GARTNER INC

Previous wording

We operate in a very competitive and rapidly changing environment that involves numerous known and unknown risks and uncertainties, some of which are beyond our control. Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future quarterly and annual revenues, operating income, results of operations and cash flows, as well as any forward-looking statement, are subject to change and to inherent risks and uncertainties, such as those disclosed or incorporated by reference in our filings with the Securities and Exchange Commission. Important factors that could cause our actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in our forward-looking statements include, among others, the following: the impact of general economic conditions, including inflation (and related monetary policy by governments in response to inflation), on economic activity and our operations; changes in macroeconomic and market conditions and market volatility, including interest rates and the effect on the credit markets and access to capital; the impact of global economic and geopolitical conditions, including inflation, and recession; our ability to carry out our strategic initiatives and manage associated costs; our ability to recover potential claims under our event cancellation insurance; the timing of conferences and meetings, in particular our Gartner Symposium/Xpo series that normally occurs during the fourth quarter; our ability to achieve and effectively manage growth, including our ability to integrate our acquisitions and consummate and integrate future acquisitions; our ability to pay our debt obligations; our ability to maintain and expand our products and services; our ability to expand or retain our customer base; our ability to grow or sustain revenue from individual customers; our ability to attract and retain a professional staff of research analysts and consultants as well as experienced sales personnel upon whom we are dependent, especially in light of labor competition; our ability to achieve continued customer renewals and achieve new contract value, backlog and deferred revenue growth in light of competitive pressures; our ability to successfully compete with existing competitors and potential new competitors; our ability to enforce and protect our intellectual property rights; our ability to keep pace with technological developments in artificial intelligence; additional risks associated with international operations, including foreign currency fluctuations; the impact on our business resulting from changes in international conditions, including those resulting from the conflict in the Middle East, the war in Ukraine and current and future sanctions imposed by governments or other authorities; the impact of re…

Excerpt shortened here; the source contains the full paragraph.

Current wording

We operate in a very competitive and rapidly changing environment that involves numerous known and unknown risks and uncertainties, some of which are beyond our control. Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future quarterly and annual revenues, operating income, results of operations and cash flows, as well as any forward-looking statement, are subject to change and to inherent risks and uncertainties, such as those disclosed or incorporated by reference in our filings with the Securities and Exchange Commission. Important factors that could cause our actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in our forward-looking statements include, among others, the following: the impact of general economic conditions, including inflation (and related monetary policy by governments in response to inflation), on economic activity and our operations; changes in macroeconomic and market conditions and market volatility, including interest rates and the effect on the credit markets and access to capital; the impact of global economic and geopolitical conditions, including inflation, and recession; our ability to carry out our strategic initiatives and manage associated costs; the timing of conferences and meetings, in particular our Gartner Symposium/Xpo series that normally occurs during the fourth quarter; our ability to achieve and effectively manage growth, including our ability to integrate our acquisitions and consummate and integrate future acquisitions; our ability to pay our debt obligations; our ability to maintain and expand our products and services; our ability to expand or retain our customer base; our ability to grow or sustain revenue from individual customers; our ability to attract and retain a professional staff of research analysts and consultants as well as experienced sales personnel upon whom we are dependent, especially in light of labor competition; our ability to achieve continued customer renewals and achieve new contract value, backlog and deferred revenue growth in light of competitive pressures; our ability to successfully compete with existing competitors and potential new competitors; our ability to enforce and protect our intellectual property rights; our ability to keep pace with technological developments in artificial intelligence (“AI”) and comply with evolving AI regulations; additional risks associated with international operations, including foreign currency fluctuations; the impact on our business resulting from changes in international conditions, including those resulting from the conflict in the Middle East, the war in Ukraine and current and future sanctions imposed by governments or other authorities; the impact of restructuring and other charges on …

Excerpt shortened here; the source contains the full paragraph.

Previous wording

We are a trusted advisor and an objective resource for close to 15,000 enterprises in approximately 90 countries and territories — across all major functions, in every industry and enterprise size.

Current wording

We are a trusted advisor and an objective resource for close to 14,000 enterprises in approximately 90 countries and territories — across all major functions, in every industry and enterprise size.

Previous wording

We had total revenues of $5.9 billion in 2023, an increase of 8% compared to 2022 on both a reported basis and excluding the foreign currency impact. Net income increased to $882.5 million in 2023 from $807.8 million in 2022 and diluted earnings per share was $11.08 in 2023 compared to $9.96 in 2022.

