Gartner, Inc. (NYSE: IT) is the world’s leading researchdelivers actionable, objective insight to executives and advisory company and a member of the S&P 500. We equip business leaders with indispensable insights, advicetheir teams. Our expert guidance and tools to achieve their mission-critical priorities todayenable faster, smarter decisions and build the successful organizations of tomorrow. We believe our unmatched combination of expert-led, practitioner-sourced and data-driven research steers clients toward the right decisionsstronger performance on the issues that matter most. an organization’s mission critical priorities.

We are a trusted advisor and an objective resource for more than 14,00015,000 enterprises in more thanapproximately 100 countries —and territories— across all major functions, in every industry and enterprise size.

Gartner delivers its products and services globally through three business segments – Research, Conferences and Consulting, as described below.

The fiscal year of Gartner is the twelve-month period from January 1 through December 31. All references to 2021, 2020 2019 and 20182019 herein refer to the fiscal year unless otherwise indicated. When used in this Annual Report on Form 10-K, the terms “Gartner,” the “Company,” “we,” “us” or “our” refer to Gartner, Inc. and its consolidated subsidiaries.

Enterprise leaders face enormous pressure to stay ahead and grow profitably amidst constant changes. Whether it is a digital transformation, a global health crisis, or large-scale regulatory changes, or other unique challenges, business leaders today are facing significant disruptive changes. We believe that enterprises cannot be operationally effective unless they incorporate the right strategy, management and technology decisions into every part of their business. This requirement affects all business levels, functions and roles. Chief financial officers, heads of human resources, chief marketing officers, chief information officers, heads of supply chainExecutives and other executives and leaderstheir teams turn to Gartner for decision-making guidance and execution supportguidance to achieve their mission-criticalmission critical priorities.

We believe our unmatched combination of expert-led, practitioner-sourced and data-driven research steers clients toward the right decisions and actions on the issues that matter most. Organizations are overrun with data and information. Gartner helps eliminate this information chaos and provides clarity with actionable, objective insight. We employ a diversified business model that utilizes and leverages the breadth and depth of our differentiated intellectual capital. The foundation of our business model is our ability to create and distribute our proprietary research content as broadly as possible via published reports, interactive tools, facilitated peer networking, briefings and briefings;direct communications with executives and their teams; our conferences, including the Gartner Symposium/Xpo series; and consulting and advisory services.

Our diversified business model provides multiple entry points and sources of value for our clients that lead to increased client spending on our research and advisory services, conferences and consulting services. A critical part of our long-term strategy is to increase business volume and penetration with our most valuable clients, identifying relationships with the greatest sales potential and expanding those relationships by offering strategically relevant research and advice.insight. We also seek to extend the Gartner brand name to develop new client relationships, augment our sales capacity and expand into new markets around the world. These initiatives have created additional revenue streams through more effective packaging, campaigning and cross-selling of our products and services. In addition, we seek to increase our revenue and operating cash flow through more effective pricing of our products and services.

Our principal products and services are delivered through our three business segments, as described below.

We believe that the principal factors that differentiate us from our competitors are as follows:

Notwithstanding these differentiating factors, we face competition from a significant number of independent providers of information products and services. We compete indirectly with consulting firms and other data and information providers, including electronic and print media companies. These indirect competitors could choose to compete directly with us in the future. In addition, we face competition from free sources of information that are available to our clients through the internet. Limited barriers to entry exist in the markets in which we do business. As a result, new competitors may emerge and existing competitors may start to provide additional or complementary services. While we believe the breadth and depth of our research positions us well versus our competition, increased competition could result in loss of market share, diminished value in our products and services, reduced pricing, and increased sales and marketing expenditures.

Our success has resulted in part from proprietary methodologies, software, reusable knowledge capital and other intellectual property rights. We rely on a combination of patent, copyright, trademark, trade secret, confidentiality, non-compete and other contractual provisions to protect our intellectual property rights. We have policies related to confidentiality, ownership, and the use and protection of Gartner’s intellectual property. We also enter into agreements with our employees and third parties as appropriate that protect our intellectual property, and we enforce these agreements if necessary. We recognize the value of our intellectual property in the marketplace and vigorously identify, create and protect it. Additionally, we actively monitor and enforce contract compliance by our end users.

We believe our people are our most valuable asset, enabling our long track record of global growth. From attracting diverse talent through our recruitment process to cultivating that talent with learning and development opportunities and rewards for strong performers to supporting overall wellness with meaningful benefits and engagement, we strive to put our people first. At December 31, 2020,2021, we had approximately 15,60016,600 employees in over 90 offices globally, and the overwhelming majority of our employees were full time.

