SEC Regulation G and Item 10(e) of Regulation S-K establish disclosure requirements for companies presenting non-GAAP financial measures. These rules require that adjusted metrics be reconciled to the most directly comparable GAAP measure and that GAAP results receive equal or greater prominence. The regulations aim to prevent companies from using adjusted presentations to obscure underlying performance trends.
Gartner's February 3, 2026 fourth quarter earnings release presented a narrative that emphasized the company's earnings-per-share beat relative to analyst estimates. However, the same release disclosed that revenue fell short of consensus expectations and that the company was issuing a full-year 2026 outlook that demonstrated a year-over-year decline. The investigation will examine the relative prominence given to each metric in the company's communications.
The company had previously guided investors to expect adjusted EPS of at least $12.65 for 2025, with CFO Craig Safian noting that the guidance was based on 78 million shares and assumed "repurchases to offset dilution." Gartner repurchased more than $1 billion of stock during Q3 2025, reducing share count by 6% year-over-year. The investigation will examine whether the EPS guidance and share-count assumptions were realistic given management's knowledge of revenue trends.
Following the earnings release, Gartner shares declined more than 20% in midday trading, reaching a new 52-week low below $160. Trading volume increased significantly above normal levels.
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