-quarter basis was 161% of GAAP net income, and 73% of EBITDA.

As we previously noted, there were two items that affect rolling four-quarter net income and free cash flow, including a real estate lease termination payment in Q3 2025, and we also had a noncash goodwill impairment charge related to digital markets business in Q3 2025. Last week, we signed a definitive agreement to divest digital markets. Adjusting for these items, free cash flow on a rolling four-quarter basis was 18% of revenue, 74% of EBITDA, and 136% of GAAP net income. At the end of the fourth quarter, we had about $1.7 billion of cash. Our December 31 debt balance was $3 billion up about $500 million from Q3 as a result of our most recent bond offering.

Our reported gross debt to trailing twelve-month EBITDA was 1.9 times. Our expected free cash flow generation, available revolver, and excess cash remaining on the balance sheet provide ample liquidity to deliver on our capital allocation strategy. Our balance sheet is very strong. With $2.7 billion of liquidity, low levels of leverage, and 100% fixed interest rates. We repurchased about $500 million of stock during the fourth quarter and $2 billion during the full year. Last week, the board refreshed our authorization, bringing the total to about $1.2 billion. We expect the board will continue to refresh the authorization as needed.

As we continue to repurchase stock, we create value for shareholders through EPS accretion, and increasing returns on invested capital. Before providing the 2026 guidance details, I want to discuss our base level assumptions and planning philosophy for the year. We've not included the digital markets business in the outlook. For insights revenue, our guidance reflects Q4 2025 contract value and our CV growth rate accelerating over the course of 2026. First quarter and first half NCVI are important inputs to calendar 2026 revenue growth. We have taken a prudent view of NCVI phasing because Q1 is a seasonally important quarter for renewals. As always, we have high visibility into our insights revenue based on our ending 2025 contract value.

For conferences, we are basing our guidance on the 56 in-person destination conferences we have planned for 2026. We expect similar seasonality to what we saw in 2025 with We expect gross margins in the second quarter to be the highest of the year for the Conferences segment. Q4 the largest quarter followed by Q2. We had a strong advanced bookings quarter in Q4, which provides very good visibility to 2026 revenue. We have a majority of what we've guided already under contract. This is ahead of where we were at the same time last year. For consulting, we have more visibility into the next quarter or two based on the composition of our backlog and pipeline as usual.

Contract optimization has had several very strong years, and the business remains highly variable. Our base level assumptions for consolidated expenses reflect a run rate from the fourth quarter and merit increases scheduled to go into effect April 1, as usual. We recommend thinking about expenses sequentially with notable seasonality driven by the conference's calendar and annual merit increases. For GTS, we expect low single-digit QBH growth in 2026. With a focus on growth in our business developers. For GBS, we plan to grow QBH mid-single digits this year, with an emphasis on growth in business developers. We have the recruiting capacity to go faster depending on how the year plays out.

We continue to prudently manage our expenses, in part to create alignment with recent CV trends. And we are driving efficiencies wherever we can through automation, process improvements, and leveraging technology. We are also prioritizing sensible investments to drive future growth and returns. Which include key areas like business and technology insights analysts, artificial intelligence, the customer experience, and sales capabilities, efficiencies, and QBH. These investments are fully reflected in our 2026 guidance. Based on January FX rates, we expect revenue growth to benefit by about 110 basis points and EBITDA growth to benefit by about 170 basis points for the full year.

As a reminder, about one-third of our revenue and operating expenses are denominated in currencies other than the US dollar. Our 2026 guidance is as follows. We expect Insights revenue of $5.19 billion or more which is FX neutral growth of about 1%. We expect Conferences revenue of $695 million or more. Which is FX neutral growth of about 7%. We expect consulting revenue of $570 million or more, which is growth of about 3% FX neutral. The result is an outlook for consolidated revenue of $6.455 billion or more, which is FX neutral growth of 2%. We expect full-year EBITDA of $1.515 billion or more. This reflects full-year margins of 23.5% or more.

As we move through the year, our strong visibility will get even better. For net interest expense, we expect higher interest costs as a result of the increase in leverage. Interest income will be affected by interest rates and the deployment of cash for repurchases made during 2025. In addition, we have not assumed interest income on excess cash that could be deployed on share repurchases. Notably, however, our share count for 2026 only assumes repurchases to offset dilution. This means in the adjusted EPS guides, we have effectively assumed both less cash on the balance sheet and more shares outstanding than we are likely to have. We expect 2026 adjusted EPS of $12.30 or more.

