UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

þ		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the quarterly period ended September 30, 2005

o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.

For the transition period from           to

Gartner, Inc.

(Exact name of Registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation or organization)		04-3099750 (I.R.S. Employer Identification Number)

P.O. Box 10212 56 Top Gallant Road Stamford, CT (Address of principal executive offices)		06902-7700 (Zip Code)

Registrant’s telephone number, including area code: (203) 316-1111

     Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES þ NO o.

     Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2) YES þ NO o.

     Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES o NO þ.

The number of shares outstanding of the Registrant’s capital stock as of October 31, 2005 was 113,526,190 shares of Common Stock.

 

 

Table Of Contents

		Page
PART I FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS (Unaudited)
Condensed Consolidated Balance Sheets at September 30, 2005 and December 31, 2004			3
Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2005 and 2004			4
Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2005 and 2004			5
Notes to Condensed Consolidated Financial Statements			7
ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS			23
ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK			41
ITEM 4: CONTROLS AND PROCEDURES			42
PART II OTHER INFORMATION
ITEM 1: LEGAL PROCEEDINGS			43
ITEM 5: OTHER INFORMATION			43
ITEM 6: EXHIBITS			44
EX-10.1: TERMINATION OF RESTRICTED STOCK AGREEMENT
EX-10.2: RESTRICTED STOCK AGREEMENT
EX-31.1: CERTIFICATION
EX-31.2: CERTIFICATION
EX-32: CERTIFICATION

PART I FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

GARTNER, INC.

Condensed Consolidated Balance Sheets
(Unaudited, In thousands)

		September 30,				December 31,
		2005				2004
Assets
Current assets:
Cash and cash equivalents		$	80,459			$	160,126
Fees receivable, net			238,744				257,689
Deferred commissions			28,081				32,978
Prepaid expenses and other current assets			53,638				37,052
Total current assets			400,922				487,845
Property, equipment and leasehold improvements, net			56,090				63,495
Goodwill			410,591				231,759
Intangible assets, net			19,249				138
Other assets			74,732				77,957
Total Assets		$	961,584			$	861,194
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable and accrued liabilities		$	229,399			$	181,502
Deferred revenues			330,095				307,696
Current portion of long-term debt			65,000				40,000
Total current liabilities			624,494				529,198
Long-term debt			185,000				150,000
Other liabilities			28,214				51,948
Total Liabilities			837,708				731,146
Stockholders’ Equity
Preferred stock			—				—
Common stock			76				75
Additional paid-in capital			494,374				485,713
Unearned compensation, net			(6,210	)			(7,553	)
Accumulated other comprehensive income, net			7,916				12,722
Accumulated earnings			172,842				190,089
Treasury stock, at cost			(545,122	)			(550,998	)
Total Stockholders’ Equity			123,876				130,048
Total Liabilities and Stockholders’ Equity		$	961,584			$	861,194

See the accompanying notes to the condensed consolidated financial statements.

GARTNER, INC.

Condensed Consolidated Statements of Operations

(Unaudited, in thousands, except per share data)

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2005				2004				2005				2004
Revenues:
Research		$	131,896			$	119,004			$	392,018			$	360,212
Consulting			72,747				60,073				215,849				192,308
Events			17,199				18,675				82,203				74,057
Other			3,469				4,136				9,634				11,835
Total revenues			225,311				201,888				699,704				638,412
Costs and expenses:
Cost of services and product development			112,104				100,196				347,899				310,058
Selling, general and administrative			94,330				85,090				288,603				254,312
Depreciation			6,214				6,589				18,716				21,370
Amortization of intangibles			3,451				203				6,849				590
Goodwill impairments			—				—				—				739
META integration charges			2,046				—				13,619				—
Other charges			5,980				4,333				28,480				23,909
Total costs and expenses			224,125				196,411				704,166				610,978
Operating income (loss)			1,186				5,477				(4,462	)			27,434
Gain (loss) from investments			30				(2,184	)			(5,339	)			(2,145	)
Interest (expense) income, net			(3,120	)			(602	)			(7,783	)			13
Other expense, net			(169	)			(189	)			(2,531	)			(3,625	)
(Loss) income before income taxes			(2,073	)			2,502				(20,115	)			21,677
(Benefit) provision for income taxes			(352	)			2,342				(2,868	)			10,025
Net (loss) income		$	(1,721	)		$	160			$	(17,247	)		$	11,652
(Loss) income per common share:
Basic		$	(0.02	)		$	0.00			$	(0.15	)		$	0.09
Diluted		$	(0.02	)		$	0.00			$	(0.15	)		$	0.09
Weighted average shares outstanding:
Basic			112,542				121,767				111,915				128,044
Diluted			112,542				124,318				111,915				130,923

