Forrester Research(FORR)2024-11-06 02:56Financial Data and Key Metrics Changes - Revenue decreased by 10% in Q3 2024, totaling 113.4 million in the prior year period [21] - Contract value (CV) declined by 5% to 5.6 million, with earnings per share at 0.44 in Q3 2023 [26] Business Line Data and Key Metrics Changes - Research revenues decreased by 4%, with subscription research products down by 1% [21] - Consulting business revenues were 2.1 million, representing a 54% decrease compared to Q3 2023, driven by event mergers and lower sponsorship [24] Market Data and Key Metrics Changes - The company reported good performance in Premier high-tech, International, and government sectors, with significant deals including a 1.6 million deal with a U.S. government agency [9] - Overall client retention was 73%, up slightly from Q2, while wallet retention remained stable at 89% [21] Company Strategy and Development Direction - The company is focused on completing the migration to Forrester Decisions, with 78% of CV now in this platform, targeting over 80% by year-end [7][22] - The launch of new services in response to AI demand, including a dedicated FD service for data, AI, and analytics leaders, is part of the strategic direction [10] - The sales strategy emphasizes selling to C-level executives and maintaining a standardized sales process to drive growth [13][14] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges in the economic environment but expressed confidence in the ongoing stabilization of CV and retention metrics [19][30] - The transition to Forrester Decisions is nearing completion, and the company is optimistic about the potential for growth in 2025 [18][30] Other Important Information - The company divested its FeedbackNow product line for 9 million note due in 2025, which has been reflected in the updated client metrics [20] - Operating expenses decreased by 7%, primarily due to lower compensation costs, while operating income decreased by 33% [25] Q&A Session Summary Question: What is the health of the end market and the performance of CV bookings? - Management noted good performance across several sectors but acknowledged weakness in one group, with adjustments made to improve execution [34] Question: What are the expectations for client budgets in 2025? - Research indicates that tech budgets are increasing in 2025, aligning with Forrester's strategy [35] Question: How does the company measure traction in its go-to-market strategy? - The company tracks progress through various metrics, including pipeline and retention, and is focused on executing its retention lifecycle [37][38] Question: What is the outlook for contract value bookings and revenue growth for next year? - While not providing specific guidance, management expects stabilization and potential growth in CV, with improvements in consulting and events bookings [43][44] Question: What is the status of the sales team and their ability to penetrate senior executives? - The sales organization has undergone extensive training and is focused on connecting with senior executives, with ongoing support for continuous improvement [48][49] Question: What pushback is the company hearing from clients regarding expanding FD seats? - Budget constraints are a common pushback, but management emphasizes the need to demonstrate value to overcome this challenge [53]