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What were the key takeaways from Forrester Research’s earnings call?

- **AI Access Launch Success**: Secured a multimillion-dollar government deal and a fast-growing pipeline, positioning Forrester as the AI research leader.
- **Financial Resilience**: Despite 8% revenue decline, operating margin improved to 10.5%, driven by cost control and AI Access traction.
- **Client Trust Differentiator**: Proprietary AI model (Izola) and exclusive research assets ensure clients cannot replicate Forrester's insights via public LLMs.
- **Sales Momentum**: Q4 pipeline stability and 27% faster conversion rates suggest improving go-to-market execution.
- **Risk Management**: Downward guidance reflects ongoing consulting and events challenges, but AI Access expected to offset headwinds in 2026.

**【Management Opening Remarks】**
- Edward Morris introduced the call, noting the issuance of the Q3 2025 press release and reminding participants of the forward-looking statements disclaimer. He emphasized the use of adjusted metrics for discussion.

**【CEO Commentary】**
- **Q3 Performance**: Total revenue declined 8% YoY to $94.3M, driven by an 8% drop in consulting and a 6% decline in research. Wallet retention improved to 86%, while client retention remained stable at 74%.
- **Go-to-Market Progress**: Sales process improvements include a 55-day average hiring cycle and adoption of the FAST sales methodology, with all reps now certified. AI Access, launched in September, generated a multimillion-dollar pipeline and secured a landmark government deal.
- **AI Strategy**: AI Access democratizes research access, targeting executives who need trusted insights without direct analyst interaction. The product leverages Izola, a proprietary generative AI model, to provide answers based on Forrester's exclusive research.
- **Client Feedback**: Board of Clients highlighted Forrester's role as a trusted advisor, emphasizing its ability to provide actionable, data-driven insights.

**【CFO Commentary】**
- **Financial Results**: GAAP net income was $7.2M (EPS $0.37), up 30% YoY. Operating expenses decreased 11% due to headcount reduction and cost control, leading to a 21% increase in operating income.
- **Business Segments**: Research revenue declined 4% (excluding FeedbackNow), consulting fell 8%, and events were impacted by timing shifts. The company expects a low single-digit decline in research for 2025.
- **Guidance Update**: Full-year revenue revised to $395M-$405M (down 6%-9% YoY) due to consulting and events challenges. EPS guidance is $1.15-$1.25, reflecting margin stabilization and AI Access momentum.

**【Q&A Highlights】**
- **AI Impact**: Clients prefer Forrester's proprietary data over public LLMs for critical decisions. AI Access is gaining traction in government and international markets, with a focus on enterprise-wide pricing models.
- **Sales Pipeline**: Q4 pipeline is stable, with improved conversion rates (e.g., 27% faster time to close in emerging tech). AI Access is driving winbacks and new logo growth.
- **Partnerships**: The Carahsoft partnership is expanding government access, with early interest in state and federal agencies. International IVD channels remain successful.
- **Conversion Strategy**: The "social contract" methodology holds clients accountable, reducing wasted cycles and improving close rates.


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