See the accompanying notes to the condensed consolidated financial statements.

GARTNER, INC.

Condensed Consolidated Statements of Cash Flows
(Unaudited, in thousands)

		Nine Months Ended
		September 30,
		2005				2004
Operating activities:
Net (loss) income		$	(17,247	)		$	11,652
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation and amortization of intangibles			25,565				21,960
Non-cash compensation			661				1,273
Tax benefit associated with employees’ exercise of stock options			983				8,262
Deferred taxes			(5,631	)			409
Loss (gain) from investments			5,339				2,145
Amortization and writeoff of debt issue costs			1,228				744
Charge for stock option buyback			5,980				—
Goodwill impairments			—				739
Non-cash charges associated with impairment of long-lived assets			—				2,943
Changes in assets and liabilities, excluding effect of acquisition and sale of investment:
Fees receivable, net			41,412				49,352
Deferred commissions			4,888				698
Prepaid expenses and other current assets			(9,246	)			(6,215	)
Other assets			3,572				(1,320	)
Deferred revenues			(4,046	)			(14,107	)
Accounts payable and accrued liabilities			(25,858	)			(32,261	)
Cash provided by operating activities			27,600				46,274
Investing activities:
Proceeds from sale of investment			1,300				—
Additions to property, equipment and leasehold improvements			(11,252	)			(19,036	)
Acquisition of META (net of cash acquired)			(161,323	)			—
Other investing activities, net			614				—
Cash used in investing activities			(170,661	)			(19,036	)
Financing activities:
Proceeds from stock issued for stock plans			14,226				56,472
Proceeds from debt issuance			327,000				200,000
Payments for debt issuance costs			(1,082	)			(2,821	)
Payments on debt			(267,958	)			—
Purchases of stock options via tender offer, including costs			(4,532	)			—
Purchases of stock via tender offer, including costs			—				(346,148	)
Purchases of treasury stock			—				(6,114	)

		Nine Months Ended
		September 30,
		2005				2004
Cash provided (used) by financing activities			67,654				(98,611	)
Net (decrease) in cash and cash equivalents			(75,407	)			(71,373	)
Effects of exchange rates on cash and cash equivalents			(4,260	)			(1,948	)
Cash and cash equivalents, beginning of period			160,126				229,962
Cash and cash equivalents, end of period		$	80,459			$	156,641

Supplemental disclosures of non-cash investing and financing activities:

Acquisition of META:

Fair value of assets acquired		$	269,921
Cash paid as of September 30, 2005			(176,423	)
Liabilities assumed		$	93,498

See the accompanying notes to the condensed consolidated financial statements.

GARTNER, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

Note 1 — Basis of Presentation

These interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles (“GAAP”) for interim financial information and with the instructions to Form 10-Q and should be read in conjunction with the consolidated financial statements and related notes of Gartner, Inc. (”Gartner”, or the “Company”) filed in its Annual Report on Form 10-K for the year ended December 31, 2004. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported amounts of operating revenues and expenses. These estimates are based on management’s knowledge and judgments. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of financial position, results of operations and cash flows at the dates and for the periods presented have been included. The results of operations for the three and nine months ended September 30, 2005 may not be indicative of the results of operations for the remainder of 2005. Certain prior year amounts have been reclassified to conform to the current year presentation. The results of operations of META Group, Inc. (“META”) are included in the consolidated financial statements beginning on April 1, 2005, the date of acquisition.