Current wording

We had total revenues of $6.3 billion in 2024, an increase of 6% compared to 2023 on both a reported basis and excluding the foreign currency impact. Net income increased to $1.3 billion in 2024 from $882.5 million in 2023 and diluted earnings per share was $16.00 in 2024 compared to $11.08 in 2023.

Previous wording

Research revenues increased to $4.9 billion in 2023, an increase of 6% compared to 2022 on both a reported basis and excluding the foreign currency impact. The Research gross contribution margin was 74% in both 2023 and 2022. Contract value was $4.8 billion at December 31, 2023, an increase of 8% compared to December 31, 2022 on a foreign currency neutral basis.

Current wording

Research revenues increased to $5.1 billion in 2024, an increase of 5% compared to 2023 on both a reported basis and excluding the foreign currency impact. The Research gross contribution margin was 74% in both 2024 and 2023. Contract value was $5.3 billion at December 31, 2024, an increase of 8% compared to December 31, 2023 on a foreign currency neutral basis.

Previous wording

Conferences revenues increased to $505.2 million in 2023, an increase of 30% compared to 2022 on a reported basis and 29% excluding the foreign currency impact. The Conferences gross contribution margin was 50% and 54% in 2023 and 2022, respectively. We held 47 in-person conferences in 2023, and 25 in-person and 16 virtual conferences in 2022.

Current wording

Conferences revenues increased to $583.2 million in 2024, an increase of 15% compared to 2023 on both a reported basis and excluding the foreign currency impact. The Conferences gross contribution margin was 48% and 50% in 2024 and 2023, respectively. We held 51 and 47 in-person conferences in 2024 in 2023, respectively.

Previous wording

Consulting revenues increased to $514.7 million in 2023, an increase of 7% compared to 2022 on a reported basis and 8% excluding the foreign currency impact. The Consulting gross contribution margin was 35% and 39% in 2023 and 2022, respectively. Backlog was $162.1 million at December 31, 2023.

Current wording

Consulting revenues increased to $558.5 million in 2024, an increase of 9% compared to 2023 on both a reported basis and excluding the foreign currency impact. The Consulting gross contribution margin was 36% and 35% in 2024 and 2023, respectively. Backlog was $191.5 million at December 31, 2024.

Previous wording

Cash provided by operating activities was $1.2 billion and $1.1 billion during 2023 and 2022, respectively. As of December 31, 2023, we had $1.3 billion of cash and cash equivalents and approximately $1.0 billion of available borrowing capacity on our revolving credit facility. During 2023, we repurchased 1.8 million shares of the Company’s common stock for an aggregate purchase price of approximately $0.6 billion.

Current wording

Cash provided by operating activities was $1.5 billion and $1.2 billion during 2024 and 2023, respectively. As of December 31, 2024, we had $1.9 billion of cash and cash equivalents and approximately $0.7 billion of available borrowing capacity on our revolving credit facility. During 2024, we repurchased 1.6 million shares of the Company’s common stock for an aggregate purchase price of approximately $0.7 billion.

Previous wording

The majority of our Research contracts are billable upon signing, absent special terms granted on a limited basis from time to time. Research contracts are generally non-cancelable and non-refundable, except for government contracts that may have cancellation or fiscal funding clauses. It is our policy to record the amount of a subscription contract that is billable as a fee receivable at the time the contract is signed with a corresponding amount as deferred revenue because the contract represents a legally enforceable claim.

Current wording

The majority of our Research contracts are billable upon signing, absent special terms granted on a limited basis from time to time. Research contracts are generally non-cancelable and non-refundable, except for government contracts that may have cancellation or fiscal funding clauses. Generally, it is our policy to record the amount of a subscription contract that is billable as a fee receivable at the time the contract is signed with a corresponding amount as deferred revenue because the contract represents a legally enforceable claim.

Previous wording

Accounting for income taxes — We use the asset and liability method of accounting for income taxes. We estimate our income taxes in each of the jurisdictions where we operate. This process involves estimating our current tax expense or benefit together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities, which are included in our consolidated balance sheets. When assessing the realizability of deferred tax assets, we consider if it is more likely than not that some or all of the deferred tax assets will not be realized. In making this assessment, we consider the availability of loss carryforwards, projected reversals of deferred tax liabilities, projected future taxable income, and ongoing prudent and feasible tax planning strategies. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained based on the technical merits of the position. Recognized tax positions are measured at the largest amount of benefit with greater than a 50% likelihood of being realized. We use estimates in determining the amount of unrecognized tax benefits associated with uncertain tax positions. Significant judgment is required in evaluating tax law and measuring the benefits likely to be realized. Uncertain tax positions are periodically re-evaluated and adjusted as more information about their ultimate realization becomes available.