As I just noted, EPS would see a significant positive impact through a combination of fewer shares, and or greater interest income. For 2026, we expect free cash flow of $1.135 billion or more. This reflects the conversion from GAAP net income of 140%. Our guidance is based on about 71 million shares outstanding. Again, only reflecting share repurchases to offset dilution. For Q1, we expect adjusted EBITDA of $370 million or more. Our financial results in Q4 were ahead of expectations. In particular, margins were strong and better than we guided at the start of 2025. We had another year of very strong free cash flow. ROIC continues to be excellent. We made significant accretive share repurchases.

Reducing our shares outstanding by 8% in the year. Contract value outside The US federal business grew 4% in the quarter. And we are positioned to accelerate CV growth throughout 2026. As Gene detailed, in 2025, we began driving transformation across business and technology insights along four dimensions. Impact, volume, timeliness, and user experience. The investments to continue the transformation through 2026 are fully reflected in our guidance. Finally, we'll continue to deploy our capital to drive shareholder value and contribute to strong ROIC. Our capital allocation strategy remains focused on share repurchases, which will lower the share count over time, and strategic value-enhancing tuck-in M&A.

With that, I'll turn the call back over to the operator, and we'll be happy to take your questions. Operator?

Operator: Thank you. If you'd like to ask a question, please press 11.

Jeffrey Meuler: If your question hasn't been answered and you'd like to remove yourself from the queue, please press 11 again. Our first question comes from Jeffrey Meuler with Baird. Yes. On the expected contract value acceleration as '26 unfolds, I guess there's going to be a mathematical benefit from moving past the peaking and lessening federal government headwind. Are you expecting acceleration beyond that on an ex-government or ex-federal government basis? And I'd imagine you expect some benefit from the step-function operational changes, but just if you can give us an update on what you're seeing in terms of any leading indicator KPIs you had talked about a lot of things last quarter, like in-quarter renewal rates.

Just wondering if those have continued to make progress.

Gene Hall: Yes. Hey, Jeff. Yes, we are expecting ACV to accelerate throughout the year. And not just because of lesser headwinds in the federal government. US federal government. Basically, it's as you said, we made more changes with 2026 and into 2027. And so it's really that's what's driving acceleration of CV over the year, over '26 and then '27 after that. And on some of the leading indicators and what you were seeing on things like in-quarter renewal rates, so the leading indicator the way that we're approaching the transformation is we know that if our clients engage with us more, they renew at higher rates. And so we're looking at leading indicators that say they're going to engage more.

With our content. And so there's things like, again, the important mention I talked about, we changed our content. One of the indicators we have is the conferences where we presented those new content. And our conference scores, we asked clients to rate each of the presentations as well as the overall conference. And those conference scores were up significantly and more than we've ever seen in the past. For the conferences that were held at the second half and particularly in Q4 of last year, but we have a lot of conferences. And so that's kind of one of the leading indicators that we see. As I mentioned also, engagement actually has been rising.

And as engagement rises, again, it doesn't when engagement goes up, it doesn't affect you today. When that client comes up for renewal over the next you know, depending on whether it's a single-year multi-year contract, when they come up over the next twelve or twenty-four months, they're much more likely to renew. So we see a positive impact from that as well. And so there's indicators like that are telling us that both our you know, the transformation we're meeting with BTI in terms of driving more engagements working. And in fact, we're seeing the beginnings of higher engagement as well. Like I mentioned, another one as well, which is the uptake of as I'm sorry.

The impact of AskGartner lets clients get access much better access for content than they've been able to do in the past. And as I mentioned, we only rolled it out to all of our clients in October, so we probably didn't have that much chance to use it. But for those clients that used it and then renewed last year, their renewal rates were actually significantly higher. I think it's a combination of both better access and also side of each transformation changes that we talked about earlier. If we look at leading indicators, we think that actually that we're on a good track.

And, again, these things will take because they have to use the content, they have to renew, and that renewal takes place over a twelve to twenty-four month period. It's gonna take a while for all these things to kick in, but I'd say the leading indicators we view is very positive.

Jeffrey Meuler: K. Thank you. Thank you.