Note 2 — Acquisition of META

On April 1, 2005, the Company completed the acquisition of META for a purchase price of approximately $168.3 million, excluding transaction costs of approximately $8.1 million. Pursuant to the Agreement and Plan of Merger, each share of META common stock outstanding at the effective time of the merger was converted into the right to receive $10.00 in cash. The Company funded the purchase of META with $67.0 million borrowed under its revolving credit facility and existing cash.

META was an information technology and research firm. This acquisition is intended to accelerate revenue growth in Gartner’s core research business by increasing sales coverage through the addition of sales people from META with knowledge of the marketplace and existing client relationships, increasing the Company’s presence in targeted international markets and providing greater coverage in several key industries. The acquisition is also intended to achieve cost synergies in general and administrative expenses.

The acquisition was accounted for as a purchase business combination. The consolidated financial statements include the results of META from the date of acquisition. The purchase price was allocated to the net assets and liabilities acquired based on their estimated fair values as of the acquisition date, based on a third party valuation. Any excess of the purchase price over the estimated fair value of the net assets acquired, including identifiable intangible assets, was allocated to goodwill. A final determination of the purchase price allocation will be made within one year of the acquisition date for changes in estimates, including the completion of integration plans.

The following table represents the preliminary allocation of the purchase price to assets acquired and liabilities assumed (dollars in thousands):

Assets
Current assets:
Cash and cash equivalents		$	15,144
Fees receivable, net			31,729
Prepaid expenses and other current assets			644
Total current assets			47,517
Property, equipment, and leasehold improvements, net			1,353
Goodwill			185,252
Intangible assets:
Content			14,400
Customer relationships			7,700
Databases			3,500
Total intangible assets			25,600
Other assets			10,199
Total assets		$	269,921
Liabilities
Current liabilities:
Accounts payable and accrued liabilities		$	55,318
Deferred revenues			37,088
Notes payable			958
Total current liabilities			93,364
Other liabilities			134
Total liabilities		$	93,498

At September 30, 2005, $158.0 million, $21.2 million, and $6.0 million of goodwill was recorded in the Research, Consulting, and Events segments, respectively, as a result of the META acquisition. Of the total $185.2 million recorded in goodwill related to META at September 30, 2005, none is expected to be deductible for income tax purposes. During the third quarter of 2005, the Company reduced recorded goodwill from the META acquisition by approximately $2.2 million, to $185.2 million from $187.4 million at June 30, 2005. The reduction was primarily related to the recording of an additional $1.6 million of META deferred tax assets and a reduction in deferred revenues of $0.6 million. During the third quarter of 2005, the Company paid an additional $1.5 million of cash related to the purchase of the remaining outstanding META stock options. As of September 30, 2005, the Company may still record changes to the purchase price allocation related to deferred revenues and the recording of liabilities related to META integration activities under Emerging Issues Task Force Issue 95-3 (see the table below).

Intangible assets recorded on the META acquisition are being amortized on a straight-line basis over their estimated remaining lives. Customer relationships are amortized over five years. Content represents research that is part of the intellectual property of META and is amortized over 18 months. META databases are used to generate consulting services to specific customers and are amortized over 18 months.

The preliminary purchase price allocation includes an estimate of the fair value of the cost to fulfill the deferred revenue obligation assumed from META. The estimated fair value of the deferred revenue obligation was determined by estimating the costs to provide the services plus a normal profit margin, and did not include any costs associated with selling efforts. As a result, in allocating the purchase price, the Company recorded an adjustment to reduce the carrying value of META’s March 31, 2005 deferred revenue balance by approximately $10.0 million.

In connection with the META acquisition, the Company commenced integration activities that resulted in the recording of liabilities in purchase accounting under Emerging Issues Task Force Issue 95-3, “Recognition of Liabilities in Connection with a Purchase Combination” (“EITF 95-3”), for involuntary terminations and lease and contract terminations. The liability for involuntary termination benefits covers 276 employees and through September 30, 2005, approximately 262 of these employees have been terminated. The Company expects to pay the majority of the remaining balance for META severance and benefits by December 31, 2005. The majority of the liabilities for contract terminations and exit costs should be paid by March 31, 2006, while the lease liabilities will be paid over their respective contract periods through 2012.

