FORR - Earnings call transcript Q2 2024 | Forrester Research, Inc.

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Operator

Good afternoon, and thank you for standing by. Welcome to Forrester's Second Quarter 2024 Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to turn the conference over to Vice President of Corporate Development and Investor Relations, Ed Bryce Morris. Please go ahead.

Edward Morris

Thank you. everyone. hello, And today's joining Thanks call. for Earlier this the press for issued quarter we XXXX. our second release afternoon,

If a website in you on the one need Investors copy, you section. find can our

George for Chairman; and also Sales Finn, today the our to Chief Here Johnson, Officer. Officer, the here Chris of Chief Nate Product call. with and results are Officer; Chief us and are Q&A Officer section Executive Colony, Carrie discuss us our Financial with Forrester's Chief Swan,

to like forward-looking intends, I'd could statements. Factors Exchange such expectations results the on to begin, as These you cause of from meaning reports that any results the the are contain we plans Before believes, current Litigation plans, company's Words will call remind similar statements. expressions statements and forth of new otherwise. intended statements of different are update anticipates, involve and this in and discussed with or set in and undertakes information, no operations as company events whether future and could or and And publicly risks materially forward-looking expects, be XXXX. the to based within estimates our forward-looking filings that uncertainties Reform identify Private a Securities the Act that of to future statements differ are activities Securities the Commission. result cause forward-looking those obligation to actual these

will previous we which on calls, be our items unadjusted with today excludes our consistent comparability. discussing basis, Lastly, an affecting performance

meaningful discussion. basis this adjusted we not comparison accordance a GAAP, on that basis believe reporting is unadjusted an provides appropriate numbers for and an on in reporting While our basis with

our adjusted with of from these press I'll it George. a items detailed hand list results You to can over release. And find that, excluded in

George Colony

the to quarter financial Finn before X And and over second you, investor management and and to the to product; cover Forrester Forrester's will following turning Forrester's performance; the like quarter one, financial Chris QX enhancements update. three, for Forrester's XXXX team our themes we're call. I the welcome our Board. two, Decisions in Number everyone call Thank events; Ed. changes I'd to second making four,

to performance. second first Turning quarter

While in CV representing a X% deals, CV business renewal driven Decisions, quarter, or and by decrease cross-sell growth beat plan year-over-year. These both and bookings vendor user value total rates of showed of our new the results we of clients. of X%, greater-than-expected contract were a improving flow from improved enterprise volume Forrester

primarily XX%. Despite X was increased movement As revenue a to businesses. in underperformance in point our and Events wallet down XX% result, driven retention year-over-year, positive QX by by value bookings, contract Consulting

XX% contract in continue on XX% at Forrester stay our plan Forrester XX% hit our We Forrester in Decisions. the to Decisions QX. was converting In We to on Decisions, up QX, of of to by of over of target track CV remain from value end CV year-end.

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as they of flow rates deals more a multiyear renew Forrester, company For predictable higher beneficial the give revenue. are and at

move to contracts multiyear. XX% our FD to of is goal long-term research Our

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Chris Finn

George, business everyone. saw our good plan, revenue modestly performed bookings improved QX. expectations, quarter signs metrics the positive and retention in line and CV exceeded in our in Thanks, We afternoon, as from CV second with

non-CV challenged. portion be However, the the of to business continues

have Events Our the in headwinds is Consulting quarter, continue. our Events and seen largest what we business underperformed in

XX% we in financial in Although of of trends in to of have are the year. Despite contribution positive these guidance in retention businesses the our from transitory QX our business metrics. the deals, reaching we by nature, CV for headwinds of our non-CV Forrester Decisions, challenges the results, QX, multiyear lower mixed us led ever-growing including into and continuation ongoing believe are improvements our encouraged the an CV