We foster an environment of professional development to help our employees reach their full potential.potential through a culture of continuous improvement. This includes embracing diversity and actively removing barriers to support inclusion, engagement and growth at Gartner. Our Executive Diversity, Equity and Inclusion (DEI)(“DEI”) Executive Council, composed of our CEO, Chief Human Resources Officer, CFO, General Counsel, head of Diversity, Equity and Inclusion, head of DEI Research within our Gartner HR research practice, and other selected

We also focus on the role of unconscious bias and endeavor to build tools that help make various business processes more inclusive and accommodate a more diverse perspective. We emphasize the importance of inclusion to leaders and managers and how to fosterthe value of fostering a sense of belonging within their teams. In 2020, we introduced a new leadership forum called the Leadership Exchange (LeadEx) for all Vice Presidents and above. The forum provides sessions for leadersWe also continue to share experiences, ask questions and gain perspective on effectively leading people within the context of current events and the rapidly changing environment.invest in learning opportunities to develop DEI at Gartner. For example, our popular Embracing Diversity & Being Inclusive module has enrolled more than 5,600 associates since its inception.

The Company supports a number of employee-driven Employee Resource Groups (ERGs)(“ERGs”) that bring employees together to foster a diverse, inclusive and supportive workplace. Gartner currently has six formal ERGs supporting underrepresented racial, ethnic and multicultural backgrounds, women, the LGBTQ+ community, veterans and veterans.employees with disabilities. Participation in ERGs is voluntary and open to all employees. In 2020, our ERGs had more than 4,900 associate memberships, and the groups delivered 100+ programs.2021, over 4,300 Gartner associates were members of at least one ERG.

We seek to invest in meaningful, innovative and inclusive compensation and benefit programs that support physical, financial and emotional well-being of our employees. In addition to salaries, these programs (which vary by country/region) include annual bonuses, stock awards, an employee stock purchase plan, 401(k) matching, healthcare and insurance benefits, tax savings programs, such as health and dependent care flexible spending accounts, health savings account and pretax commuter benefits, generous paid time off, paid parental leave, life and disability insurance, business travel accident insurance, charity matching, employee assistance programs, tuition assistance and on-site services, such as health centers and fitness centers, among others. We believe that our equity grants facilitate retention as well as encourage performance of key personnel.

In response to the COVID-19 pandemic, we implemented significant changes to protect the health and safety of our employees, clients and the communities in which we operate. This includesincluded the temporary closure of our offices (including our corporate headquarters) in the United States, United Kingdom, India, and several other impacted locations around the world, as well as the cancellation of certain in-person conferences. In general, even whereWe have now reopened a majority of our offices have reopened,(including our employees havecorporate headquarters) and are planning to reopen the option to work remotely and we have implemented additionalremaining offices in early 2022, with safety guidelines to protect them.employee health. In 2021, we announced a hybrid virtual-first working arrangement, which provides additional flexibility to employees, enabling most of them to continue working remotely a substantial portion of the time. We also provide a number of free mental and behavioral health resources, including access to the Employee Assistance Program for employees and their dependents.

Gartner aims to foster a culture of lifelong learning, getting feedback and evolving. In addition to helping employees unlock their full potential through mechanisms like continuous feedback and performance appraisals, we have dedicated programs designed to develop effective leaders, including our Gartner Manager Program and Tenured Manager Program.leaders. We also offer rotational programs and an online learning experience platform for employees called GartnerYou. In 2020,2021, GartnerYou offered close to 35,00045,000 learning resources, with more than 343,000321,000 completions globally. Since our Sales and Research & Advisory teams make up more thanof approximately 50% of total employees worldwide, we also have formal, dedicated programs to help train and onboard new hires as well as more experienced managers and leaders within Sales and Research & Advisory. In 2020,2021, Gartner transformed how we had eight dedicated programs foronboard new sales hires across ourso they more quickly develop the core competencies tied to sales teams, which were attended by approximately 900 employees.success. Rooted in learning and development best practices, the reimagined program operates in a scalable model that provides new sales hires in their first year with access to as many as 500 well-paced, just-in-time learning assets. More than 1,200 sales associates went through this program in 2021. Through these programs, we believe our teams develop role-specific knowledge and skills, increase productivity and improve performance.

Our U.S. government contracts are subject to the approval of appropriations by the U.S. Congress to fund the agencies contracting for our products and services. Additionally, our contracts at the state and local levels, as well as foreign government contracts, are subject to various governmental authorizations and funding approvals and mechanisms. Certain of these contracts may be terminated at any time by the government entity without cause or penalty.

The COVID-19 pandemic has subjected our operations and financial performance to a number of risks that may have (or may continue to have) a material adverse impact on our operations and financial condition, including, but not limited to those discussed below:

Moreover, COVID-19 has adversely impacted, and may continue to adversely impact our subscription-based business model (which accounts for a significant portion of our revenue) by causing clients to decrease new and renewals of subscription-based services and to request to cancel or renegotiate current subscription-based services.The effect of COVID-19 on our subscription-based model may not be fully reflected in our results of operations until future periods.

Further, the duration and extent of the impact from the COVID-19 pandemic and its impact on our operations and financial performance depend on future developments that cannot currently be accurately predicted, such as:

The occurrence or continuation of any of the foregoing could have a material adverse effect on our operations or financial performance.

