8-K: Forrester Research Q1 2026 Financial Results

Forrester Research reported Q1 2026 results with total revenues of $85.5 million, a decrease from the prior year, but raised its full-year revenue guidance.

Summary

• Forrester Research reported first-quarter 2026 revenues of $85.5 million, a decrease from $89.9 million in the first quarter of 2025.
• The company reported a GAAP net loss of $21.8 million ($1.14 per diluted share) for Q1 2026, compared to a net loss of $87.3 million ($4.62 per diluted share) in Q1 2025.
• Adjusted net loss for Q1 2026 was $0.7 million ($0.04 per diluted share), an improvement from an adjusted net income of $2.0 million ($0.11 per diluted share) in Q1 2025.
• Contract value was $285.3 million, down 3% year-over-year.
• Forrester is increasing its full-year 2026 revenue guidance to approximately $350.0 million to $360.0 million.
• The company is focusing on AI capabilities to enhance client research delivery and offer AI-focused research services.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this as a neutral to slightly positive filing, with revenue decline offset by improved guidance and strategic focus on AI, alongside positive retention metrics.

Positives

• Increased the low-to-midpoint range of revenue guidance for 2026.
• Improved Forrester AI capabilities, enabling clients to integrate research into their systems and workflows.
• Client retention improved to 78% from 73% in the prior year.
• Wallet retention improved to 89% from 86% in the prior year.
• Adjusted net loss improved significantly year-over-year, moving from a profit to a small loss.
• Cash, cash equivalents, and marketable investments increased to $145.5 million from $127.7 million.

Negatives

• Total revenues decreased to $85.5 million in Q1 2026 from $89.9 million in Q1 2025.
• Contract value decreased by 3% year-over-year to $285.3 million.
• Number of clients decreased to 1,760 from 1,822 in the prior year.
• Total headcount decreased to 1,395 from 1,510 in the prior year.
• GAAP net loss was $21.8 million in Q1 2026.

Risks

• Forrester's ability to retain and enrich memberships for its research products and services.
• Forrester's ability to fulfill existing or generate new consulting engagements and advisory services.
• Adverse economic conditions that result in a reduction in technology spending or demand for Forrester's products or services.
• Risks and challenges inherent in international business activities.
• The use of generative AI in Forrester's business and by its clients and competitors.
• Forrester's ability to offer new products and services.
• Forrester's dependence on key personnel and ability to attract and retain professional staff.
• Competition and industry consolidation.

Future Outlook

Forrester is increasing its full-year 2026 revenue guidance to approximately $350.0 million to $360.0 million. The company anticipates an operating margin of approximately negative 3.3% to negative 2.8% and a diluted loss per share of approximately $0.73 to $0.63 on a GAAP basis. On an adjusted basis, the company expects an operating margin of 6.0% to 6.5% and adjusted diluted earnings per share of $0.72 to $0.82.

Management Comments

• "We are seeing continued momentum in our metrics, which has allowed us to increase the low-to-midpoint range of our revenue guidance for 2026," said CEO and Chairman George F. Colony.
• "Furthermore, this quarter we improved Forrester AI capabilities, enabling clients to access Forresters research from their systems and workflows and to more easily incorporate our data and analysis into their emails, presentations, and documents."
• "We are attacking the AI opportunity from two directions - using AI to improve how we deliver our services and offering AI-focused research, which enables our clients to increase productivity and deliver increased value to their customers."
• "We believe our relentless focus on evolving our product portfolio to deliver better value to clients, and improving go-to-market execution, will continue to position us for a successful 2026."

Industry Context

StockSavvy.ai notes that Forrester's focus on AI capabilities aligns with a broader industry trend of integrating artificial intelligence into research and advisory services to enhance client value and operational efficiency. The company's efforts to improve AI delivery and offer AI-focused research are critical for maintaining competitiveness in a rapidly evolving market.

Comparison to Industry Standards

• The reported revenue decline of approximately 4.9% year-over-year for Q1 2026, based on $85.5 million in revenue compared to $89.9 million in Q1 2025, is a key metric. While specific industry benchmarks for research and advisory firms' revenue growth in Q1 2026 are not provided in the filing, many technology and information services companies are navigating a complex economic environment with varying growth rates.
• Forrester's adjusted net income of $0.11 per diluted share in Q1 2025 and adjusted net loss of $0.04 per diluted share in Q1 2026 indicates a shift. Competitors in the market may show different trends depending on their specific market focus and AI investment strategies. For example, Gartner (IT:NYSE) reported a 7.5% revenue increase in Q1 2026, showcasing a different trajectory.
• The improvement in client retention (78% vs 73%) and wallet retention (89% vs 86%) are positive indicators for Forrester, suggesting strong client relationships. Industry-standard retention rates can vary significantly, but improvements in these metrics are generally viewed favorably across subscription-based business models.

Stakeholder Impact

• Shareholders: Potential for improved future performance due to increased revenue guidance and strategic AI focus, despite current revenue decline and net loss.
• Employees: Continued focus on AI and product evolution may lead to new opportunities and skill development, but headcount reduction indicates potential workforce adjustments.
• Clients: Enhanced research delivery through AI capabilities and AI-focused research offerings could lead to increased productivity and value.
• Creditors: The company maintains $35 million in debt, and its financial performance will impact its ability to service this debt.

Next Steps

• Continue to improve Forrester AI capabilities.
• Offer AI-focused research to clients.
• Focus on evolving product portfolio and improving go-to-market execution.
• Achieve full-year 2026 revenue guidance of $350.0 million to $360.0 million.

Key Dates

Recommendation

The company shows signs of strategic adaptation with its AI focus and increased revenue guidance, alongside improved retention metrics. However, the continued revenue decline and net loss, coupled with a decrease in client numbers and headcount, warrant a cautious 'hold' recommendation until a clear trend of revenue growth and profitability emerges.

Keywords

Forrester Research, Financial Results, Q1 2026, Revenue Guidance, Contract Value, AI Capabilities, Client Retention, Adjusted Net Loss