Operator: Our next question comes from Andrew Nicholas with William Blair. Your line is open.

Andrew Nicholas: Hi, good morning. Just want to follow-up on the same kind of line of questioning. A couple of quarters ago, you talked about your hopes to kinda get back to the high single-digit range in terms of CV growth here in 2026. Just wondering you know, now a couple quarters past that, how you're thinking about that kinda line of thinking. And of the factors that you outlined at that time between the federal government business, tech vendors accelerating, you know, tariff-related industries or tariff-impacted industries. Normalizing some and your own internal adaptations. Is there any changes to kind of the magnitude of those benefits that you would speak to today versus, you know, six months ago? Thank you.

Craig Safian: Hey. Good morning, Andrew. It's Craig. So, you know, sort of headline answer, I'd say, is and just reiterating what Gene just said with the prior question is we do expect CV the CV growth rate to accelerate over the course of 2026, And that's obviously within our US Fed portion of the business. Just lapping the significant headwinds. And also the balance of the business accelerating as well. As you know, our normal course practice is not to guide specifically to CV. But we do fully expect all the factors that we've been discussing in details you know, Gene provided to support driving that CV growth. And also, all the factors we talked about are those different buckets.

We expect to have an impact as well into 2026. And so I think part of this is the environment still remains pretty chaotic. And we wanna see what the environment looks like as we move our way through 2026. But baked into our guide and baked into our all of our operating assumptions is the CV growth rate accelerating over the course of 2026.

Andrew Nicholas: Understood. Thank you.

Operator: Thank you. Our next question comes from Faiza Alwy with Deutsche Bank. Your line is open.

Faiza Alwy: Yes. Hi. Thank you. So just to on that, Craig, I think you talked about the quarterly phasing of CV growth. I'm curious if you expect sort of that quarterly phasing to be similar to what we have seen historically or if you could sort of put a put a finer point on that. I imagine you're expecting that know, some of the internal initiatives that you're taking will kinda help more towards the back half of the year, but any further perspective would be helpful.

Craig Safian: Yeah. Great question, Faiza. Thank you. So, you know, as we look at the way our CV expiration skew looks like for 2026, It looks pretty consistent with what we've what we've seen historically. So a little bit overweighted in terms of Dollars coming up for renewal in Q1 and Q4. So a little bit more than 25% in each of those quarters. And obviously a little bit less than 25% that implies in the middle quarters Q2 and Q3. As you know, and again, in our sort of NICFI build as we think about it, you we believe should be roughly consistent to what we've seen over the last several years.

That all said, the revenue guide is obviously most sensitive to where we ended 2025. And that contract value will matter as we roll into 2026. And then the phasing of the NCBI, to your point, one is we tend to generate much more of our NCCI in the second half of the year historically and then to emphasize your point and Gene's points too, is that the transformations that we've been doing, again, these are not just started on gen one. We've been you know, working through these for the last, you know, few quarters. But certainly, we'll have more of an impact in the second half of the year than on the first half of the year.

Faiza Alwy: Great. Thank you.

Operator: Thank you. Our next question comes from Joshua Chan with UBS. Your line is open.

Joshua Chan: Hi, good morning, Gene and Craig. Thanks for taking my question. I guess, stepping back from the numbers, it seems like in recent months, have taken some more kind of strategic steps, including the of the non-sub business. I think we understand you had an organizational realignment perhaps. So could you just talk about what drove these kind of more longer-term type actions? And kind of how you're thinking about those actions versus kind of the environment that you're sitting in? Thank you.

Gene Hall: Yeah. Josh, great question. So you know, the last year there were a lot of changes I think over the last two or three years, there's been a lot of changes between what's happened with AI, the US federal government tariffs, all the things I kind of outlined in my talk. And so during the first half of last year, we came to the conclusion that we should assume that the world's going to be like this forever. That there's going to be a lot more disruption and chaos And we don't know what those things are gonna be, but we need to prepare for them.

And so to do that, we've decided the best way to impact it in our business was to focus on our core BTI business, And on top of that, and within that, the way to optimize that business is to get more client engagement. When, as I mentioned in my remarks, the more clients engage with us, the higher the retention is. And the higher the retention is, obviously, the faster our business grows. And so we're really driving engagement and driving retention. And the way we're doing that is through this transformation program. We did a lot of analysis to understand what drives engagement. It's the four things I talked about.