Current wording

Accounting for income taxes — We use the asset and liability method of accounting for income taxes. We estimate our income taxes in each of the jurisdictions where we operate. This process involves estimating our current tax expense or benefit together with assessing temporary differences resulting from differing treatment of items for tax and accounting purposes. These differences result in deferred tax assets and liabilities, which are included in our consolidated balance sheets. When assessing the realizability of deferred tax assets, we consider if it is more likely than not that some or all of the deferred tax assets will not be realized. In making this assessment, we consider the availability of loss carryforwards, projected reversals of deferred tax liabilities, projected future taxable income, and ongoing prudent and feasible tax planning strategies. The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained based on the technical merits of the position. Recognized tax positions are measured at the largest amount of benefit with greater than a 50% likelihood of being realized. We use estimates in determining the amount of unrecognized tax benefits associated with uncertain tax positions. Significant judgment is required in evaluating tax law and measuring the benefits likely to be realized. Uncertain tax positions are periodically re-evaluated and adjusted as more information about their ultimate realization becomes available. In December 2024, we completed an intercompany transfer of certain intellectual property (IP). As a result, we recorded a deferred tax asset of approximately $163.2 million, based on the fair value of the IP rights transferred. The deferred tax asset represents the value of future tax deductions for amortization of the assets in the acquiring jurisdiction. The fair value of the intellectual property was determined using an income approach based on unobservable inputs and involves significant judgments such as, but not limited to, future cash flows and discount rates. Management’s estimates of fair value are based upon assumptions believed to be reasonable, but which are inherently uncertain and unpredictable and, as a result, actual results may differ from estimates.

Previous wording

Total revenues for 2023 were $5.9 billion, an increase of $431.1 million compared to 2022, or 8% on both a reported basis and excluding the foreign currency impact. The tables below present (i) revenues by geographic region (based on where the sale is fulfilled) and (ii) revenues by segment for the years indicated (in thousands).

Current wording

Total revenues for 2024 were $6.3 billion, an increase of $360.5 million compared to 2023, or 6% on both a reported basis and excluding the foreign currency impact. The tables below present (i) revenues by geographic region (based on where the sale is fulfilled) and (ii) revenues by segment for the years indicated (in thousands).

Previous wording

Cost of services and product development was $1.9 billion in 2023, an increase of $209.5 million compared to 2022, or 12% on both a reported basis and excluding the foreign currency impact. The increase in Cost of services and product development was primarily due to increased compensation costs as a result of higher headcount, as well as increased conference related expenses, due to the return to in-person destination conferences, partially offset by decreased research program expenses. Cost of services and product development as a percent of revenues was 32% and 31% for 2023 and 2022, respectively.

Current wording

Cost of services and product development was $2.0 billion in 2024, an increase of $119.8 million compared to 2023, or 6% on both a reported basis and excluding the foreign currency impact. The increase in Cost of services and product development was primarily due to a $82.8 million increase in personnel expenses associated with headcount and merit increases as well a $37.0 million increase in conference expenses due to an increase in the number of conferences. Cost of services and product development as a percent of revenues was 32% for both 2024 and 2023.

Previous wording

Selling, general and administrative (“SG&A”) expense was $2.7 billion in 2023, an increase of $220.6 million compared to 2022, or 9% on both a reported basis and excluding the foreign currency impact. The increase in SG&A during the year ended December 31, 2023, as compared to the prior fiscal year, was primarily due to higher personnel costs in the current year, including higher salary expense due to increased headcount. These increases were partially offset by a reduction in facilities expense, related to a reduction of our real estate footprint. We expect to continue to evaluate our real estate footprint globally. If we determine there is any additional excess property, there is no assurance that we will be able to sublease any such excess properties or that we will not incur costs in connection with such exit activities, which may be material. During 2023, we incurred charges associated with the impairment of right-of-use assets and other long-lived assets, related to certain office locations we no longer intend to use, of $20.4 million, compared to $54.0 million in 2022.