The impact of COVID-19, and the volatile regional and global economic conditions stemming from the pandemic, may also precipitate or exacerbate other risks discussed in Item 1A. Risk Factors in this Annual Report on Form 10-K, any of which could have a material effect on us. This situation is changing rapidly and additional effects may arise that we are not presently aware of or that we currently do not consider to present significant risks to our operations. If we are not able to respond to and manage the impact of such events effectively, our business and financial condition will be negatively impacted.

our competitors operate. We will need to continue to respond to these changes by enhancing our product and service offerings to maintain our competitive position. However, we may not be successful in responding to these forces and enhancing our products on a timely basis, and any enhancements we develop may not adequately address the changing needs of our clients. Our future success will depend upon our ability to develop and introduce in a timely manner new or enhanced existing offerings that address the changing needs of this constantly evolving marketplace. Failure to develop products that meet the needs of our clients in a timely manner could have a material adverse effect on our business, results of operations, and financial position.

Our research subscription contracts are typically for twelve months or longer. Our ability to maintain contract renewals is subject to numerous factors, including the following:

Additionally, as we continue to adjust our products and service offerings to meet our clients’ continuing needs, we may shift the type and pricing of our products which may impact client renewal rates. While our Research client retention rate was 83%86% and 82%83% at December 31, 20202021 and 2019,2020, respectively, there can be no guarantee that we will continue to maintain this rate of client renewals.

We expect our Conferences revenues will continue to be negatively impacted until in-person conferences can be held. Moreover, our clients that typically attend these conferences may have pandemic-related travel restrictions in place that could affect attendance once these conferences resume. At this time, we also cannot predict the extent to which local governments may restrict in-person gatherings and what additional measures will be required to hold in-person conferences safely, such as providing masks, social distancing and increased sanitation. These safety requirements would likely cause us to incur additional costs and may limit the number of participants at our in-person conferences. In addition, perceived or actual spread of coronavirus at one of our conferences could cause reputational damage. The safety of our associates and clients remainremains our top priority so future in-person conferences will be held only if we determine the relevant impacts of COVID-19 have sufficiently receded in the jurisdictions where our conferences are to be held.

The market for desirable dates and locations for our activities has historically been highly competitive. Once we decide to resume in-person conferences, if we cannot secure desirable dates and suitable venues for our conferences the profitability for these conferences will suffer, and our financial condition and results of operations may be adversely affected. In addition, because our conferences are scheduled in advance and held at specific locations, the success of these activities can be affected by circumstances outside of our control in addition to the COVID-19 pandemic, such as the occurrence of or concerns related to labor strikes, transportation shutdowns and travel restrictions, economic slowdowns, reductions in government spending, geopolitical crises, terrorist attacks, war, weather, natural disasters, communicable diseases, and other occurrences impacting the global, regional, or national economies, the occurrence of any of which could negatively impact the success of the conference or meeting. We also face the challenge of procuring venues that are sizeable enough at a reasonable cost to accommodate some of our major activities.

A material decline in our ability to replace consulting engagements will have an adverse impact on our revenues and our financial condition.

An inability to retain key personnel or to hire and train additional qualified personnel could materially adversely affect the quality of our products and services, as well as our future business and operating results.results or stock price. In addition, effective succession planning is important to our long-term success, and failure to ensure effective transfer of knowledge and smooth transitions involving key employees could hinder our strategic planning and execution.

Our employees are subject to restrictive covenant agreements (which include restrictions on employees’ ability to compete and solicit customers and employees) and assignment of invention agreements, to the extent permitted under applicable law. When the period expires relating to their particular restrictions, former employees may compete against us. If a former employee violates the provisions of the restrictive covenant agreement, we seek to enforce the restrictions but there is no assurance that we will be successful in our efforts.

Like many multinational corporations, we, and some third parties upon which we rely, have experienced cyber attacks on our computer systems and networks in the past and may experience them in the future, likely with more frequency and sophistication, and involving a broader range of devices and modes of attack, all of which will increase the difficulty of detecting and successfully defending against them. To date, none have resulted in any material adverse impact to our business, operations, products, services or customers. We have implemented various security controls to both meet our security compliance obligations, while also defending against constantly evolving security threats. Our security controls help to secure our information systems, including our computer systems, intranet, proprietary websites, email and other telecommunications and data networks, and we scrutinize the security of outsourced website and service providers prior to retaining their services. However, the security measures implemented by us or by our outside service providers may not be effective and our systems (and those of our outside service providers) are vulnerable to theft, loss, damage and interruption from a number of potential sources and events, including unauthorized access or security breaches, cyber attacks, computer viruses, power loss, or other disruptive events. As a result of the COVID-19 pandemic, and shelter-in-place orders, most of our employees in affected areas are working remotely, which magnifies the

importance of the integrity of our remote access security measures. Additionally, the security compliance landscape continues to evolve, requiring us to stay apprised of changes in cybersecurity laws, regulations, and security requirements required by our clients, such as the European Union General Data Protection Regulation (GDPR), the California Consumer Privacy Act (CCPA), the Brazilian General Data Protection Law (LGPD), the Chinese Cybersecurity, and draft Data Security and Personal Information Protection laws (and other new and proposed data protection laws), International Organization for Standardization (ISO), and National Institute of Standards and Technology (NIST). Recent well-publicized security breaches at other companies have led to enhanced government and regulatory scrutiny of the measures taken by companies to protect against cyber attacks, and may in the future result in heightened cybersecurity requirements, including additional regulatory expectations for oversight of vendors and service providers.