It's the impact of our of our insights the number of insights we cover all the mission-critical priorities they have interest in, how fast we get it to them, especially in today's world where things change so quickly, I mean, user experience so they actually get access to them, whether it be through Ask Gartner or through enhanced conferences that I mentioned. The changes we made in the second half of last year were more changed than we've ever done at Gartner. You know, I've been here twenty-one years. In my in that entire time, it's more change than we've ever done.

And it's in a reaction to set to position the business so that even if the world gets better, that we can get back to the kind of growth rate that we've had historically, meaning the double-digit growth, even in really bad environment because we've enhanced our DTI health so much. And so as a result of that, two of the things you mentioned were as a result of that. So one of them, we decided that our digital market business didn't fit in that vision And so, we made the decision after careful analysis that didn't make sense.

And so we, you know, made an arrangement with things that is a very good owner for And then the second thing is there were some staff changes As we assess these this VTI transformation, in any transformation, you also find that people that don't have the skills today that you need going forward. And so for those people, we had a unfortunately, we had an action that we took so that we could basically reposition skills so that we have the skills we need going forward. Not the skills we did in the past. And that was only one small part of the transformation. But that was that was a part of the transformation.

So this had nothing to do with cost or something like that. It had to do with making sure we had the skills to address the impact, volume, timeliness, and user experience that we needed to business to thrive in any economic environment. And then and then, Josh, the one last thing I'd add is, you know, obviously, focused on you know, doing shareholder value-enhancing initiatives. The number one way we do that is to, you know, drive value for our clients, which then translates you know, through the P&L and free cash flow statement. But, obviously, we're focused on optimizing and maximizing shareholder value as well.

And you know our capital allocation strategy is around buybacks and potential value-enhancing M&A, tuck-in M&A, And so on the buybacks, as you saw noted, about $2 billion worth of shares repurchased over the course of 2025. Taking advantage of the debt markets and transforming, if you will, our balance sheet. So that we have a little bit more leverage and more capacity to deploy our capital on behalf of our shareholders. And then we do typically talk about M&A, but divestitures can be ways to drive shareholder value as well.

And as Gene outlined, I think you know, we came to the you know, through deep analysis, through the recognition that digital markets was not a core part of business. And so we look to drive value sell it to a more natural owner, and then from a shareholder value perspective, that allows us to use those proceeds, but also to focus on the core. Which is really driving, you know, value out of the PCI the insights business, I should say.

Joshua Chan: Great. Thank you both for the color.

Operator: Thank you. Our next question comes from Jason Haas with Wells Fargo. Your line is open.

Jason Haas: I'm curious as part of some of the internal improvements you're making, are there any changes to try to institutionalize some of the process that your analysts go through to collect proprietary insights from your customers? Because our understanding is you know, there's a treasure trove of data that your analysts are collecting, and I'm curious how much of that is coming through just sort of informal questioning, or is there really a process around that to drive the collection of those insights? Thank you.

Gene Hall: Jason, it's a great question. And it that is actually a core part of the BGI transformation as well. To your point, know, we have hundreds of thousands of conversations with our clients every year. And with also with technology vendors, we have thousands of conversations We have a lot of peer interactions where peers interact. We get all that data, which proprietary surveys. Challenge we have is with our 2,400 analysts, how do we get all the right information to those analysts?

And so as a part of this transformation action, we've developed some very sophisticated systems that let us get all get the insights that mattered most to the analysts that are gonna be actually working on particular topical area. Like cybersecurity or something like that. And it starts with this neural network-based system I talked about before, And it starts there because, know, one of the most important decisions we make is what do we actually write content on? What insights we wanna write on? This neural network basis that I talked about takes all of that input and says, what's trending? What are the things that people are most interested in?

By the way, it's updated on a real-time basis. So this week, what are what are our clients interested in? And then what assets do we have that can actually create incredible insight that we have high value to those clients? And so your point is actually a key part of the transformation is you know, the way we worked, you know, many years ago, was a bunch of analysts sat in a room and said, hey. What'd you hear? What I hear? Now, you know, with thousands of analysts and hundreds of thousands of conversations, we can't work that way.