The following table summarizes the initial obligations recorded and activity through September 30, 2005 (dollars in thousands) under EITF 95-3:

		Opening
		Balance																Currency				Balance
		April 1,				Additional												Translation				September 30,
		2005				Accruals (1)				Adjustments (2)				Payments				Adjustments				2005
Lease terminations		$	15,383			$	—			$	—			$	(2,955	)		$	(169	)		$	12,259
Severance and benefits			11,251				740				(206	)			(9,168	)			(466	)			2,151
Contract terminations			3,008				1,358				(891	)			(3,165	)			—				310
Costs to exit activities			1,415				—				(143	)			(257	)			—				1,015
Tax contingencies			—				449				—				—				—				449
		$	31,057			$	2,547			$	(1,240	)		$	(15,545	)		$	(635	)		$	16,184

The following table summarizes the unaudited pro forma financial information for the acquisition and the related financing as if the transaction had been consummated on January 1, 2005 and 2004 under the purchase method of accounting (dollars in thousands, except per share amounts):

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2005				2004				2005				2004
Revenues		$	225.3			$	236.0			$	732.9			$	742.3
Net (loss) income			(1.7	)			(1.5	)			(21.1	)			3.4
(Loss) income per common share:
Basic		$	(0.02	)		$	(0.01	)		$	(0.19	)		$	0.03
Diluted		$	(0.02	)		$	(0.01	)		$	(0.19	)		$	0.03

The unaudited pro forma combined financial information does not necessarily represent what would have occurred if the acquisition had taken place on the dates presented and is not representative of the Company’s future consolidated results. The future combined Company results will not reflect the historical combined Company results of both entities. Future research revenues are expected to be lower on a combined Company basis as a result of expected customer overlap, and future consulting revenues are expected to be lower on a combined Company basis as a result of exiting certain practices. In addition, the future general and administrative expenses are expected to be lower on a combined company basis as a result of the expected cost synergies. The net financial impact of these matters has not been reflected in the pro forma information. Achievement of any of the expected cost savings and synergies is subject to risks and uncertainties and no assurance can be given that such cost savings or synergies will be achieved.

The pro forma information does not include all liabilities that may result from the operation of META’s business in conjunction with that of Gartner’s following the acquisition and all adjustments in respect of possible settlements of outstanding liabilities (other than those already included in the historical financial statements of either company), as these are not presently estimable. Therefore, the actual amounts ultimately recorded may differ materially from the information presented in the accompanying pro forma information.

The Company will recognize revenue associated with the fulfillment of the acquired META contracts, consistent with Gartner’s standard revenue recognition methodology, ratably over the contract term, which is typically twelve months, or upon the completion of the related event. All direct costs associated with the fulfillment of the acquired META contracts will be expensed over the period in which the related revenues are recognized. The pro forma information reflects Gartner’s current estimate of the costs required to fulfill the deferred obligation related to the acquired META contracts.

Note 3 — Comprehensive (Loss) Income

The components of comprehensive (loss) income for the three and nine months ended September 30, 2005 and 2004 are as follows (in thousands):

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2005				2004				2005				2004
Net (loss) income		$	(1,721	)		$	160			$	(17,247	)		$	11,652
Other comprehensive (loss) income:
Foreign currency translation adjustments			328				858				(4,463	)			(916	)
Reclassification adjustment of foreign currency translation adjustment to net income upon closing of foreign operations			—				—				—				2,943
Net unrealized (losses) gains on investments, net of tax			(102	)			3				(343	)			28
Other comprehensive (loss) income			226				861				(4,806	)			2,055
Comprehensive (loss) income		$	(1,495	)		$	1,021			$	(22,053	)		$	13,707

During the first quarter of 2004, the Company reclassified $2.9 million of accumulated translation adjustments associated with certain operations in South America into net income as a result of the Company’s decision to close those operations. The reclassification adjustment was recorded as a loss within Other expense, net.

