Gartner (IT) Stock: Why It Fell 13% on Earnings and What's Next

Quick answer

Gartner traded at $203.78 at 11:50am ET on Nov 3, 2026, down 13.4% from a $235.26 close, after a third-quarter report that beat profit estimates but showed slow growth underneath. Adjusted earnings of $3.59 a share topped the consensus of about $2.84, and the company raised its full-year outlook. But contract value, the annual value of its research subscriptions, grew only 2.5% from a year earlier to $5.3 billion, and diluted shares were down 15% after $1.7 billion of buybacks in a year. The stock traded from $215 to $233.99 before the open, opened at $208 and fell to $184.95 at 9:35am before recovering part of the loss.

Our view: Bearish through December 31, 2026, the end of the quarter whose contract value, reported early next year, will show whether growth is really turning up. The case for the stock: contract value growth accelerated for a third straight quarter, adjusted EBITDA of $364 million beat the $327.5 million consensus, free cash flow rose to $275 million, full-year free cash flow guidance went to at least $1.235 billion, and the company keeps retiring stock. The case against: 2.5% contract value growth is slow for a stock priced as a compounder, much of the 30% gain in adjusted earnings per share came from a smaller share count rather than more profit, AI research tools are a live threat to how companies buy advice, and the average analyst target of $190.29 sits below even today's price. The stock also ran up 22% from Oct 1 into the report, so there is more of that gain to give back. We think the case against carries more weight. We would move off Bearish if the stock closes back above $215, if management shows fourth-quarter renewals running ahead of last year, or if analysts lift their targets above the price. This is a view on direction over that window, not a recommendation to trade the stock.

Gartner daily closing price from Sep 21 to Nov 3, 2026, with the Oct 1 start of the run-up, the Oct 22 jump and the Nov 3 earnings drop marked

Key takeaways

Gartner traded at $203.78 at 11:50am ET on Nov 3, 2026, down 13.4% from a $235.26 close, after a third-quarter report that beat profit estimates but showed contract value growing only 2.5% from a year earlier. It fell as low as $184.95 at 9:35am.
Adjusted earnings were $3.59 a share against a consensus of about $2.84, but they were calculated on 63.9 million diluted shares against 75.0 million a year earlier, so buybacks did much of the work.
Revenue fell 1.3% to $1.505 billion because the prior year included $55 million from a business Gartner has sold; adjusted revenue rose 2.4%.
The stock had risen 22% from its Oct 1 close into the report, and the average analyst price target of about $190 is below the price even after the drop.
Our view is Bearish through December 31, 2026: until contract value growth gets back well above 2.5%, the market is paying a growth multiple for a business whose per-share gains come mostly from a shrinking share count.

Table of contents

Nov 3, 2026: a profit beat on a shrinking share count
The numbers
The bull case
The risks
What comes next

Gartner closed Nov 2 at $235.26, near the top of a run that took it from $192.80 on Oct 1. It reported before the open and held its call at 8:00am ET. Premarket trading ranged from $215.00 to $233.99. The stock opened at $208.00, which was the high of the regular session, and dropped to $184.95 at 9:35am, down 21.4%, before buyers stepped in. At 11:50am it was $203.78, down 13.4%, on about 1.3 million shares.

What moved the stock:

Contract value growth is still slow. Currency-neutral contract value rose 2.5% from a year earlier and 1.1% from the prior quarter. Technology buyers, the larger group at $4.0 billion, grew 2.1%, and business functions, at $1.3 billion, grew 3.7%. Chief executive Gene Hall said contract value growth "accelerated again," but from a low base.
Buybacks did much of the earnings work. Adjusted earnings rose 30.1% to $3.59 a share, and IBTimes noted that the per-share figure used 63.9 million diluted shares against 75.0 million a year earlier. Adjusted EBITDA excluding the sold business rose 7.5%.
The run-up left little room. The shares had gained about 25% in the month before the report, IBTimes reported, so an in-line growth picture was not enough.
Research peers fell less. Forrester was down 1.7%, Verisk down 1.5%, S&P Global down 1.6% and FactSet down 3.0% late in the morning, a sign some of the selling was about AI risk to the whole group.

At 11:50am RSI(14) was 47, and the stock sat 3.8% below its 20-day average but still 3.6% above its 50-day and 20.8% above its 200-day average.

