Forrester Research (FORR) 8-K Forrester Research Reports Third-Quarter Financial Results

Exhibit 99.1

FOR IMMEDIATE RELEASE

Forrester Research Reports Third-Quarter Financial Results

Cambridge, Mass., October 29, 2008. . . Forrester Research, Inc. (Nasdaq: FORR) today announced its financial results for the third quarter ended September 30, 2008.

Third-Quarter Financial Performance

• Total revenues were $59.5 million, compared with $51.1 million for the third quarter of last year.

• On a GAAP-reported basis, which reflects an effective tax rate of 37 percent, Forrester reported net income of $6.4 million or $0.27 per diluted share, compared with net income of $6.8 million, or $0.29 per diluted share for the same period last year.

• On a pro forma basis, which reflects a pro forma effective tax rate of 39 percent, net income was $7.4 million or $0.31 per diluted share for the third quarter of 2008. Pro forma net income excludes non-cash stock-based compensation of $1.3 million, amortization of acquisition-related intangible assets of $282,000, gains on non-marketable investments of $26,000, and expenses related to the stock option investigation and restatement of the Company’s historical financial statements of $487,000. For the third quarter of 2007, pro forma net income was $6.7 million, or $0.28 per diluted share, which excludes non-cash stock-based compensation of $1.4 million, amortization of acquisition-related intangible assets of $293,000, gains on non-marketable investments of $98,000, and expenses related to the stock option investigation and restatement of the Company’s historical financial statements of $808,000, and which reflects a pro forma effective tax rate of 39 percent.

Nine-Month Period Ended September 30, 2008 Financial Performance

• Total revenues were $178.0 million, compared with $153.6 million for the same period last year.

• On a GAAP-reported basis, which reflects an effective tax rate of 39 percent, Forrester reported net income of $20.1 million, or $0.85 per diluted share for the nine months ended September 30, 2008, compared with net income of $13.3 million or $0.56 per diluted share for the same period last year.

• On a pro forma basis, net income was $22.2 million or $0.94 per diluted share, for the nine months ended September 30, 2008. Pro forma net income excludes non-cash stock-based compensation of $4.0 million, amortization of acquisition-related intangible assets of $476,000, net gain on marketable and non-marketable investments of $2.1 million, and expenses related to the stock option investigation and restatement of the Company’s historical financial statements of $1.1 million, and which reflects a pro forma effective tax rate of 39 percent. For the same period in 2007, pro forma net income was $18.8 million, or $0.79 per diluted share, which excludes non-cash stock-based compensation of $5.8 million, amortization of acquisition-related intangible

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Forrester Third-Quarter 2008 Information / Page 2

assets of $978,000, net impairments from non-marketable investments of $1.7 million, and expenses related to the stock option investigation and restatement of the Company’s historical financial statements of $3.6 million, and which reflects a pro forma effective tax rate of 39 percent.

“Forrester’s third-quarter financials were solid despite the economic slowdown,” said George F. Colony, Forrester’s chairman of the board and chief executive officer. “We achieved our revenue and profit goals and are cautiously optimistic about the rest of 2008. During the third quarter, we continued to add new clients while renewing and enriching our existing clients, an indication that our role-based strategy provides clients with sustained relevancy even during uncertain economic times.”

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

Forrester is providing fourth-quarter 2008 financial guidance as follows:

Fourth-Quarter 2008 (GAAP):

• Total revenues of approximately $64 million to $70 million.

• Operating margin of approximately 14 percent to 18 percent.

• Other income of approximately $1.5 million.

• An effective tax rate of approximately 39 percent.

• Diluted weighted average shares outstanding of approximately 23.7 million.

• Diluted earnings per share of approximately $0.30 to $0.35.

Fourth-Quarter 2008 (Pro Forma):

Pro forma financial guidance for the fourth quarter of 2008 excludes non-cash stock-based compensation expense of approximately $1.2 million to $1.5 million, amortization of acquisition-related intangible assets of approximately $500,000, costs related to the stock option investigation and restatement of the Company’s historical financial statements of $100,000 to $400,000, and any gains or impairment charges related to non-marketable investments.

• Pro forma operating margin of approximately 18 percent to 21 percent.

• Pro forma effective tax rate of 39 percent.

• Pro forma diluted earnings per share of approximately $0.35 to $0.39.

Forrester is providing full-year 2008 guidance as follows:

Forrester Third-Quarter 2008 Information / Page 3

Full-Year 2008 (GAAP):

• Total revenues of approximately $242 million to $248 million.