Current wording

Selling, general and administrative (“SG&A”) expense was $2.9 billion in 2024, an increase of $183.3 million compared to 2023, or 7% on both a reported basis and excluding the foreign currency impact. The increase in SG&A during the year ended December 31, 2024, as compared to the prior fiscal year, was primarily a result of a $165.4 million increase in personnel expenses due to increased headcount and merit increases.

Previous wording

The number of quota-bearing sales associates in Global Technology Sales increased slightly to 3,641 and in Global Business Sales increased by 8% to 1,188, compared to December 31, 2022. On a combined basis, the total number of quota-bearing sales associates increased by 2% when compared to December 31, 2022. SG&A expense as a percent of revenues was 46% and 45% during 2023 and 2022, respectively.

Current wording

The number of quota-bearing sales associates in Global Technology Sales increased by 4% to 3,804 and in Global Business Sales increased by 9% to 1,298, compared to December 31, 2023. On a combined basis, the total number of quota-bearing sales associates increased by 6% when compared to December 31, 2023. SG&A expense as a percent of revenues was 46% during both 2024 and 2023.

Previous wording

Depreciation increased by 6% during 2023 compared to 2022. The increase for the year ended December 31, 2023 was primarily due to increased computer equipment and software additions in 2022 and 2023, partially offset by a reduction in leasehold improvements depreciation as a result of the impairment losses recorded during 2022 and 2023.

Current wording

Depreciation increased by 14% during 2024 compared to 2023. The increase for the year ended December 31, 2024 was primarily due to increased software additions during the last twelve months.

Previous wording

Amortization of intangibles decreased by 6% during 2023 compared to 2022 primarily due to intangible assets divested as part of the sale of our TalentNeuron business.

Current wording

Amortization of intangibles decreased by 2% during 2024 compared to 2023.

Previous wording

Acquisition and integration charges increased by $0.5 million during the year ended December 31, 2023, compared to the same period in 2022.

Current wording

Acquisition and integration charges decreased by $8.6 million during the year ended December 31, 2024, compared to the same period in 2023.

Previous wording

Gain from sale of divested operation was attributable to the sale of our TalentNeuron business in February 2023. We recognized a pre-tax gain of $135.4 million during the year ended December 31, 2023.

Current wording

Gain from sale of divested operation during the prior year was attributable to the sale of our TalentNeuron business in February 2023. We recognized a pre-tax gain of $135.4 million during the year ended December 31, 2023.

Previous wording

Operating income was $1.2 billion and $1.1 billion during 2023 and 2022, respectively. The increase in operating incomewas primarily due to the gain from sale of divested operation, as well as increased revenue, partially offset by an increase in cost of services and product development and selling, general and administrative expenses.

Current wording

Operating income was $1.16 billion and $1.24 billion during 2024 and 2023, respectively. The 7% decrease in operating incomewas primarily due to the gain from sale of divested operation recognized during the prior year period, and increases in cost of services and product development and selling, general and administrative expenses, partially offset by increased revenue.

Previous wording

Interest expense, net decreased by $27.1 million during 2023 compared to 2022. The decrease in interest expense, net was primarily due to increased interest income, as well as lower interest expense due to the maturation of $700.0 million in fixed-for-floating interest rate swap contracts in March 2022, partially offset by higher interest expense on our term loan.

Current wording

Interest expense, net decreased by $24.8 million during 2024 compared to 2023. The decrease in interest expense, net was due to increased interest income, primarily as a result of higher cash balances than the prior year.

Previous wording

Gain on event cancellation insurance claims of $3.1 million during the year ended December 31, 2023 reflected proceeds related to the 2020 conference cancellation insurance claims.

Current wording

Gain on event cancellation insurance claims of $300.0 million during the year ended December 31, 2024 reflected proceeds from a settlement agreement to resolve litigation concerning the Company's event cancellation insurance for 2020 and 2021. The settlement resolved all remaining 2020 and 2021 event cancellation insurance claims. Gain on event cancellation insurance claims of $3.1 million during the year ended December 31, 2023 reflected proceeds related to 2020 conference cancellation insurance claims.

Previous wording

Other income, net for the years presented herein included the net impact of foreign currency gains and losses from our hedging activities, as well as sales of certain state tax credits and the recognition of other tax incentives. During 2023 and 2022, Other income, net included a $3.9 million and a $52.3 million gain on de-designated interest rate swaps, respectively.