Note 4 — Computations of (Loss) Income per Share of Common Stock

The following table sets forth the reconciliation of the basic and diluted (loss) income per share (in thousands, except per share data):

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2005				2004				2005				2004
Numerator:
Net (loss) income used for calculating basic and diluted (loss) income per share		$	(1,721	)		$	160			$	(17,247	)		$	11,652
Denominator:
Weighted average number of common shares used in the calculation of basic (loss) income per share			112,542				121,767				111,915				128,044
Common stock equivalents associated with stock compensation plans			—				2,551				—				2,879
Shares used in the calculation of diluted (loss) income per share			112,542				124,318				111,915				130,923
Basic (loss) income per share		$	(0.02	)		$	0.00			$	(0.15	)		$	0.09
Diluted (loss) income per share		$	(0.02	)		$	0.00			$	(0.15	)		$	0.09

For the three months and nine months ended September 30, 2005, options to purchase Common Stock of the Company were not included in the computation of diluted (loss) per share because the effect would have been anti-dilutive. For the three months and nine months ended September 30, 2004, there were 13.0 million and 11.9 million options, respectively, that were not included in the computation of diluted income per share because the effect would have been anti-dilutive.

Note 5 — Accounting for Stock-Based Compensation

The Company has several stock-based compensation plans. The Company applies APB Opinion No. 25 “Accounting for Stock Issued to Employees” (“APB 25”) in accounting for its employee stock options and purchase rights and applies Statement of Financial Accounting Standards No. 123 “Accounting for Stock Issued to Employees” (“SFAS 123”) for disclosure purposes only. Under APB 25, the intrinsic value method is used to account for stock-based employee compensation plans. The SFAS 123 disclosures include pro forma net (loss) income and (loss) income per share as if the fair value-based method of accounting had been used.

If compensation for employee options had been determined based on SFAS 123, the Company’s pro forma net (loss) income, and pro forma (loss) income per share would have been as follows (in thousands, except per share data):

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2005				2004				2005				2004
Net (loss) income as reported		$	(1,721	)		$	160			$	(17,247	)		$	11,652
Add: Stock-based compensation expense, net of tax, included in net (loss) income as reported			125				48				464				827
Deduct: Pro forma employee compensation cost, net of tax, related to stock options, restricted stock, and share purchase plan			(29,483	)			(3,809	)			(37,050	)			(9,596	)
Pro forma net (loss) income		$	(31,079	)		$	(3,601	)		$	(53,833	)		$	2,883
Basic (loss) income per share:
As reported		$	(0.02	)		$	0.00			$	(0.15	)		$	0.09
Pro forma		$	(0.28	)		$	(0.03	)		$	(0.48	)		$	0.02
Diluted (loss) income per share:
As reported		$	(0.02	)		$	(0.00	)		$	(0.15	)		$	0.09
Pro forma		$	(0.28	)		$	(0.03	)		$	(0.48	)		$	0.02

During the third quarter of 2005, the Company completed its offer to buy back certain vested and outstanding employee stock options for cash (See Note 12 — Equity and Stock Programs for additional information). As a result of the buy back, the pro forma employee compensation cost included in the table above includes approximately $26.2 million of pro forma expense in both the three months ended and nine months ended periods of 2005. The expense results from the reversal of pro forma deferred tax assets that had been established in prior periods which will not be realized for pro forma purposes because the options were tendered and cancelled. The pro forma expense had no impact on the Company’s reported tax expense, recorded deferred tax assets, or actual cash income tax payments.

The fair value of the Company’s stock plans was estimated on the date of grant using the Black-Scholes option-pricing model with the following weighted-average assumptions:

		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2005				2004				2005				2004
Expected Dividend yield			0	%			0	%			0	%			0	%
Expected stock price volatility			28	%			43	%			31	%			40	%
Risk-free interest rate			4.0	%			2.2	%			3.7	%			3.0	%
Expected life in years			3.1				4.0				3.1				3.8

The weighted average fair values of the Company’s stock options granted during the three months ended September 30, 2005 and 2004 were $2.62 and $3.88, respectively. The weighted average fair values of the Company’s stock options granted during the nine months ended September 30, 2005 and 2004 were $2.73 and $4.20, respectively.