CV customer Our XX%. new us revenue a X% continued ability in marketing a renewal positive to slight QX, and by flat pay business improvement slightly deliver the and performance from involving work year-end. CV confidence overall decline QX. starting And decreased gives from This perspective. in to our in to go-to X% success is renewed market sales, declined dividends pipeline,

million For million we revenue, compared period. in to the $XXX.X in the prior-year total generated company, $XXX.X

research down our retention smaller products. Overall retention of reprint our revenue XX% discontinued first X%, QX, coupled the retention our decreased for improved quarter, terms from retention subscription and our X% XX% Decisions client was and products with revenue to research slightly second with down wallet compared XX% quarter. the versus quarter declines client In of specific wallet the improved Forrester of of slightly and while compared of revenues XX% XXXX, to of breakdown and other in

expect the in we As Decisions XXXX, slowly year. we throughout complete improve metrics to the Forrester retention migration

overall count remains for our platform, with be Decisions client retention the retention CV Although or count grow CV $XXX inherent grow, Forrester on remain And down with meaningfully Forrester Forrester to points. the also now down, count million quarter, Decisions continues total Decisions client per of approximately client the future. We client track to that client CV grow. should is noted we plan, from X and Forrester though even Decisions well cross-sell CV the opportunities per It platform. is continues to overall above client the and client of approximately continue prior believe will have migration on into we and upsell XX% by

at be in are will Feedback on as We XX% The the total and business, in like non-Forrester targeting legacy CV XX% less Reprints Now X% Forrester year-end. our approximately than products. well of products remaining as the Decisions research Decisions

events Events revenues decisions related cautious impacting throughout revised Events posted of challenges business outlook, Our a million, our first off Macro in will our second which Operating business, our discretionary challenging buying the XX% remainder decreased posted the primarily of put driven and the P&L quarter conditions declines and representing and was their product causing are second in to by spending basis. adjustment continue are the limit this lines XXXX. headwinds outlook decrease both Consulting $XX.X and of the being the quarter Consulting Both ticket expenses to to sales. We we X XX% and a compared to guidance extent, revenues compensation regarding lesser Consulting. And from our by primarily prior on These were we an and our cause $XX.X year. of down Consulting for the X%, lower The business had of driven held quarter. Continuing by is of on clients quarter finally, saw our costs. the compared a the headwinds Events Advisory Consulting and, year. adjusted for XXXX. Events lower sponsorship million, worsen This for our prior to with quarter. down

second the X% compared same down for we headcount, in on were the Specifically to period quarter, XXXX.

and compared second attrition in hiring declines quarter quarter the and in by or the income XX% primarily revenue We operating Interest was Lower margin monitor continue by $XX.X headcount, second $X.X XXXX. decreased up driven of to for the closely. Operating of in versus million to Consulting million income the million, XX.X% and XXXX. of the or current our very expense $XX.X XX% to revenue slightly revenue businesses. of were Events quarter quarter,

earnings decreased the the to per share net net in $XX.X current at net and of with $X.XX for and earnings XX% $XX.X Finally, $X.XX second share of income XXXX. earnings last of million and income million and quarter, at quarter of income compared XX%, year, with compared respectively, per per QX share

impacted million quarter. intact. in capital Looking had during exited first our We flow our as authorization $XXX.X as of was the Cash restructuring million at approximately the the leaves structure, of payment million quarter. half approximately the last of cash operating and under $X.X by the $XX settlement of flows $X.X XXXX, shares payments capital $X.X activities of we severance repurchase plans. We were our negative repurchased as well investments million were negatively and This expenditures from stock litigation cash million. quarter, worth

the Consulting XXXX the business expected million been business is XXs, decline, in be range remains business $XXX approximately year. for commentary million. the noted XXs earlier, mid-single-digit Events some in X.X%. updated, Interest the and to the high outlook to unchanged million a guidance decline range our year. Operating expected with of our so to a on $X expense the research for outlook expected $XXX in decline in me now in As a the for of This guidance now be Revenue the for has is to the provide assumes the are let be to X.X% year. additional margins low for in

we $X.XX earnings to guidance per now XX%. Taking a range tax continuing are in account, $X.XX. of of are to $X.XX, previous all share our of to guide rate We from full year down this approximately the expecting $X.XX to of into

as long-term all starting to progress ongoing migration to the we first Decisions we is signals AI research business. the within half Forrester generative core see the the through specifically to XXXX The disruption, the uneven some a and positive expected, finish for proving year growth be business. Thank an time value of George. As challenging amid importance Decisions backdrop. technology Forrester will XXXX. We We're macroeconomic XXXX, clients our of supporting call believe retention the product, as our are the stage change, and our enhancements hand setting to in the and And go-to-market new Consulting for ability business, I and with back drive through in of product today. Events strategy, guide the the trends that, the to you taking to improvements