And so we've leveraged technology including AI, so we can actually both write on the right topics by using this neural network model, and then get all the right assets that will help those analysts write truly insightful research into the hands of the right people. And so it's a core part of it.

Jason Haas: Thank you.

Operator: Thank you. Our next question comes from Toni Kaplan with Morgan Stanley.

Toni Kaplan: Thanks so much. I wanted to get a sense of in the fourth quarter, if AI sort of entered the renewal conversations a little bit more in terms of client decision-making around adding or removing seats and things like that. And I know you get a lot of feedback from your clients. So just wanted to hear sorta what you're hearing from them and is the environment you know, getting maybe a little bit better? Like, you know, just wanted to get a sense of sort of the client environment and feedback. Thanks.

Gene Hall: Yeah. Yeah, Tony. So you know, the single biggest issue we are helping our clients with is AI across every function. So our clients clearly understand AI. They know they have challenges with it. And, again, it's our single highest band item. And as I've talked about in the past, with our salespeople, we ask each salesperson to document any concerns clients have And one of the specific ones we ask them to document is if a client brings up that AI might be a substitute. And, in addition to that, we have a help desk. And so any salesperson that basically says, hey. The client said I'm thinking about using AI. Instead of Gartner. We try to document.

We train salespeople. And by the way, they use this system. Right? This is also tracks competitive. You know, threats and things like that. And so it's it is regularly used. Put in perspective, probably half our salespeople use it in any given year. And so they're familiar with it. And we train them on it. And, we have this help desk in case somebody has an AI question. And the help desk is like the mini type repairman. Which is to say that, you know, there that has not been we have a lot of challenges with clients in terms of their own internal budgets that these guys we talked about.

But one that we do not hear frequently is that they're thinking about using AI in some way to substitute for Gartner. And, again, to your point, I think you know, our salespeople, it's it's not if anything, Q4 is less of an issue or less of concern, than even before. But if we don't we try to track it very carefully. We try to get eyes open about it. And we don't see it as you know, as something that is restraining our growth. As opposed to clients that have tariffs and budget problems and the federal government doze things. Those are real problems that we have that we see every day.

Toni Kaplan: Do you see those problems getting better, the doge and tariff problems and things like that?

Gene Hall: So we'll approach it two different ways. So in terms of Doge, as we had talked about, all of our federal government clients US federal government, contracts virtually all of them are one-year contracts. And so any client that wanted to cancel because of Doge after Q1 will have already had the chance to cancel. And so we believe and there's still tremendous demand What's going on with the US federal government is we provide valuable services. The clients that are actually using our services, like chief information officers, etcetera, highly valuable use our services. They have tight budgets. They're getting direction from above. And so in some cases, they canceled our contracts.

Which is why we've had terrible renewal rates. We believe that ones that are going to cancel will have gone through it once we get through Q1, And that going forward, it'll be more to a normal environment the US government with shore value. But we provide a lot of value. We have a lot of clients who wanna buy from us. And so that's kind of how we're expecting there. Outside of federal government, tariff industry, it's it gets down to the VTI transfer I talked about earlier. Where you know, we made as I mentioned, we made more changes second half of last year than ever before.

And the whole idea is we need to increase value to our clients. We're gonna do that by increasing engagement. More they engage, the hard value they get, the more they renew. And we know if we get engagement rates up even modestly, it has a material impact on renewal rates and then our growth rate. And so we're the federal government, we're going to hopefully get through all the contracts with people that are gonna cancel. And, again, everyone else, and in fact, the federal government going forward, we're increasing the value that we provide to our clients at a much higher rate through the way talk about impact, volume, timeliness, and user experience.

Toni Kaplan: Thank you.

Operator: Thank you. Our next question comes from Surinder Thind with Jefferies. Your line is open.

Surinder Thind: Gene, could you maybe talk about your willingness to kind of maintain the medium-term guidance here. It seems like we've had a number of challenging years where there's always something that disrupts your ability to hit that medium-term guidance. And given the pace of change, what gives you confidence that you can achieve medium-term guidance? It just seems like you know, disruption is in the air at this point. So at least beyond you know, beyond you know, the current narrative here.