A cyber attack, widespread internet failure or internet access limitations, or disruption of our critical information technology systems through denial of service, viruses, or other events could cause delays in initiating or completing sales, impede delivery of our products and services to our clients, disrupt other critical client-facing or business processes or dislocate our critical internal functions. Additionally, any material breaches of cybersecurity or other technology-related catastrophe, or media reports of perceived security vulnerabilities to our systems or those of our third parties, even if no breach has been attempted or occurred, could cause us to experience reputational harm, loss of customers and revenue, fines, regulatory actions and scrutiny, sanctions or other statutory penalties, litigation, liability for failure to safeguard our customers’ information, or financial losses that are either not insured against or not fully covered through any insurance maintained by us.

Any of the foregoing may have a material adverse effect on our business, operating results and financial condition.

To accommodate our growth going forward, we have moved to a global hoteling option to better manage our footprint and operating expenses, and will secure new space when the opportunities and need arise. If the new spaces are not completed on schedule, or if the landlord defaults on its commitments and obligations pursuant to the new leases, we may incur additional expenses. In addition, unanticipated difficulties in initiating operations in a new space, including construction delays, IT system interruptions, or other infrastructure support problems, could result in a delay in moving into the new space, resulting in a loss of employee and operational productivity and a loss of revenue and/or additional expenses, which could also have an adverse, material impact on our operating results.

The debt service requirements of these borrowings could impair our future financial condition and operating results. In addition, the affirmative, negative and financial covenants of the 2020 Credit Agreement, as well as the covenants related to the Senior Notes, could limit our future financial flexibility. A failure to comply with these covenants could result in acceleration of all amounts outstanding, which could materially impact our financial condition unless accommodations could be negotiated with our lenders and noteholders. No assurance can be given that we would be successful in doing so, or that any accommodations that we were able to negotiate would be on terms as favorable as those currently in place. The outstanding debt may limit the amount of cash or additional credit available to us, which could restrain our ability to expand or enhance products and services, respond to competitive pressures or pursue future business opportunities requiring substantial investments of additional capital.

In addition, variable-rate borrowings under our 2020 Credit Agreement typically use LIBOR as a benchmark based on market participant judgments for establishing the rate of interest. LIBOR is the subject of recent national and international regulatory scrutiny, which mayis expected to result in changes that cause LIBOR to disappear entirely after June 2023 for rates applicable to the 2020 Credit Agreement and our existing derivatives contracts, and as of December 2021 for any new debt and derivatives contracts that we may enter into. The changes may also cause LIBOR to perform differently than in the past. The Alternative Reference Rates Committee (ARRC), which was convened by the Federal Reserve Board and the New York Fed, has identified the Secured Oversight Financing Rate (SOFR) as the recommended risk-free alternative rate for USD LIBOR. The future consequences of these LIBOR developments on our variable-rate borrowings, including the possible transition to rates based on observable transactions, such as the Secured Overnight Financing Rate (SOFR), cannot be predicted at this time, but could include an increase in the cost of our variable-rate indebtedness and volatility in our earnings.

indebtedness would result in increased debt service obligations and could require us to agree to operating and financial covenants that would further restrict our operations.

Additionally, tariffs, trade barriers and restrictions, and other acts by governments to protect domestic markets or to retaliate against the trade tariffs and restrictions of other nations could negatively affect our business operations. In addition, the withdrawal of nations from existing common markets or trading blocs, such as the exit of the United Kingdom (UK) from the European Union (the EU), commonly referred to as Brexit, could be disruptive and negatively impact our business and the business of our clients. We continue to monitor Brexit and its potential impacts on our results of operations and financial condition. In connection with Brexit, onin December, 24, 2020, the EU and the United Kingdom reached an agreement on a new trade arrangement that became effective on January 1, 2021. OnceDepending on the new rules are formalized,application of the terms of the trade and cooperation agreement, there could be near or long-term negative impacts on our UK business. If this agreementbusiness due to regulatory costs and the new rules, once formalized, lead to legal uncertaintychallenges for us and potentially divergent national laws and regulations in the United Kingdom and EU, then we, as well as our clients who have significant operations in the United Kingdom, may incur additional costs and expenses as we adapt to the new trade agreements. For example, we may face additional administrative procedures when purchasing tangible goods and equipment from the EU. Additionally, volatility in foreign currencies and other markets may also arise as the UK and EU work though the new trade arrangements.Kingdom. The impact of any of these effects of Brexit, among others, could materially harm our business and financial results.

achieve acceptable levels of these measurements or improve them will negatively impact our financial condition, results of operations, and cash flows.

There can be no assurance that we will be able to successfully compete against current and future competitors and our failure to do so will result in loss of market share, diminished value in our products and services, reduced pricing and increased marketing expenditures. Furthermore, we will not be successful if we cannot compete effectively on quality of research and analysis,

and LGPD compliance programs. In the meantime, Gartner will continue to maintain and rely upon our comprehensive global data protection compliance program, which includes administrative, technical, and physical controls to safeguard our associates’ and clients’ personal data. The interpretation and application of these laws in the United States, the EU and elsewhere are often uncertain, inconsistent and ever changing. Complying with these various laws could cause us to incur substantial costs or require us to change our business practices in a manner adverse to our business.