George Colony

you, Thank Chris.

the now have over sponsorships. call in I we Events content listening, joined I'd members we Before two, X of in to Four, is scored innovations, short And fell it business Izola. the complete by Number track, stabilizing. reiterate operator to transition for hand and and year-end. Three, Board. Thank Forrester Number excellent is go will the Q&A. by Decisions be number new were for main themes. there product the you CV Q&A, the expect led QX a well to in but on our Forrester X, like one, to

Operator

I Soderstrom [Operator our Sidoti. comes from Instructions] show the line from Anja first question And of

Anja Soderstrom

lot You year. internal of have transitions on going a this

So you to the improve XXXX? show some how are in environment dependent revenue to growth macro in

George Colony

macro Your question looking for to was, we change? are

Anja Soderstrom

on like seems that of clients Yes. transitioning could in have XXXX. How you that things given dependent are you're internal to you you and -- expansion the with lot a for existing change, you help have going

So macro are improving? you on how dependent the environment also

George Colony

know made has always like in I it bit looking this, been I the But do the better, views to it help Board environment going than I to has I of was this my... rate on there has stronger to said, but our going And this difficult, think around year, economic the -- mean, going I much cuts Chris is second early general transition through I to the But we're rate think looking see somewhat of and here little being U.S. are a That's in think glimmers going the in think and a it's -- some know edges. -- about Anja, Europe meeting It's us. cuts second maybe talk help challenging. That this. I in there half XXXX. I that's more worse. year half the that's on economy. some the going -- doing

Chris Finn

with agree George. though, I environment, think, that, Yes. I in would general, significantly. I it's look, challenging don't this think given changed really

of perspective. But in result I helping we're continuing is a and environment. the and just but try early addressing to -- anything our and mean to I into team a relying a on are making think we're the end, sales think, CV issues find lot growth and positive from delve issues out made, it's starting right point, that on of your go-to perspective the nothing so tremendously. -- it's positive see we some that there. But macro of from still now where organization can. this work and forecast Nate that has to the a tough results yet, to market doing We're the and changing I lot is

George Colony

the tech the that, large is recovering, for doubt the Anja, large -- economy, And no still even vendors. about

Anja Soderstrom

coming how government is along? And Yes. clearance the

Nate Swan

earn We big well Nate. not and We government. around the our expecting -- we're just quarter. We're U.S. a Feel U.S. plan positioned have big confident for QX. quarter that the things very Anja, government in seeing, the but with that feel we world, team very in business. It's the opportunity from feel to federal obviously are in it's this like

around what excited we're across government the seeing world. So really excited, and about

George Colony

We're teams, alternative that the in want government Anja, an they hearing from space. research

on been we've that. so And engaging

Anja Soderstrom

Okay.

what was you for that? is the side. sponsorship surprise you And for reason like And year you of think What maybe, the of mostly do that? business, to kind hearing terms a are in that it improve Sounds what the bit of initiatives are exciting. next taking Events then on there? And seems

Carrie Fanlo

Carrie. business, is more we already imagine, can obviously, business what I of, out The a I'll take we XXX% struggled you saw value to look as companies a we a this do of -- tied needed to skills as the Anja, environment And the there, business. We record a Forrester about seen good as that team. react to on get outstanding leadership that. more elevating of sales track it's what that event sales similar our more bit to event, talked sponsorship a high-tech in we've industry. event, sponsorship challenging sell sort think the very core an of sponsorship in has new to of have leader has solution

So we're help will offering. confident off of we events market, that based we're the especially the changing experience us and leadership adjust that get can new strengths the there, to the

Operator

And I from of show our next Research. the Colicchio line question from Barrington Vincent comes

Vincent Colicchio

I'd of wondering salespeople if in involuntary. or there that's on a was an like the balanced force. Nate, strong, a a got total how you're the number drop number -- if is concentrated then Wondering in And if sales strength more you've Yes. like quarter. feel update about you feeling the There's force, sales the of in members. just few