Gene Hall: Yeah. You know, as I mentioned earlier, we're taking the view that the world is always going to be more challenging than it was prior to a couple of years ago. And so because of that, we needed to really up our the value we provide to clients a lot. And so which we have a program to do it. The earliest I mentioned earlier in the call, actually, early indicators are good. It's gonna take time because, again, clients, we have to produce have to make the changes I talked about. Clients don't have to use them. Then that contract has to come up for renewal.

And so it's gonna take a couple of years before we get the full benefit of programs that we're just talking about. I have confidence that our CV will continue to accelerate over the time period because of the changes that we're making.

Craig Safian: And, Surinder, it's Craig. You know, they yeah. Kinda go back to every way we look at it. There is still a very large addressable market that we continue to figure out ways and unlock ways to go after that addressable market. The value we provide to our clients is unparalleled and unmatched. Again, all the things Gene outlined will allow us to continue to enhance and increase that value proposition. And then if you think about the four elements that Gene mentioned, all of those things you know, we believe will allow us to better penetrate and hold on to that huge addressable market opportunity. So there's really no change in our view on the market.

We know the value we provide to clients. We're focused on continuing to enhance that value and you know, we believe that, you know, all those things are unchanged in terms of the opportunity for us going forward.

Surinder Thind: That's helpful. And just a quick clarification here. I think, Gene, you mentioned this idea that, you know, to realize the benefit of the investments that you're making, it may be a few years. So is that the timeframe then for kind of getting to your medium-term guidance targets? I just wanted to clarify that.

Gene Hall: So basically, as I mentioned, the way we're gonna get benefits is we make the changes. And, again, we made a lot of change last year. It's not going to stop. We're going to continue making changes this year in the same quarters I talked about. Then clients have to use and benefit from them to actually get our insights and see the advantage of it. Then they ask them up for renewal. It's just the nature of our business because it's the subscription-based business. Can take a couple of years until you get the whole benefit of everything we're talking about.

Craig Safian: And just to underscore that, Surinder, I mean, the guide as we said, implies or overtly you know, has contract value growth rate reacceleration over the course of 2026. We don't expect to be done with that. In 2026. And so we believe all the things that we are doing, we continue to make sure we're you know, as both Gene and I mentioned, prioritizing the right kinds of investments to you know, drive that reacceleration and drive strong returns. On those investments in the future. And so you know, as we mentioned, no change in our view on the market.

We're doing all the right things we believe in terms of enhancing the value that we deliver to our clients. And then with continued reacceleration, you know, we believe we can drive lots of incremental shareholder value over the short, medium, and long term.

Surinder Thind: Thank you.

Operator: Our next question comes from Brendan J. Popson on behalf of Manav Patnaik with Barclays.

Brendan J. Popson: Good morning. This is Brendan on for Manav. I just wanna ask for some more. You talked about some of the rapid change internally, and I also noted you mentioned this 75% time reduction for Incyte. So I guess just any clarity on what exactly that means and just anything else on the internal changes to drive this better retention?

Gene Hall: Yeah, Brendan. As I mentioned, we're making these internal changes on impact volume time as a user experience. One important part of timeliness is actually how fast we can produce insights. And as we did this in-depth analysis in terms of how we produce insights, We've developed, you know, we basically decided in today's world where things happen so quickly, again, you look at, like, AI or cybersecurity, where things happen on a daily basis. We weren't operating that kind of space. And so beginning in July so these are not changes that happened like, you know, in January. It was beginning July. We looked at how could we take time out of the process.

And actually, it involved a couple of things. First is new content types. So, actually, we don't have content types like a thing called a first take that is if something happens today, you need to know about today. We get that first take out immediately because our clients do make decisions about it. The second area was actually then changing the process And in fact, we found that we had too many people in parts of the process. The back part of the process. So not the creative part, but the editing part. And so we actually downsized that part of the process When we chain and change processes or products, it was better.

The third thing we did is an automation. Part of the automation was AI. And so between you know, those three factors, different concept types restructured the process, and what its jobs are and then provide a lot of automation, including AI. Allowed us to shrink the production time which, again, today's world is really, really important. As I mentioned earlier, we started making these changes in July. And so these are part of you know, I mentioned we had more change than ever before in the second half of last year. This is one of those changes. Again, it involved restructurings as well as process changes. As well as substantive changes.

Brendan J. Popson: All right. Thank you.

Operator: Thank you. Our next question comes from Scott Wurtzel with Wolfe Research. Your line is open.