Corporate tax reform, base-erosion efforts and tax transparency continue to be high priorities in many countries. Tax reform legislation is being proposed or enacted in a number of jurisdictions where we do business. During 2015, the Organization for Economic Cooperation and Development (OECD) released final reports on various action items associated with its initiative to prevent Base Erosion and Profit Shifting (BEPS). In 2020, the OECD further proposed a two-pillar approach to global taxation (BEPS 2.0), focusing on global profit allocation and a global minimum tax rate. While consensus has yetrate and in December of 2021, both the OECD and the EU released model rules and draft directives with respect to be reached on

In addition, our tax filings for various years are subject to examination by domestic and international taxing authorities and, during the ordinary course of business, we are under audit by various tax authorities. Recent and future actions on the part of the OECD and various governments have increased scrutiny of our tax filings. Although we believe that our tax filings and related accruals are reasonable, the final resolution of tax audits may be materially different from what is reflected in our historical tax provisions and accruals and could have a material adverse effect on our effective tax rate, financial position, results of operations, and cash flows.

As of December 31, 2020,2021, we had approximately $119.5$120.1 million of accumulated undistributed earnings in our non-U.S. subsidiaries. Our cash and cash equivalents are held in numerous locations throughout the world. At December 31, 2020, 56%2021, 31% of our cash and cash equivalents was held overseas, with a substantial portion representing accumulated undistributed earnings of our non-U.S. subsidiaries. Under generally accepted accounting principles in the United States of America, no provision for income taxes that may result from the remittance of accumulated undistributed foreign earnings is required if the Company intends to reinvest such earnings overseas indefinitely. The Company intends to continue to reinvest its accumulated undistributed foreign earnings, except in instances where the repatriation of those earnings would result in minimal additional tax. As a result, we have not recognized income tax expense on the amounts deemed permanently reinvested.

None.

 

As of December 31, 2020,2021, we leased approximately 20 domestic and 7065 international office properties for our ongoing business operations. These offices, which exclude certain properties that we sublease to others, support our executive and administrative activities, research and consulting, sales, systems support, operations, and other functions. Our corporate office is based in Stamford, Connecticut. We also maintain an important presence in: Fort Myers, Florida; Arlington, Virginia; Egham, the United Kingdom; Gurgaon, India; Irving, Texas; and Barcelona, Spain. The Company does not own any real property.

Our Stamford corporate headquarters is comprised of leased office space in three buildings located on the same campus. Our lease for the Stamford headquarters facility expires in 2027 and contains three five-year renewal options at fair value. Additionally, we lease office space in a fourth building adjacent to our Stamford headquarters facility under a lease designed to be co-terminus with our headquarters lease. We have options for additional space in this fourth building.

We are involved in legal and administrative proceedings and litigation arising in the ordinary course of business. We believe that the potential liability, if any, in excess of amounts already accrued from all proceedings, claims and litigation will not have a material effect on our financial position, cash flows or results of operations when resolved in a future period.

Not applicable.

Our common stock is listed on the New York Stock Exchange under the symbol “IT”. As of February 12, 2021,17, 2022, there were 1,0651,010 holders of record of our common stock. Our 20212022 Annual Meeting of Stockholders will be held virtually on June 3, 2021. We did not submit any matter to a vote of our stockholders during the fourth quarter of 2020.2, 2022.

 

The equity compensation plan information set forth in Part III, Item 12 of this Annual Report on Form 10-K is hereby incorporated by reference into this Part II, Item 5.

 

The purpose of this Management’s Discussion and Analysis (“MD&A”) is to facilitate an understanding of significant factors influencing the operating results, financial condition and cash flows of Gartner, Inc. Additionally, the MD&A conveys our expectations of the potential impact of known trends, events or uncertainties that may impact future results. You should read this discussion in conjunction with our consolidated financial statements and related notes included in this Annual Report on Form 10-K. Historical results and percentage relationships are not necessarily indicative of operating results for future periods. References to “Gartner,” the “Company,” “we,” “our” and “us” in this MD&A are to Gartner, Inc. and its consolidated subsidiaries.

In addition to historical information, this Annual Report on Form 10-K contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are any statements other than statements of historical fact, including statements regarding our expectations, beliefs, hopes, intentions, projections or strategies regarding the future. In some cases, forward-looking statements can be identified by the use of words such as “may,” “will,” “expect,” “should,” “could,” “believe,” “plan,” “anticipate,” “estimate,” “predict,” “potential,” “continue” or other words of similar meaning.

Gartner, Inc. (NYSE: IT) is the world’s leading researchdelivers actionable, objective insight to executives and advisory company and a member of the S&P 500. We equip business leaders with indispensable insights, advicetheir teams. Our expert guidance and tools to achieve their mission–enable faster, smarter decisions and stronger performance on an organization’s mission critical priorities today and build the successful organizations of tomorrow. We believe our unmatched combination of expert-led, practitioner-sourced and data-driven research steers clients toward the right decisions on the issues that matter most. priorities.

