Research and advisory firm Gartner (NYSE: IT) met Wall Street’s revenue expectations in Q2 CY2025, with sales up 5.7% year on year to $1.69 billion. Its non-GAAP profit of $3.53 per share was 6.8% above analysts’ consensus estimates.

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Gene Hall, Gartner’s Chairman and Chief Executive Officer, commented, “Second quarter Revenue, Adjusted EBITDA, Adjusted EPS, and Free Cash Flow were ahead of expectations. Contract value grew 5%. Since the end of the first quarter, we have accelerated our stock buybacks to increase shareholder value. As we continue to rollout AskGartner, our new AI-powered tool that provides faster access to trusted, proprietary Gartner business and technology insights, clients will realize even more value from their licenses.”

Company Overview

With over 2,500 research experts guiding organizations through complex technology landscapes, Gartner (NYSE: IT) provides research, advisory services, and conferences that help executives make better decisions about technology and other business priorities.

Revenue Growth

A company’s long-term sales performance can indicate its overall quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years.

With $6.42 billion in revenue over the past 12 months, Gartner is one of the larger companies in the business services industry and benefits from a well-known brand that influences purchasing decisions.

As you can see below, Gartner grew its sales at a solid 8.9% compounded annual growth rate over the last five years. This shows it had high demand, a useful starting point for our analysis.

Long-term growth is the most important, but within business services, a half-decade historical view may miss new innovations or demand cycles. Gartner’s annualized revenue growth of 5.7% over the last two years is below its five-year trend, but we still think the results were respectable.

This quarter, Gartner grew its revenue by 5.7% year on year, and its $1.69 billion of revenue was in line with Wall Street’s estimates.

Looking ahead, sell-side analysts expect revenue to grow 5.6% over the next 12 months, similar to its two-year rate. This projection is above the sector average and implies its newer products and services will help support its recent top-line performance.

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Operating Margin

Operating margin is a key measure of profitability. Think of it as net income - the bottom line - excluding the impact of taxes and interest on debt, which are less connected to business fundamentals.

Gartner’s operating margin might fluctuated slightly over the last 12 months but has generally stayed the same, averaging 19.1% over the last five years. This profitability was elite for a business services business thanks to its efficient cost structure and economies of scale.

Analyzing the trend in its profitability, Gartner’s operating margin might fluctuated slightly but has generally stayed the same over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability.

This quarter, Gartner generated an operating margin profit margin of 19.4%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.

Gartner’s EPS grew at an astounding 27.6% compounded annual growth rate over the last five years, higher than its 8.9% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.

For Gartner, its two-year annual EPS growth of 10.5% was lower than its five-year trend. We hope its growth can accelerate in the future.

In Q2, Gartner reported adjusted EPS at $3.53, up from $3.22 in the same quarter last year. This print beat analysts’ estimates by 6.8%. Over the next 12 months, Wall Street expects Gartner’s full-year EPS of $14.46 to shrink by 10.6%.

Key Takeaways from Gartner’s Q2 Results

It was encouraging to see Gartner beat analysts’ EPS expectations this quarter despite in line revenue. Overall, this print was decent. The stock remained flat at $334 immediately following the results.

Should you buy the stock or not? If you’re making that decision, you should consider the bigger picture of valuation, business qualities, as well as the latest earnings. We cover that in our actionable full research report which you can read here, it’s free.