Current wording

Other income, net for the years presented herein included the net impact of foreign currency gains and losses from our hedging activities, as well as sales of certain state tax credits and the recognition of other tax incentives. During both 2024 and 2023, Other income, net included a $3.9 million gain on de-designated interest rate swaps.

Previous wording

Provision for income taxes was $264.7 million and $219.4 million during 2023 and 2022, respectively, with an effective income tax rate of 23.1% and 21.4% for 2023 and 2022, respectively. The increase in the effective income tax rate in 2023 was primarily the result of changes in unrecognized tax benefits year over year. Note 12 — Income Taxes in the Notes to Consolidated Financial Statements provides additional information regarding the Company’s income taxes.

Current wording

Provision for income taxes was $133.7 million and $264.7 million during 2024 and 2023, respectively, with an effective income tax rate of 9.6% and 23.1% for 2024 and 2023, respectively. The decrease in the effective income tax rate in 2024 was primarily the result of net tax benefits of approximately $161.9 million recognized as a result of an intercompany transfer of certain intellectual property in December 2024. Note 12 — Income Taxes in the Notes to Consolidated Financial Statements provides additional information regarding the Company’s income taxes.

Previous wording

Net income was $882.5 million and $807.8 million during 2023 and 2022, respectively. Additionally, our diluted net income per share increased by $1.12 in 2023 compared to 2022. The increase in net income during 2023 was primarily the result of the gain from sale of divested operations, as well as increased revenue and interest income, partially offset by increased operating expenses, a lower gain from de-designated interest rate swaps and higher income tax expense.

Current wording

Net income was $1.3 billion and $882.5 million during 2024 and 2023, respectively. Additionally, our diluted net income per share increased by $4.92 in 2024 compared to 2023. The increase in net income during 2024 was primarily due to the gain on event cancellation insurance claims, as well as an increase in revenue and lower provision for income taxes and interest expense, net, partially offset by the gain from sale of divested operation recognized during the year ended December 31, 2023 and increased operating expenses.

Previous wording

We evaluate reportable segment performance and allocate resources based on gross contribution margin. Gross contribution is defined as operating income or loss excluding certain Cost of services and product development expenses, SG&A expenses,

Current wording

We evaluate reportable segment performance and allocate resources based on gross contribution margin. Gross contribution is defined as operating income or loss excluding certain Cost of services and product development expenses, SG&A expenses, Depreciation, Amortization of intangibles, and Acquisition and integration charges. Gross contribution margin is defined as gross contribution as a percent of revenues.

Previous wording

Research revenues increased by $282.3 million during 2023 compared to 2022, or 6% on both a reported basis and excluding the foreign currency impact. The increase in revenues during 2023 was primarily due to strong Research contract value growth in 2022. The gross contribution margin was 74% in both 2023 and 2022, as the increase in revenue and decreased research program expenses were offset by an increase in personnel expenses to support future growth.

Current wording

Research revenues increased by $238.6 million during 2024 compared to 2023, or 5% on both a reported basis excluding the foreign currency impact. The increase in revenues during 2024 was primarily due to Research contract value growth in 2023. The gross contribution margin was 74% in both 2024 and 2023, as the increase in revenue and decreased research program expenses were offset by an increase in personnel expenses to support future growth.

Previous wording

Contract value increased to $4.8 billion at December 31, 2023, or 8% compared to December 31, 2022 on a foreign currency neutral basis. All industry sectors grew at least high single-digit rates, other than technology and media. The fastest growth was in the public, energy and manufacturing sectors. Global Technology Sales (“GTS”) contract value increased by 6% at December 31, 2023 when compared to December 31, 2022. The increase in GTS contract value was primarily due to new business from existing clients. GTS contract value increased by at least mid single-digits for the majority of enterprise sizes and sectors. Global Business Sales (“GBS”) contract value increased by 13% year-over-year, also primarily driven by new business from existing clients. The majority of our GBS practices achieved double-digit growth rates, with the majority of enterprise sizes and sectors also growing double-digits year-over-year.