• Operating margin of approximately 14 percent to 16 percent.

• Other income of approximately $6.6 million.

• An effective tax rate of 39 percent.

• Diluted earnings per share of approximately $1.15 to $1.21.

Full-Year 2008 (Pro Forma):

Pro forma financial guidance for full-year 2008 excludes non-cash stock-based compensation expense of $5.1 million to $5.5 million, amortization of acquisition-related intangible assets of approximately $1 million, costs related to the stock option investigation and restatement of the Company’s historical financial statements of $1.1 million to $1.5 million, as well as any gains or impairment charges related to marketable and non-marketable investments.

• Pro forma operating margin of approximately 17.5 percent to 18.5 percent.

• Pro forma diluted earnings per share of approximately $1.29 to $1.33.

• An effective tax rate of 39 percent.

About Forrester Research

Forrester Research, Inc. (Nasdaq: FORR) is an independent research company that provides pragmatic and forward-thinking advice to global leaders in business and technology. Forrester works with professionals in 19 key roles at major companies providing proprietary research, consumer insight, consulting, events, and peer-to-peer executive programs. For more than 25 years, Forrester has been making IT, marketing, and technology industry leaders successful every day. For more information, visitwww.forrester.com.

Forrester Third-Quarter 2008 Information / Page 4

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 and operating guidance for the fourth quarter of and full-year 2008. 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 anticipate business and economic conditions, technology spending, market trends, competition, industry consolidation, the ability to attract and retain professional staff, possible variations in Forrester’s quarterly operating results, risks associated with Forrester’s ability to offer new products and services, and Forrester’s dependence on renewals of its membership-based research services and on key personnel. 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 income, consolidated balance sheets, and consolidated statements of cash flows are attached.

^© 2008, Forrester Research, Inc. All rights reserved.

Karyl Levinson	Michael A. Doyle
Vice President, Corporate Communications	Chief Financial Officer
Forrester Research, Inc.	Forrester Research, Inc
+ 1 617.613.6262	+ 1 617.613.6234
press@forrester.com	investor@forrester.com

Forrester Third-Quarter Fiscal 2008 Results/Page 5

Forrester Research, Inc.
Consolidated Statements of Income
(In thousands, except per share data)

	Three months ended September 30,				Nine months ended September 30,
	2008		2007		2008		2007
	(Unaudited)				(Unaudited)
Revenues
Research services	$	40,326	$	32,945	$	114,136	$	96,312
Advisory services and other		19,180		18,190		63,818		57,325
Total revenues		59,506		51,135		177,954		153,637
Operating expenses
Cost of services and fulfillment		21,806		18,648		65,848		60,106
Selling and marketing		20,282		17,913		60,119		52,813
General and administrative		7,529		7,002		22,945		22,533
Depreciation		1,012		1,026		2,998		2,881
Amortization of intangible assets		282		293		476		978
Total operating expenses		50,911		44,882		152,386		139,311
Income from operations		8,595		6,253		25,568		14,326
Other income, net		1,447		2,175		5,221		6,153
Realized gains (losses) from securities and non-marketable investments		26		98		2,136		(1,690	)
Income from operations before income taxes		10,068		8,526		32,925		18,789
Income tax provision		3,680		1,729		12,864		5,460
Net income	$	6,388	$	6,797	$	20,061	$	13,329
Diluted income per share from net income	$	0.27	$	0.29	$	0.85	$	0.56
Diluted weighted average shares outstanding		23,793		23,667		23,655		23,749
Basic income per share from net income	$	0.28	$	0.29	$	0.87	$	0.58
Basic weighted average shares outstanding		23,163		23,072		23,056		23,067
Pro forma data (1):
Income from operations	$	8,595	$	6,253	$	25,568	$	14,326
Amortization of intangible assets		282		293		476		978
Investigation related expenses		487		808		1,085		3,635
Non-cash stock-based compensation included in the following expense categories:
Cost of services and fulfillment		678		817		2,094		3,119
Selling and marketing		247		313		723		1,524
General and administrative		343		295		1,156		1,120
Pro forma income from operations		10,632		8,779		31,102		24,702
Other income, net		1,447		2,175		5,221		6,153
Pro forma income before income taxes		12,079		10,954		36,323		30,855
Pro forma income tax provision		4,711		4,272		14,166		12,033
Pro forma net income	$	7,368	$	6,682	$	22,157	$	18,822
Pro forma diluted earnings per share	$	0.31	$	0.28	$	0.94	$	0.79
Diluted weighted average shares outstanding		23,793		23,667		23,655		23,749