We are a trusted advisor and an objective resource for more than 14,00015,000 enterprises in more thanapproximately 100 countries and territories — across all major functions, in every industry and enterprise size.

Gartner delivers its products and services globally through three business segments – Research, Conferences and Consulting, as described below.

Of the three business segments in which we operate, Research and Consulting have returned to growth levels that were in line with our growth prior to the pandemic. However, Conferences continues to be negatively impacted. We have seen negative impacts to all of our segments with Conferences being the most impacted. On March 25, 2020, we announced the cancellation of allcancelled in-person conferences through August 2020. On July 2,scheduled for 2020 we announced the cancellation of all in-person conferences forbeginning in late February/early March 2020 with the remainder being cancelled after the World Health Organization’s declaration of the COVID-19 pandemic later in March 2020. We held 15began holding virtual conferences during the second half of 2020, and plan on holding approximately 202020. We held 39 virtual conferences from Februaryduring the year ended December 31, 2021 through August 2021.and expect to continue to deliver conferences virtually during 2022. These virtual conferences are expected to resulthave resulted in significantly less revenue and gross contribution than in-person conferences, but we believe they aid in client retention and engagement. The safety of our associates and clients remain our top priority so futureWe are operationally planning to re-launch in-person destination conferences will be held only if we determine the relevant impacts of COVID-19 have sufficiently receded in the jurisdictions where our conferences are to be held.when conditions permit.

As of December 31, 2020, we had approximately $16 million recorded in Prepaid expenses and other current assets on the balance sheet related to cancelled conferences. We expect to recover the majority of these and potential termination costs for future conferences through either force majeure clauses in our vendor contracts, other arrangements with vendors or event cancellation insurance claims. For cancelled conferences, our event cancellation insurance enables us to receive an amount up to the lost contribution margin per conferenceexpected revenues, plus incurred expenses.expenses minus saved expense. Our event cancellation insurance provides up to $170 million in coverage for 2020 with the right to reinstate that amount one time if those limits are utilized. The insurer has contested our right to reinstate limits. Gartner also has event cancellation insurance for 2021, covering events that were planned for 2021 but cancelled, of up to $150 million with the right to reinstate up to that amount one time if the initial limits and to include in reinstated limits conferencesare inadequate. The insurer has contested all coverage for events planned for 2021 but cancelled due to COVID-19. We are in litigation with the insurer on these issues. In 2021, we received $166.9 million of proceeds related to 2020 insurance claims, and recorded a gain of $152.3 million. The timing of receiving the remaining proceeds from these2020 and 2021 insurance claims is uncertain so we will not record any insurance claims in excess of expenses incurred related to the remaining claims until the receipt of the insurance proceeds.proceeds is deemed to be realizable. Our insurance coverage for 2022 (and likely beyond) excludes cancellation due to communicable diseases.

nm = not meaningful

Total revenues for 20202021 were $4.1$4.7 billion, a decreasean increase of $145.9$634.6 million or 3% compared to 2019 both2020, or 15% on a reported basis and 14% excluding the foreign currency impact. The tables below present (i) revenues by geographic region (based on where the sale is fulfilled) and (ii) revenues by segment for the years indicated (in thousands).

Refer to the section of this MD&A below entitled “Segment Results” for a discussion of revenues and results by segment.

Cost of services and product development was $1.3$1.4 billion in 2020, a decrease2021, an increase of $205.5$99.1 million compared to 2019,2020, or 13%7% on both a reported basis and 6% excluding the foreign currency impact. The decrease in Cost of services and product developmentincrease was primarily due to decreasedincreased compensation costs, related to cancellations of conferences during fiscal year 2020 in response to the COVID-19 pandemic, lowerconference expenses and program expenses, partially offset by reduced travel and entertainment costs during the year as well as the implementation of various cost avoidance

Selling, general and administrative (“SG&A”) expense was $2.0$2.2 billion in 2020, a decrease2021, an increase of $64.5$116.7 million compared to 2019,2020, or 3%6% on both a reported basis and 4% excluding the foreign currency impact. The decreaseincrease in SG&A expenseduring the year ended December 31, 2021, as compared to the prior fiscal year, was primarily due to reduced internal meetings, travelcharges associated with the impairment of right-of-use assets and entertainmentother long-lived assets, net of a reduction in lease liabilities, of $49.5 million related to certain office locations we no longer intend to use. Additionally, conference-related expenses increased due to expenses on cancelled conferences. SG&A expense also increased due to higher personnel costs and corporate expenses,in the current year, partially offset by higher payroll related expenses.reduced severance costs. There was a slight decrease in the number of quota-bearing sales associates in Global Technology Sales and an increase in Global Business Sales to 3,0893,072 and 846,934, respectively, at December 31, 2020.2021. On a combined basis, the total number of quota-bearing sales associates decreasedincreased by 5%2% when compared to December 31, 2019.2020. SG&A expense as a percent of revenues was 46% and 50% during both2021 and 2020, and 2019.respectively.