Current wording

Contract value increased to $5.3 billion at December 31, 2024, or 8% compared to December 31, 2023 on a foreign currency neutral basis. All industry sectors grew at mid single-digit rates or faster, other than media. The fastest growth was in the manufacturing, healthcare and public sectors. Global Technology Sales (“GTS”) contract value increased by 7% at December 31, 2024 when compared to December 31, 2023. The increase in GTS contract value was primarily due to new business from existing clients. GTS contract value increased by at least mid single-digits for nearly all enterprise sizes and sectors. Global Business Sales (“GBS”) contract value increased by 12% year-over-year, also primarily driven by new business from existing clients. The majority of our GBS practices achieved double-digit growth rates, with all enterprise sizes and the majority of sectors also growing double-digits year-over-year.

Previous wording

GTS client retention was 83% and 86% as of December 31, 2023 and 2022, respectively, while wallet retention was 101% and 105%, as of December 31, 2023 and 2022, respectively. GBS client retention was 87% and 89% as of December 31, 2023 and 2022, respectively, while wallet retention was 107% and 112% as of December 31, 2023 and 2022, respectively. The decrease in GTS and GBS wallet retention was largely due to lower levels of incremental spending by existing clients compared to the same period in 2022.

Current wording

GTS client retention was 84% and 83% as of December 31, 2024 and 2023, respectively, while wallet retention was 102% and 101%, as of December 31, 2024 and 2023, respectively. GBS client retention was 87% as of both December 31, 2024 and 2023, while wallet retention was 106% and 107% as of December 31, 2024 and 2023, respectively.

Previous wording

(2)Includes both virtual and in-person conferences. Single day, local meetings are excluded.

Current wording

(2)Single day, local meetings are excluded.

Previous wording

Conferences revenues increased by $115.9 million during 2023 compared to 2022, or 30% on a reported basis and 29% excluding the foreign currency impact. We re-launched in-person destination conferences during the second quarter of 2022. We held 47 in-person destination conferences during the year ended December 31, 2023. We held 25 in-person conferences and 16 virtual conferences during the year ended December 31, 2022. The increase in revenues for the year ended December 31, 2023 was primarily due the increase in in-person destination conferences. The segment gross contribution margin was 50% and 54% in 2023 and 2022, respectively. The lower gross contribution margin during 2023 was also primarily due to the increase in in-person destination conferences.

Current wording

Conferences revenues increased by $78.1 million during 2024 compared to 2023, or 15% on both a reported basis and excluding the foreign currency impact. We held 51 in-person destination conferences during the year ended December 31, 2024. We held 47 in-person conferences during the year ended December 31, 2023. The increase in revenues for the year ended December 31, 2024 was due to an increase of 15% in both exhibitor revenue and attendee revenue compared to the same period in 2023. The segment gross contribution margin was 48% and 50% in 2024 and 2023, respectively. The lower gross contribution margin during 2024 was primarily the result of an increase in conference-related expenses and increased headcount partially offset by the increase in revenue.

Previous wording

Consulting revenues increased 7% during 2023 compared to 2022 on a reported basis and 8% excluding the foreign currency impact. The increase in revenues on a reported basis was due to a 6% increase in labor-based consulting, and a 10% increase in contract optimization. Contract optimization revenue may vary significantly and, as such, 2023 revenues may not be indicative of future results. The segment gross contribution margin was 35% and 39% in 2023 and 2022, respectively. The decrease in gross contribution margin during 2023 was primarily due to increased personnel expense related to higher headcount, partially offset by the increase in revenue.

Current wording

Consulting revenues increased 9% during 2024 compared to 2023 on both a reported basis and excluding the foreign currency impact. The increase in revenues on a reported basis was due to a 5% increase in labor-based consulting, and a 21% increase in contract optimization. Contract optimization revenue may vary significantly and, as such, 2024 revenues may not be indicative of future results. The segment gross contribution margin was 36% and 35% in 2024 and 2023, respectively. The increase in gross contribution margin during 2024 was primarily due to the increase in revenue.

Previous wording

Backlog increased by $27.6 million, or 21%, from December 31, 2022 to December 31, 2023.

Current wording

Backlog increased by $28.5 million, or 17%, from December 31, 2023 to December 31, 2024.

Previous wording

We finance our operations through cash generated from our operating activities and borrowings. Note 6 — Debt in the Notes to Consolidated Financial Statements provides additional information regarding the Company’s outstanding debt obligations. At December 31, 2023, we had $1.3 billion of cash and cash equivalents and approximately $1.0 billion of available borrowing capacity on the revolving credit facility under our 2020 Credit Agreement. We believe that the Company has adequate liquidity and access to capital markets to meet its currently anticipated needs for both the next twelve months and the foreseeable future.