Nate Swan

Yes, progress force. very Vince. sales we're Great Feel the making about with question. that very much. Thanks good the

that the an clients customer pipeline, are across QX, the community, really the one. Rolling that great work sales to issues then step is our get and including convert XX% analyst those, are on well. and and we in we've pipelines. success, first process the they're consistently Forrester across of X and of connecting retention working X retention sure that we place across it we improving. need we lots for of into delivering sales rolled the that to focused number were really the to We are building we've specific operations, working operational Forrester the system our across and in-quarter just messages sales was saw of actually with Very success, growth. on. All work, executives progress and were But to ecosystem, process more structured. And them the initiatives our the it lot on with the make We Pipelines with pleased So sure finally, a that our improvement Forrester, make with sales out in and senior-level getting really operating organization we had a pipeline. out sales made. so organization, organization, customer working

So about normal really just feel good is headcount attrition. sales that. The

it's really if We to them are not help trying management stepping management. organization. And into if they're our people and some the manage We're them the people sales hire want good the organization they with into the to successful. opt be. back our to will people back that intention business performance place be into program performance into our But bring is out then not We to performing. choose

going this we've we higher So a doing that. We're into bit little but did seeing was been XXXX, attrition year. than in that expected

nothing we'll So head in opportunity. we see of to really outside And count good a continue where bring the plan.

the headcount is So staying plan throughout single-digit year. this growth steady that with

So anything else I can clarify?

George Colony

Good candidates on though, right? the street

Nate Swan

That's point, a great George.

into have We know have coming is the we're my several of years a quality was I high-end it which difficult to about good from really talent. really the couple change seeing high some organization, been regions a of where find ago big seen commenting that candidates.

Vincent Colicchio

helpful to Did in you up quarters. slightly? Very CV was I that. X missed stabilize. say outlook the Chris, for you had And flat the CV It see next to nice mentioned color.

Chris Finn

the And we this heritage of as be continue general end then of by be slightly XX% the Yes. and heritage X% than point the of year through migration the the we're getting less the we're for continuing portion, And Vince, end I Well, high-risk to to point. X%. plus migration. expect a to on be heritage, in drive I at in that sub-XX, CV for year. And to overall the in flat than expect up FD confident full we mean, significantly. CV mean, by year, at this pretty from to we're We're less XX% than to we perspective, our less

year. the end track on fully the migration to the really are effort we of by be So through

George Colony

in sub-XX small million vendors, is below the Yes. $XX revenue. Vince, And

Chris Finn

Yes.

Vincent Colicchio

the it sounds George, of spur of helping you are impressive, seats? sales Izola, seeing additional And effectiveness

Nate Swan

I a but based see Vince. we say this, on in it. number jump wouldn't like what we can say there clients quantified on our I'll is with Izola,

a lot have it people what valuable come helps. We to back. through looking cut able and access, research, they're use to to so We be want of exactly for, to

are the So that, with Forrester. likely engage they more the quicker they to can get

to sales with love prepared Our people be it.

So they frankly, business. your show out how is to to did a prep this a actually go actually said, made your we and use really they help to helping have them. really quickly." So "Hey, good happen meeting and like did in seeing so we're some it lot make to We'd a that tech clients like signs they gotten our to from come within that prospects They're as and this then, talk help really product with some so work we on the to and this Izola team them. client back you've interested quickly. of how it issues we've And how and can of clients how done that us

Carrie Fanlo

so Carrie, Vince, add, is, to Insights, reminder, I'll available only new Forrester as thing a portfolio. in Forrester One and Market it's customers Izola the Decisions is

our migration So not it's from to helping also our sales heritage available It's a clients. perspective. discussions

George Colony

But the no, we're Izola what's it with for they're that is get some I saying, fact even are heritage product?" cannot. you clients heritage can "Hey, that And is saying, asking a great Vince, interesting, of we think sign. the the

Vincent Colicchio

to half? expect the the we buyback activity proactive you should on last one one. be in And second Chris,

Chris Finn

buybacks to we the absolutely performance year closely, be about look to watch Yes. opportunistic hasn't for rest to of as that and continue changed. going We're the

Operator

queue. I'm to Finn, I CFO, At back showing conference like this time, remarks. in further for Chris no to closing questions the turn would the

Chris Finn

Any contact just thank follow-up and myself. us Thank Yes. much. I'd everybody Ed for you please like today. to questions, joining very

Operator

Thank conference today's concludes you Thank call. you. This participating. for

may disconnect. You now

Forrester Research (FORR) 30 Jul 242024 Q2 Earnings call transcript