Depreciation increased by 14%9% during 20202021 compared to 2019.2020. This increase was due to additional investments, including new leasehold improvements as additional office space went into service, and capitalized software.

Amortization of intangibles decreased by 4%12% during 20202021 compared to 20192020 due to certain intangible assets that became fully amortized in 20202021 and 2019.

Interest expense, net increased by $13.7$3.1 million during 20202021 compared to 2019.2020. The increase in interest expense, net was primarily due to higher weighted average annual effective rates related toan increase in debt, partially offset by a reduction in the replacementamortization of expired interest rate swaps with interest rate swaps containing higher effective interest rates in late 2019. Additionally, we wrote off $1.8debt issuance costs.

Gain on event cancellation insurance claims of $152.3 million of deferred financing fees related to the prepayment of $787.9 million on the Term Loan A facility under the 2016 Credit Agreement during the year ended December 31, 2020.

Loss on extinguishment of debt during the year ended December 31, 2020 was related to the early redemption premium and write-off of deferred financing fees on our redemption of the 2025 Notes on September 28, 2020.

Other income (expense) income,, net for the years presented herein included the net impact of foreign currency gains and losses from our hedging activities, as well as sales of certain state tax credits and the recognition of other tax incentives. During 2021 and 2020, Other income (expense), net included a $20.2 million and a 2.2 million gain on de-designated interest rate swaps, respectively. Other income (expense), net for the year ended December 31, 2020 also included the release of $10.3 million from Accumulated other comprehensive loss, net related to forecasted interest payments that were no longer probable on our interest rate swap contracts, due toas a result of the prepayment of $787.9 millionpayment under the Company’s Term Loan A facilitythen outstanding 2016 Credit Agreement term loan and repayment of all amounts outstanding under our revolving credit facility on our 2016 Credit Agreement. During 2020, Other (expense) income, net also included a $2.2 million gain on de-designated interest rate swaps. During 2019, Other (expense) income, net also included a pretax gain of $9.1 million from the Company’s sale of a minority equity investment.June 30, 2020.

The provisionProvision for income taxes was $176.3 million and $59.4 million during 2021 and $42.4 million during 2020, and 2019, respectively, with an effective income tax rate of 18.2% in 2020for both 2021 and 15.4% in 2019.2020. The Company completed intercompany sales of certain intellectual property in both 20202021 and 2019.2020. As a result, the Company recorded net tax benefits of approximately $54.1 million and $28.3 million during 2021 and $38.1 million during 2020, and 2019, respectively. These benefits represent the value of future tax deductions for amortization of the assets in the acquiring jurisdiction. In July 2020,jurisdiction, net of any tax recognized in the Company completed an intercompany contribution of a significant amount of intellectual property.selling jurisdiction. The Company’s intellectual property footprint continues to evolve and may result in tax rate volatility in the future. Note 12 — Income Taxes in the Notes to Consolidated Financial Statements provides additional information regarding the Company’s income taxes.

Net income was $793.6 million and $266.7 million during 2021 and $233.3 million during 2020, and 2019, respectively. Additionally, our diluted net income per share increased by $0.40$6.25 in 20202021 compared to 2019.2020. These year-over-year changes reflect: (i) the increase in our 20202021 operating income, partially offset by: (i)income; (ii) the gain on event cancellation insurance claims; (iii) the prior year loss on extinguishment of debt; (ii)and (iv) higher Interest expense,Other income (expense), net, and Other (expense) income, net; and (iii) a higher effectivepartially offset by increased income tax rateexpense due to higher pre-tax income in 20202021 compared to 2019.

We evaluate reportable segment performance and allocate resources based on gross contribution margin. Gross contribution is defined as operating income or loss excluding certain Cost of services and product development expenses, SG&A expenses, Depreciation, Amortization of intangibles, and Acquisition and integration charges. Gross contribution margin is defined as gross contribution as a percent of revenues.

In response to the COVID-19 pandemic, we cancelled all in-person conferences from March 2020 through at least AugustDecember 2021, and pivoted to producing virtual conferences with a focus on maximizing the value we deliver to our clients. We held 39 virtual conferences during the year ended December 31, 2021. During 2020, we successfully held 5 in-person conferences prior to the COVID-19 pandemic and 15 virtual conferences during the second half of the year. We began holding virtual Evantaexpect to continue to deliver conferences virtually during the second quarter of 2020.2022, but are operationally planning to re-launch in-person destination conferences when conditions permit. Conferences revenues decreasedincreased by $356.7$94.3 million during 20202021 compared to 2019,2020, or 75%78%, on both a reported basis and excluding the foreign currency impact. The increase in revenues for the year ended December 31, 2021 was due to the virtual conferences held during the period, as well as the use of ticket entitlements which we extended from 2020 due to the pandemic. The segment gross contribution margin was 62% and 48% in 2021 and 51% in 2020, and 2019, respectively. The lowerhigher gross contribution margin during 20202021 was primarily due to the impact of COVID-19 noted above.increased revenues.