Scott Wurtzel: Hey, good morning, guys, and thank you for taking my questions. You talked a lot about sort of expanding the breadth of your offerings, the velocity of the insights, and the ease of use improvements as well. Just wondering if you can maybe talk about if there's any, you know, changes to your sales strategy or go-to-market strategy that you're thinking about for this year? And then if you can also help us with we should think about sort of the phasing of, you know, your quota-based headcount, quota-bearing headcount growth across GTS and GBS for 2026? Thanks.

Gene Hall: Yes, Scott. So I did not focus as much on sales because the VTI transformation is so much it's such depth and huge change for us. We've always done a lot of innovation in sales, and we continue those innovations. And so, like, again and I'll give you some examples. So one of them is that we know that our salespeople, they come in They have not typically been the C-level clients that they're selling to. So we need to get make sure they have the skills, the confidence We have very extensive training programs.

One of the things we've done to enhance that, which has actually worked out better than we expected, actually, is use AI-based role-play tools so that we can put a salesperson in a situation with these AI tools where they are talking to a prospect or a client about things like what's the value how you know, what questions they might have, you know, if I could just count. Why don't I give this kind of Whatever those questions might be, then our sales team likes to get practice ahead of time. And we've always done role plays. But adding AI-based tools has allowed us to exponentially explain those kinds of role plays.

And the sales teams love these tools because it makes them so much more efficient. Second thing we're doing is, we you know, there's content that you know, if you look at all the content we produce, we produce tons of it. What we've been doing is taking each week, what is the content that would be most valuable for a salesperson in their role? Whether they're selling CHROs, it would be one set of content. If they're selling CIOs, a different set. If there's only CFOs, different set. So for that week, if they had to be from one piece of content, what would it be? We do it every week.

So now we're doing is actually identifying that content, We have a whole process to get it after Salesforce and explain why they need to have that content, how they should talk about the clients, etcetera. It equips them to actually be much more substantive with our clients and confident on the issues that week are the most important, which is another piece we're doing. Another piece we're doing is expanding the role of business developers. And so we have very modest Salesforce expansion plan for 2026. One of the things that we found even last even last year, our business developer productivity has been actually quite strong over time.

So while we had a lot of challenges last year with existing clients, Actually selling prospects, which are business developers to, was actually they were very strong. And so because the of our sales productivity strength there, that's the one place that we have added to our know, our Salesforce going into 2026. Which we think positions us well for both '26 and '27. This takes time for people to get the full productivity. There's a lot of other changes, but it gives you a flavor for even I didn't talk about a lot. We're continuing to innovate, and if anything, pick up the pace of innovation, in sales and in services as well.

Scott Wurtzel: Great. That's helpful. Thank you.

Operator: Thank you. Our next question comes from Jeffrey Silber with BMO Capital Markets. Your line is open.

Jeffrey Silber: Thanks so much. You guys always give us a lot of data, specifically on the retention side. And I know there's a lot of noise in that number because of federal government, etcetera. But I'm just curious, are you seeing clients keeping their relationships with you but maybe cutting back on seats or taking a lower level of service? And if that's happening, how do you counter that?

Gene Hall: Yeah. So, well, let's let me get started on it. So, basically, what you said is exactly right, which is we see very few clients actually out, like, casting us. Of course, we lose clients because there's mergers and acquisitions. Some small companies go out of business, things like that. We make mistakes sometimes. But, you know, if we look at, 24 compared to 25, most of the retention issue we've had was a client who has 10 seats saying, well, because of budget problems, you know, I'm gonna go down to nine seats. And that's kind of been the fee retention program. Issue that we faced.

So it hasn't been clients saying, well, I don't get by at a Gartner. It's kind of it's been more get a lot of value at Gartner. It's tough times. In fact, what often happens is clients have turnover. So somebody will leave a job. Let's say they retire. They may not fill that position immediately, That's the most vulnerable seats. If someone leaves the job, changes companies, or retires, whatever, happens to their budget, they basically say, you have got 10 seats. One of them sorry. There's no one there right now because they left the company. So why don't we cut that seat out, and then we'll revisit it when we get position built.

