Why Research & Consulting Firm Gartner's Stock Is Jumping Today

Gartner, Inc. IT shares are trading higher after the company reported third-quarter FY23 revenue growth of 5.8% year-on-year to $1.409 billion (+4.9% FX neutral), beating the consensus of $1.390 billion.

Revenues from Research rose 6.2% Y/Y to $1.22 billion, and Conferences were $57 million, down 25.7% Y/Y. Consulting revenue grew 24.1% Y/Y to $133 million.

Global Technology Sales Contract Value rose 6.5% Y/Y FX neutral to $3.6 billion. Global Business Sales Contract Value increased 14% Y/Y FX neutral to $1 billion.

Adjusted EPS of $2.56 beat the consensus of $1.96.

Gartner generated $331 million in operating cash flow, +5.1% Y/Y. The company generated free cash flow of $302 million, +6.9% Y/Y.

CEO Gene Hall commented, "Gartner delivered another strong quarter with high single-digit growth in contract value and better than expected performance in revenue, profitability, and free cash flow."

Outlook Raised: Gartner raised FY23 revenue guidance to At Least $5.89 billion versus the $5.88 billion consensus (prior view: At Least $5.85 billion).

The company expects FY23 adjusted EPS of At Least $10.90 versus the $10.32 estimate (prior view: At Least $10.00).

Price Action: IT shares traded higher by 15.22% at $388.98 on the last check Friday.