CAMBRIDGE, Mass., February 8, 2024 — Forrester Research, Inc. (Nasdaq: FORR) today announced fourth-quarter and full-year financial results for 2023, with contract value (CV) down by 4%, at $332.1 million, compared with the prior year.

Commenting on the results, George F. Colony, Forrester’s CEO and chairman, stated, “2023 was a challenging year, with revenue down 11% and CV down by 4%. However, we made steady progress in 2023 on multiple fronts, including improving the Forrester Decisions platform, upskilling the sales organization, and readying our genAI tool, Izola, for general release. Furthermore, we achieved our goal of migrating two-thirds of our contract value into our new research platform, Forrester Decisions.

“We see 2024 as the final transition year in the Forrester Decisions migration, and this is reflected in our 2024 guidance. We expect pressures throughout the year on CV, key retention metrics, and revenue. However, we have built the product, go-to-market, and organizational foundations to enable the company to return to CV growth in 2025.”

Fourth-Quarter Consolidated Results

Total revenues for the fourth quarter of 2023 were $118.1 million, compared with $136.9 million for the comparable quarter in 2022.

On a GAAP basis, net loss was $0.7 million, or $0.03 per diluted share, for the fourth quarter of 2023, compared with a net loss of $1.6 million, or $0.09 per diluted share, for the same period in 2022.

On an adjusted basis, net income was $4.8 million, or $0.25 per diluted share, for the fourth quarter of 2023, reflecting an adjusted effective tax rate of 29%. Adjusted net income excludes stock-based compensation of $4.3 million, amortization of acquisition-related intangible assets of $2.8 million, restructuring costs of $1.1 million, and investment gains of $0.2 million. This compares with adjusted net income of $8.5 million, or $0.45 per diluted share, for the same period in 2022, which reflects an adjusted tax rate of 30%. Adjusted net income for the fourth quarter of 2022 excludes stock-based compensation of $3.5 million, amortization of acquisition-related intangible assets of $3.1 million, restructuring costs of $9.3 million, and investment losses of $0.1 million.

Year Ended December 31, 2023, Financial Performance

Total revenues were $480.8 million, compared with $537.8 million for the same period in 2022.

On a GAAP basis, net income was $3.1 million, or $0.16 per diluted share, for 2023, compared with net income of $21.8 million, or $1.14 per diluted share, for 2022.

On an adjusted basis, net income was $36.6 million, or $1.90 per diluted share, for 2023, which reflects an adjusted effective tax rate of 29%. Adjusted net income excludes stock-based compensation of $15.5 million, amortization of acquisition-related intangible assets of $12.0 million, restructuring costs of $13.3 million, a legal settlement of $4.8 million, and gains on investments of $0.2 million. This compares with adjusted net income of $47.2 million, or $2.46 per diluted share, for 2022, which reflects an adjusted tax rate of 30%. Adjusted net income for 2022 excludes stock-based compensation of $14.5 million, amortization of acquisition-related intangible assets of $13.2 million, restructuring costs of $9.3 million, and investment gains of $0.3 million.

Additional details regarding key metrics can be found in the investor presentation on the investor relations section of the Company’s website.

A reconciliation of GAAP results to adjusted results may be found in the attached financial tables.

2024 Guidance

Forrester is providing full-year 2024 financial guidance as follows:

Full-Year 2024 (GAAP):

  • Total revenues of approximately $430.0 million to $450.0 million, or a decline of 6% to 11% versus the prior year
  • Operating margin of approximately 2.4% to 3.4%
  • Interest expense of approximately $3.0 million
  • An effective tax rate of 35%
  • Diluted earnings per share of approximately $0.33 to $0.53

Full-Year 2024 (Adjusted):

Adjusted financial guidance for full-year 2024 excludes stock-based compensation expense of $13.8 million to $14.8 million, amortization of acquisition-related intangible assets of approximately $10.0 million, restructuring costs of $6.6 million to $7.0 million, and any investment gains or losses.

  • Adjusted operating margin of approximately 9.5% to 10.5%
  • Adjusted effective tax rate of 29%
  • Adjusted diluted earnings per share of approximately $1.50 to $1.70

About Forrester

Forrester (Nasdaq: FORR) is one of the most influential research and advisory firms in the world. We help leaders across technology, customer experience, digital, marketing, sales, and product functions use customer obsession to accelerate growth. Through Forrester’s proprietary research, consulting, and events, leaders from around the globe are empowered to be bold at work — to navigate change and put their customers at the center of their leadership, strategy, and operations. Our unique insights are grounded in annual surveys of more than 700,000 consumers, business leaders, and technology leaders worldwide; rigorous and objective research methodologies, including Forrester Wave™ evaluations; more than 100 million real-time feedback votes; and the shared wisdom of our clients. To learn more, visit Forrester.com.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, Forrester’s financial guidance for the full-year 2024 and statements about the performance of Forrester Decisions, Forrester’s sales force, and Forrester’s future financial performance and financial condition. These statements are based on Forrester’s current plans and expectations and involve risks and uncertainties that could cause actual future activities and results of operations to be materially different from those set forth in the forward-looking statements. Important factors that could cause actual future activities and results to differ include, among others, Forrester’s ability to retain and enrich memberships for its research products and services, including the migration of its existing clients into its Forrester Decisions portfolio of services; Forrester’s ability to fulfill existing or generate new consulting engagements and advisory services; technology spending; the risks and challenges inherent in international business activities; the impact of health epidemics, including COVID-19, on Forrester’s business; Forrester’s ability to offer new products and services; Forrester’s dependence on key personnel; Forrester’s ability to attract and retain professional staff; Forrester’s ability to respond to business and economic conditions and market trends; the impact of Forrester’s outstanding debt obligations; competition and industry consolidation; possible variations in Forrester’s quarterly operating results; concentration of ownership of Forrester; the possibility of network disruptions and security breaches; any failure to enforce and protect Forrester’s intellectual property rights; compliance with privacy laws; taxation risks; any weakness in Forrester’s system of internal controls; and the amount and timing of the repurchase of Forrester stock. Forrester undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise. For further information, please refer to Forrester’s reports and filings with the Securities and Exchange Commission.

The consolidated statements of operations and the table of key financial data are attached.

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Forrester Q4 Earnings Release Tables.