(1) Forrester believes that pro forma financial results provide investors with consistent and comparable information to aid in the understanding of Forrester’s ongoing business. Forrester uses pro forma financial information to manage its business, including use of pro forma results as the basis for setting targets for various compensation programs. Our pro forma presentation excludes amortization of acquisition-related intangible assets, non-cash stock-based compensation expense, net gains from securities and non-marketable investments, costs associated with the stock option investigation and restatement of our historical financial statements, as well as their related tax effects. The pro forma data does not purport to beprepared in accordance with Accounting Principles Generally Accepted in the United States.

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Forrester Third-Quarter Fiscal 2008 Results/Page 6

Forrester Research, Inc.
Consolidated Balance Sheets
(In thousands)

	September 30,			December 31,
	2008			2007
Assets:
Cash and cash equivalents	$	124,869		$	53,163
Available-for-sale securities		83,258			195,811
Accounts receivable, net		37,352			69,865
Deferred commissions		8,497			10,631
Deferred income taxes, net		7,489			13,236
Prepaid expenses and other current assets		10,625			11,304
Total current assets		272,090			354,010
Available-for-sale securities		45,935			—
Property and equipment, net		6,932			6,834
Goodwill, net		69,253			53,677
Intangible assets, net		8,102			309
Deferred income taxes, net		6,831			2,274
Non-marketable investments and other assets		9,115			9,253
Total assets	$	418,258		$	426,357
Liabilities and stockholders’ equity:
Accounts payable	$	3,458		$	4,174
Accrued expenses		18,734			28,891
Deferred revenue		98,128			111,418
Total current liabilities		120,320			144,483
Non-current liabilities		6,894			6,858
Preferred stock		—			—
Common stock		291			282
Additional paid-in capital		310,955			284,431
Retained earnings		101,539			81,478
Treasury stock, at cost		(116,514	)		(90,428	)
Accumulated other comprehensive loss		(5,227	)		(747	)
Total stockholders’ equity		291,044			275,016
Total liabilities and stockholders’ equity	$	418,258		$	426,357

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Forrester Third-Quarter Fiscal 2008 Results/Page 7

Forrester Research, Inc.
Consolidated Statements of Cash Flows
(In thousands)

	Nine months ended September 30,
	2008			2007
	(Unaudited)			(Unaudited)
Cash flows from operations:
Net income	$	20,061		$	13,329
Adjustments to reconcile net income to net cash provided by operating activities -
Depreciation		2,998			2,881
Amortization of intangible assets		476			978
Non-cash stock-based compensation		3,973			5,763
Increase in provision for doubtful accounts		494			380
Deferred income taxes		2,961			3,991
(Gains) impairments from non-marketable investments, net		(79	)		1,690
Gains on sales of available-for-sale securities		(2,057	)		—
Amortization of premiums on available-for-sale securities		626			473
Changes in assets and liabilities, net of acquisition -
Accountsreceivable		34,518			24,147
Deferredcommissions		2,134			2,216
Prepaidexpensesandothercurrentassets		2,290			(4,146	)
Accountspayable		(1,056	)		(338	)
Accruedexpenses		(10,035	)		(6,116	)
Deferredrevenue		(16,951	)		(16,053	)
Net cash provided by operating activities		40,353			29,195
Cash flows from investing activities:
Acquisition of Jupiter		(23,398	)		—
Purchases of property and equipment		(2,730	)		(3,826	)
Proceeds from non-marketable investments		250			1,058
Decrease in other assets		344			26
Proceeds from sale of discontinued operations		—			250
Purchases of available-for-sale securities		(966,671	)		(872,420	)
Proceeds from sales and maturities of available-for-sale securities		1,028,902			845,631
Net cash provided by (used in) investing activities		36,697			(29,281	)
Cash flows from financing activities:
Proceeds from issuance of common stock under stock option plans and employee stock purchase plan		17,246			811
Tax benefits related to stock options		5,314			—
Acquisition of treasury shares		(26,086	)		—
Net cash (used in) provided by financing activities		(3,526	)		811
Effect of exchange rate changes on cash and cash equivalents		(1,818	)		938
Net increase in cash and cash equivalents		71,706			1,663
Cash and cash equivalents, beginning of period		53,163			39,157
Cash and cash equivalents, end of period	$	124,869		$	40,820

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