Consulting revenues decreased 4%increased 11% during 20202021 compared to 20192020 on a reported basis and 5%9% excluding the foreign currency impact. The decreaseincrease in revenues on a reported basis was due to a 6% decrease13% increase in labor-based consulting, partially offset byand a 3%4% increase in contract optimization. Contract optimization revenue may vary significantly and, as such, 20202021 revenues may not be indicative of future results. The segment gross contribution margin was 38% and 31% in 2021 and 30% in 2020, and 2019, respectively. The increase in gross contribution margin during 20202021 was primarily due to benefits derived from certain cost-reduction initiatives, including a declinethe increase in travel and entertainment expenses due to COVID-19 travel restrictions.revenue.

Backlog decreasedincreased by $15.4$13.4 million, or 13%, from December 31, 20192020 to December 31, 2020. The $100.3 million of backlog at December 31, 2020 represented approximately four months of backlog, which is in line with our operational target.2021.

We finance our operations through cash generated from our operating activities and borrowings. Note 6 — Debt in the Notes to Consolidated Financial Statements provides additional information regarding the Company’s outstanding debt obligations. At December 31, 2020,2021, we had $712.6$756.5 million of cash and cash equivalents and approximately $1.0 billion of available borrowing capacity on the revolving credit facility under our 2020 Credit Agreement. We believe that the Company has adequate liquidity and access to capital markets to meet its currently anticipated needs for at leastboth the next twelve months. As a cautionary measure, we elected to suspend our share repurchase activity in March 2020. We resumed share repurchase activity in December 2020.months and the foreseeable future.

We have historically generated significant cash flows from our operating activities. Our operating cash flow has been continuously maintained by the leverage characteristics of our subscription-based business model in our Research segment, which is our largest business segment and historically has constituted a significant portion of our total revenues. The majority of our Research customer contracts are paid in advance and, combined with a strong customer retention rate and high incremental margins, has resulted in continuously strong operating cash flow. Cash flow generation has also benefited from our ongoing efforts to improve the operating efficiencies of our businesses as well as a focus on the optimal management of our working capital as we increase sales.

Our cash and cash equivalents are held in numerous locations throughout the world with 56%31% held overseas at December 31, 2020.2021. The Company intends to reinvest substantially all of its accumulated undistributed foreign earnings, except in instances where repatriation would result in minimal additional tax. As a result of the U.S. Tax Cuts and Jobs Act of 2017, we believe that the income tax impact if such earnings were repatriated would be minimal.

The table below summarizes the changes in the Company’s cash balances for the years indicated (in thousands).

Cash provided by operating activities was $1,312.5 million and $903.3 million in 2021 and $565.4 million in 2020, and 2019, respectively. The year-over-year increase was primarily due to (i) higher pre-tax income in 2020, (ii) improved collections, (iii)the 2021 period, in part due to a $152.3 million gain on event cancellation insurance claims, and an increase in Accounts payable and accrued and other liabilities due todeferred revenues resulting from increased accrued payroll, fringe benefits and customer deposits and (iv) reducedbookings in Research, partially offset by higher income tax payments offset by higher interest payments due to timing.and deferred commissions.

Cash used in investing activities was $80.5 million and $83.9 million in 2021 and $160.9 million in 2020, and 2019, respectively. The cash used in 2021 was for capital expenditures and the acquisition of Pulse Q&A Inc. The slight decrease from 20192020 to 20202021 was the result of reduced capital spending in response to the COVID-19 pandemic.pandemic, partially offset by the 2021 acquisition of Pulse Q&A Inc.

Cash used in financing activities was $1.2 billion and $416.2 million in 2021 and $286.0 million in 2020, and 2019, respectively. During the 2021 period, we issued $600.0 million of 3.625% Senior Notes due 2029, and repaid $100.0 million on our term loan facility under the 2020 Credit Agreement with a portion of the proceeds from the issuance of the 2029 Notes. During 2021, we used $1.7 billion of cash for share repurchases. During 2020, the Company repaid a net $148.0 million on our revolving credit facility under the 2016 Credit Agreement, paid a net $58.5 million in debt principal repayments, borrowed $5.0 million on our revolving credit facility under the 2020 Credit Agreement and used $176.3 million of cash for share repurchases. Additionally, we paid $25.8 million in deferred financing fees related to our financing activities and $30.8 million in early redemption premium payments related to the repayment of our

2025 Notes. See Note 6 — Debt in the Notes to Consolidated Financial Statements provides additional information regarding the Company’s financing activities in 2020. During 2019, the Company borrowed $5.0 million, repaid a net $7.0 million on our revolving credit facility under the 2016 Credit Agreement, paid a net $102.6 million in debt principal repayments2021 and used $199.0 million for share repurchases.2020.

As of December 31, 2020,2021, the Company had $2.0$2.5 billion of principal amount of debt outstanding. Note 6 — Debt in the Notes to Consolidated Financial Statements provides additional information regarding the Company’s outstanding debt obligations.

Through December 31, 2020,2021, the Company has not entered into any material off-balance sheet arrangements or transactions with unconsolidated entities or other persons.

The table below summarizes the Company’s future contractual cash commitments as of December 31, 20202021 (in thousands).