Gartner's EPS Beat Masked Revenue Shortfall; Investigation Probes Presentation of Financial Metrics

Rhea-AI Summary

Argus Feb 11 session

+1.03% close to close Open Argus

Details

News Market Reaction – IT

In the Feb 11 session, IT gained 1.03%, reflecting a mild positive market reaction.

Data tracked by StockTitan Argus on the day of publication.

Market Context

This announcement highlights an investigation into how Gartner emphasized its EPS beat versus revenu...

Analysis

This announcement highlights an investigation into how Gartner emphasized its EPS beat versus revenue shortfalls and a weaker 2026 outlook. It focuses on compliance with SEC Regulation G and Regulation S‑K for non‑GAAP metrics, as well as prior guidance of at least $12.65 EPS based on 78 million shares and >$1B in buybacks. Monitoring future disclosures and any regulatory developments will be important.

Key Figures

2025 adjusted EPS guidance: $12.65+ Share-count assumption: 78 million shares Q3 2025 buybacks: >$1 billion +3 more

2025 adjusted EPS guidance

$12.65+

Management prior guidance for full-year 2025 adjusted EPS

Share-count assumption

78 million shares

Base share count used in 2025 EPS guidance

Q3 2025 buybacks

>$1 billion

Stock repurchased during Q3 2025

Share count reduction

6%

Year-over-year reduction in shares from repurchases

Post-earnings share drop

>20%

Intraday decline after Feb. 3, 2026 earnings release

New 52-week low

Below $160

Level reached after earnings before this investigation release

Historical Context

5 past events · Latest: Feb 03

5 events

1. Feb 03

   Q4 2025 earnings

   24h Move

   -20.9%

   Earnings showed profit and cash flow declines despite modest revenue growth and buybacks.

2. Jan 29

   Board appointments

   24h Move

   -1.4%

   Two new independent directors added, enhancing AI and investment expertise on board.

3. Jan 29

   Business divestiture deal

   24h Move

   -5.9%

   Agreement to sell Capterra, Software Advice, and GetApp to G2 to reshape portfolio.

4. Jan 20

   Earnings date notice

   24h Move

   -3.8%

   Announcement of timing and webcast details for upcoming Q4 2025 earnings release.

5. Dec 07

   Conference announcement

   24h Move

   -1.1%

   Launch of Gartner Finance Symposium/Xpo 2026 focused on AI and finance transformation.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Key Terms

sec regulation g, regulation s-k, non-gaap financial measures, gaap

4 terms

sec regulation g regulatory

"SEC Regulation G and Item 10(e) of Regulation S-K establish disclosure requirements"

SEC Regulation G requires public companies to disclose and clearly explain any financial measures they present that fall outside standard accounting rules (GAAP). When a company shows a non‑GAAP number, the rule obliges it to provide the most directly comparable GAAP figure and a detailed reconciliation so investors can see exactly how the number was derived. This matters because it prevents companies from presenting modified figures that could paint a misleading picture, letting investors compare results the same way you’d compare a recipe’s original ingredient list to a customized version.

regulation s-k regulatory

"SEC Regulation G and Item 10(e) of Regulation S-K establish disclosure requirements"

A set of U.S. Securities and Exchange Commission rules that tell public companies which narrative and qualitative details must be disclosed in filings, such as risk factors, management discussion, executive pay, legal proceedings and business description. Think of it as a standardized checklist or blueprint that ensures investors get the same types of background information from every company so they can compare risks, management quality and strategy before making investment decisions.

non-gaap financial measures financial

"requirements for companies presenting non-GAAP financial measures."

Non-GAAP financial measures are numbers companies use to show their financial performance that exclude certain expenses or income. They help investors see how the company might perform without one-time costs or other unusual items, giving a different perspective from official reports. However, since they can be adjusted, they don’t always tell the full story and should be looked at alongside standard financial figures.

gaap financial

"reconciled to the most directly comparable GAAP measure and that GAAP results"

GAAP, or Generally Accepted Accounting Principles, are a set of standardized rules and guidelines that companies follow when preparing their financial statements. They ensure consistency, transparency, and comparability across different companies, making it easier for investors to understand and compare financial information accurately. This helps investors make informed decisions based on trustworthy and uniform financial reports.

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NYSE: IT

NEW YORK, Feb. 11, 2026 /PRNewswire/ -- Levi & Korsinsky, LLP is investigating Gartner, Inc. (NYSE: IT) regarding the presentation of financial metrics in the company's earnings communications and SEC filings. Shareholders who suffered losses may obtain information about this investigation by clicking here.

SEC Regulation G and Item 10(e) of Regulation S-K establish disclosure requirements for companies presenting non-GAAP financial measures. These rules require that adjusted metrics be reconciled to the most directly comparable GAAP measure and that GAAP results receive equal or greater prominence. The regulations aim to prevent companies from using adjusted presentations to obscure underlying performance trends.

Gartner's February 3, 2026 fourth quarter earnings release presented a narrative that emphasized the company's earnings-per-share beat relative to analyst estimates. However, the same release disclosed that revenue fell short of consensus expectations and that the company was issuing a full-year 2026 outlook that demonstrated a year-over-year decline. The investigation will examine the relative prominence given to each metric in the company's communications.

The company had previously guided investors to expect adjusted EPS of at least $12.65 for 2025, with CFO Craig Safian noting that the guidance was based on 78 million shares and assumed "repurchases to offset dilution." Gartner repurchased more than $1 billion of stock during Q3 2025, reducing share count by 6% year-over-year. The investigation will examine whether the EPS guidance and share-count assumptions were realistic given management's knowledge of revenue trends.

Following the earnings release, Gartner shares declined more than 20% in midday trading, reaching a new 52-week low below $160. Trading volume increased significantly above normal levels.

Gartner investors who wish to learn more about their rights may contact Levi & Korsinsky for a free consultation.

Levi & Korsinsky, LLP is a nationally recognized firm with offices in New York, California, Connecticut, and Washington, D.C. that prosecutes securities, consumer, and shareholder class actions on behalf of investors (www.zlk.com).

CONTACT:

Joseph E. Levi, Esq.
Levi & Korsinsky, LLP
33 Whitehall Street, 27th Floor
New York, NY 10004
Tel: (212) 363-7500
Fax: (212) 363-7171
Email: jlevi@levikorsinsky.com
www.zlk.com

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SOURCE Levi & Korsinsky, LLP