Bar chart of Gartner third-quarter 2026 growth from a year earlier: adjusted EPS +30.1%, adjusted EBITDA +7.5%, contract value +2.5%, adjusted revenue +2.4%, reported revenue -1.3%, diluted share count -14.8%

The numbers

Measure	Q3 2026	Year earlier	Change
Reported revenue	$1,505 million	$1,524 million	-1.3%
Adjusted revenue	$1,505 million	$1,469 million	+2.4%
Insights revenue	$1,292 million	$1,271 million	+1.7%
Adjusted EBITDA, excluding divested business	$364 million	$339 million	+7.5%
Adjusted EPS	$3.59	$2.76	+30.1%
Free cash flow	$275 million	$269 million	+2.2%
Diluted shares for adjusted EPS	63.9 million	75.0 million	-14.8%

Insights, the research subscription business, is 86% of revenue and grew 1.7%, with a 77.6% contribution margin. Conferences grew 15.4% and consulting 2.3%. GAAP earnings of $3.35 a share were up more than sixfold from $0.47 a year earlier, on net income of $214 million against $35 million. Our explainer on buybacks as catalysts covers when a falling share count deserves credit and when it is masking slow growth, and the rest of the session's movers are in today's biggest stock moves.

The bull case

Gartner is a high-margin subscription business that throws off cash. Free cash flow was $275 million in the quarter and the company now guides to at least $1.235 billion for the year, which funds buybacks of more than 10% of the share count a year at recent rates. Contract value growth has improved for three quarters in a row, margins in Insights rose, and the morning low of $184.95 was close to the average analyst target, a level where some buyers clearly saw value.

If the fourth quarter shows contract value growth heading toward the mid single digits, the per-share math works again: modest growth plus a shrinking share count can still produce double-digit earnings growth. Our page on free cash flow yield shows how to weigh that cash against the price.

The risks

The core risk is that 2.5% is the new normal. Gartner sells research and advice to technology and business leaders, and AI tools now answer many of the questions those leaders used to pay analysts for. A business growing low single digits does not usually hold a premium multiple, and buybacks cannot shrink the share count forever without more borrowing.

The second risk is the setup. A 22% run in a month priced in a clear acceleration, and the report delivered a slight one. The average analyst target is below the price, so there is little support from the Street, and our guide to earnings estimate revisions explains why targets tend to follow the price lower after a report like this. Our page on post-earnings announcement drift covers why gaps on slow growth often keep going.

What comes next

The fourth-quarter contract value number is the next real test. The company has not set a date for its fourth-quarter report, which usually comes in early February. Before then, watch for analyst target changes after the call, any comments at investor conferences about renewal rates, and whether the stock holds the $184.95 morning low. A close back above $215 would undercut the Bearish case.

Frequently asked questions

Why did Gartner stock fall on Nov 3, 2026?

Gartner fell 13.4% to $203.78 at 11:50am ET on Nov 3 after its third-quarter report. Profit beat estimates and full-year guidance went up, but contract value, its main measure of future subscription revenue, grew only 2.5% from a year earlier, and a large part of the earnings gain came from a 15% lower share count. The stock had also risen 22% in the month before the report.

What is Gartner's contract value?

Contract value is the annualized value of Gartner's subscription research contracts. It was $5.3 billion at Sep 30, 2026, up 1.1% from the prior quarter and 2.5% from a year earlier on a currency-neutral basis. Contract value from technology buyers grew 2.1% and from business functions 3.7%.

How much stock has Gartner bought back?

Gartner repurchased $1.7 billion of stock over the four quarters to Sep 30, 2026, including 0.9 million shares for $138 million in the third quarter. Diluted shares used for adjusted earnings fell to 63.9 million from 75.0 million a year earlier.

Why did Gartner's revenue fall?

Reported revenue fell 1.3% to $1.505 billion because the third quarter of 2025 included $55.2 million from the Digital Markets business, which Gartner has sold. Excluding it, adjusted revenue rose 2.4%. Insights revenue rose 1.7%, conferences 15.4% and consulting 2.3%.

What is Dombey's view on Gartner stock?

Bearish through December 31, 2026. This is a view on direction over that window, not a recommendation to trade the stock.

What would change the view on Gartner?

We would move off Bearish if the stock closes back above $215, the bottom of the premarket range, if management gives evidence that fourth-quarter renewals are running ahead of last year, or if analysts raise their targets above the price after the call.

Sources

Article details

By James Whitfield, Head of Equity Research, Dombey Capital

Published November 3, 2026 · 5 min read · Event-Driven Investing