Current wording

We finance our operations through cash generated from our operating activities and borrowings. Note 6 — Debt in the Notes to Consolidated Financial Statements provides additional information regarding the Company’s outstanding debt obligations. At December 31, 2024, we had $1.9 billion of cash and cash equivalents and approximately $0.7 billion of available borrowing capacity on the revolving credit facility under our 2024 Credit Agreement. We believe that the Company has adequate liquidity and access to capital markets to meet its currently anticipated needs for both the next twelve months and the foreseeable future.

Previous wording

Our cash and cash equivalents are held in numerous locations throughout the world with 55% held overseas at December 31, 2023. The Company intends to reinvest substantially all of its accumulated undistributed foreign earnings, except in instances where repatriation would result in minimal additional tax.

Current wording

Our cash and cash equivalents are held in numerous locations throughout the world with 43% held overseas at December 31, 2024. We intend to distribute a portion of the accumulated undistributed earnings of non-U.S. subsidiaries as of December 31, 2024 in conjunction with global restructuring activity. We continue to assert our intention to reinvest substantially all remaining accumulated undistributed foreign earnings, except in instances where repatriation would result in minimal additional tax.

Previous wording

Cash provided by operating activities was $1.2 billion and $1.1 billion in 2023 and 2022, respectively. The year-over-year increase was primarily due to increased operating income, excluding the gain from sale of divested operation, and strong collections, partially offset by increased income tax payments, in part as a result of the gain from sale of divested operation in 2023.

Current wording

Cash provided by operating activities was $1.5 billion and $1.2 billion in 2024 and 2023, respectively. The year-over-year increase was primarily due to the $300.0 million of insurance proceeds received during 2024 as well as reduced net cash interest expense and increased operating income, excluding the 2023 gain from sale of divested operation.

Previous wording

Cash provided by (used in) investing activities was $54.2 million and $(117.6) million in 2023 and 2022, respectively. The increase from 2022 to 2023 was primarily the result of the proceeds received from the sale of our TalentNeuron business in February 2023.

Current wording

Cash (used in) provided by investing activities was $(103.7) million and $54.2 million in 2024 and 2023, respectively. The decrease from 2023 to 2024 was primarily the result of the $161.1 million in proceeds received from the sale of our TalentNeuron business in February 2023.

Previous wording

Cash used in financing activities was $0.6 billion and $1.0 billion in 2023 and 2022, respectively. During the 2023 period, we used $0.6 billion of cash for share repurchases and paid a net $7.8 million in debt principal repayments. During the 2022 period, we used $1.0 billion for share repurchases and paid a net $5.9 million in debt principal repayments.

Current wording

Cash used in financing activities was $0.7 billion and $0.6 billion in 2024 and 2023, respectively. During the 2024 period, we used $0.7 billion of cash for share repurchases. In March 2024, we borrowed $274.4 million under the 2024 Credit Agreement. The initial borrowing was used to repay the outstanding amounts under the 2020 Credit Agreement. During the 2023 period, we used $0.6 billion for share repurchases and paid a net $7.8 million in debt principal repayments.

Previous wording

(2)The Company leases various facilities, automobiles, computer equipment and other assets under non-cancelable operating lease agreements expiring between 2024 and 2038. The total commitment excludes approximately $207.6 million of estimated future cash receipts from the Company’s subleasing arrangements. Note 1 — Business and Significant Accounting Policies and Note 7 — Leases in the Notes to Consolidated Financial Statements provide additional information regarding the Company’s leases.

Current wording

(2)The Company leases various facilities, automobiles, computer equipment and other assets under non-cancelable operating lease agreements expiring between 2025 and 2038. The total commitment excludes approximately $145.5 million of estimated future cash receipts from the Company’s subleasing arrangements. Note 1 — Business and Significant Accounting Policies and Note 7 — Leases in the Notes to Consolidated Financial Statements provide additional information regarding the Company’s leases.

Previous wording

The FASB has issued accounting standards that had not yet become effective as of December 31, 2023 and may impact the Company’s consolidated financial statements or its disclosures in future periods. Note 1 — Business and Significant Accounting Policies in the Notes to Consolidated Financial Statements provides information regarding those accounting standards.

Current wording

The FASB has issued accounting standards that had not yet become effective as of December 31, 2024 and may impact the Company’s consolidated financial statements or its disclosures in future periods. Note 1 — Business and Significant