That's the most that's the most common thing we face in today's And, Jeff, just on the, you know, on the metric side of it, you can see if you look at the total global sales, client retention rates are up about a 100 bps year over year. And so, you know, not only are we holding on to that, we're we're holding on to more of them. On a year-over-year basis. The challenge is all the things that Gene highlighted. And, again, we believe all the things we're doing around, you know, the insights transformation are the things that are actually going to you know, help change the outcome there from a retention perspective?

Again, think about the investment in BDs that Gene just talked about, all the things doing in transformation business, continued, you know, process automation and process improvement. All those things are you know, what we believe will sort of bridge the gap and allow that contract value growth rate to accelerate in 2026.

Operator: Thank you. Our next question comes from Ashish Sabadra with RBC Capital Markets.

Ashish Sabadra: Thanks for taking my question. You mentioned the tougher selling environment. I was just wondering, based on what you've seen in Jan, any thoughts or based on the feedback that you might have received from the salespeople how do you think about the sales environment in '26? What in particular, if you can talk about the demand environment and the budgets, how are those shaping up? And any color on those external market forces by industry? Are there any particular industry like the tariff impact industry? If you have seen any lessening of pressure on that front?

Gene Hall: So we're certainly assuming that this year, 2026, that the selling environment is going to be no better than it's been in 2025. That there's still going to be lots of challenges. And so that's kind of our assumption. What I will say is that there are areas that are worse. So for example, when you're we sell to every industry, including, for example, oil producers. And if you look from oil prices going down, they have a tougher environment than they did even last year with lower oil prices. On the other hand, a lot of the tariffs have stabilized. And so some of the companies that had turns over tariffs have kind of hey.

With 15% tariffs, if that's what it stays at, we can live with that. And so I think it's a mixed bag. You know, we serve every part of the economy. And so there's some parts that are a little bit better. And there are other parts, I think, that are worse. But again, we're assuming because it's not gonna get better at all.

Ashish Sabadra: Thanks.

Operator: Our next question comes from George Tong with Goldman Sachs. Your line is open.

George Tong: This is Sammy on for George. Your margin guidance suggests a step down from 2025. Is this the new baseline for the business since the incremental investments seem more structural? Or do you view the decline as temporary? And margins would return to that, 25% level fairly quickly?

Craig Safian: Hey. Good morning. So, you know, as we built the plan for 2026, I'd I'd say a couple things. So one is we've been managing our run rate 2026 over the course of 2025. And we talked about this a little bit in our prepared remarks basically ensuring you know, our cost base is aligned with CV growth and also with the corresponding revenue growth. And so some of the actions we took in 2025 we got benefit in '25. Those were really for 2026. So that would be the first point I make. Second point I make is you know, we've got our assumed operating expense plan, if you will, for 2026.

Growing, yeah, at about 5% year over year. And there's a little bit of FX in there. So on an FX neutral basis, growing around 4% year over year. That's basically, you know, our merit increase. Plus some selected investments which we talked about in our prepared remarks. And then the third thing I'd say is, yeah, we do believe that 23 and a half is the new baseline, if you will. And we should be able to expand our margins going forward. Now, again, you know, with faster CV growth, you know, as Gene highlighted, that certainly helps from a revenue growth perspective. EBITDA flow through free cash flow perspective, etcetera, and ultimately, margin perspective.

But, you know, again, we've baked in accelerating CV growth into our plan for 2026. As you know, the revenue does lag that. And so that's also part of the margin bridge story from '25 to '26.

George Tong: Got it. Thank you.

Operator: Thank you. I'm showing no further questions at this time. Like to turn the call back over to Gene Hall for closing remarks.

Gene Hall: So here's what I'd like you to take away from today's call. Q4 financial results were ahead of expectation. Margins and free cash flow were strong. We reduced our shares outstanding by 8% in the year. In 2025, we began transforming business and technology insights on board of engines. Impact, volume, timeliness, and user experience. These transformations will allow us to thrive in a world with greater change and uncertainty. We expect to see the impact over the next few years, and we'll continue to keep you updated on our progress. Looking ahead, we're well-positioned to accelerate CV growth throughout 2026.

We'll continue to create value for our shareholders by providing timely objective insight guidance and tools for our clients, responsibly investing for future growth, generating free cash flow well in excess of net income, and returning capital to our shareholders through our repurchase program. Thanks for joining us today, and we look forward to updating you again next quarter.

Operator: Thank you for your participation. You may now disconnect.

Operator: Good day.