In December 2004 the Financial Accounting Standards Board issued Statement of Financial Accounting Standards 123R, “Share-Based Payment” (SFAS 123R). This statement replaces SFAS 123 and APB 25 and will require the recognition of expense for share-based payments, to include the value of stock options and other equity awards granted to employees. The revised statement was originally effective for periods beginning after June 15, 2005, with early adoption permitted.

On April 21, 2005 the SEC issued a standard that amends the date of compliance with SFAS 123R (“the SEC amendment”). Under the SEC amendment, SFAS 123R must be adopted beginning with the first interim or annual reporting period of the registrant’s first fiscal year beginning on or after June 15, 2005. Gartner is planning to adopt SFAS 123R on January 1, 2006.

We are currently assessing the impact SFAS 123R will have on our financial position, cash flows, and results of operations. Projecting the amount of future stock compensation expense is inherently difficult due to the uncertainty of a number of factors, among them the level of volatility of our common stock. Currently we disclose the pro forma impact of stock compensation as required by SFAS 123, and for the nine months ended September 30, 2005, our net income would have been reduced by approximately $11.0 million (excluding the effect of the third quarter 2005 one-time option buy back) if stock compensation expense had been included in our results of operations. Accordingly, we believe the adoption of SFAS 123R will have a materially negative impact on our results of operations.

Note 6 — Segment Information

The Company manages its business in three reportable segments: Research, Consulting, and Events. Research consists primarily of subscription-based research products, access to research inquiry, as well as peer networking services and membership programs. Consulting consists primarily of consulting, measurement engagements, and strategic advisory services. Events consists of various symposia, conferences, and exhibitions.

The Company evaluates reportable segment performance and allocates resources based on gross contribution margin. Gross contribution, as presented below, is defined as operating income, excluding certain selling, general and administrative expenses, depreciation, amortization, goodwill impairment, income taxes, META integration charges, and other charges. The accounting policies used by the reportable segments are the same as those used by the Company.

The Company does not identify or allocate assets, including capital expenditures, by operating segment. Accordingly, assets are not reported by segment because the information is not available and is not reviewed in the evaluation of segment performance or in making decisions in the allocation of resources.

The following tables present information about reportable segments (in thousands). The “Other” column includes certain revenues and related expenses that do not meet the segment reporting quantitative threshold. There are no inter-segment revenues.

		Research				Consulting				Events				Other				Consolidated
Three Months Ended September 30, 2005:
Revenues		$	131,896			$	72,747			$	17,199			$	3,469			$	225,311
Gross Contribution			78,648				29,834				6,521				3,143				118,146
Corporate and other expenses																			(116,960	)
Operating income																		$	1,186
Three Months Ended September 30, 2004:
Revenues		$	119,004			$	60,073			$	18,675			$	4,136			$	201,888
Gross Contribution			72,050				20,738				6,571				3,753				103,112
Corporate and other expenses																			(97,635	)
Operating income																		$	5,477
Nine Months Ended September 30, 2005:
Revenues		$	392,018			$	215,849			$	82,203			$	9,634			$	699,704
Gross Contribution			236,620				84,568				36,611				8,566				366,365
Corporate and other expenses																			(370,827	)
Operating (loss)																		$	(4,462	)
Nine Months Ended September 30, 2004:
Revenues		$	360,212			$	192,308			$	74,057			$	11,835			$	638,412
Gross Contribution			224,082				70,816				30,537				10,523				335,958
Corporate and other expenses																			(308,524	)
Operating income																		$	27,434

Note 7 — Goodwill and Intangible Assets

During the second quarter of 2005, the Company completed the acquisition of META (See Note 2 - Acquisition of META Group, Inc.). As of September 30, 2005, the Company has recorded total goodwill of $185.2 million and other intangibles of $25.6 million as a result of the META acquisition. The recorded amounts of the goodwill may change as a result of the finalization of the purchase accounting.

The changes in the carrying amount of goodwill, by reporting segment, for the nine months ended September 30, 2005 are as follows:

		Balance				Goodwill				Currency				Balance
		December 31,				From META				Translation				September 30,
		2004				Acquisition				Adjustments				2005
Research		$	131,921			$	158,019			$	(5,103	)		$	284,837
Consulting			67,150				21,231				(1,240	)			87,141
Events			30,606				6,002				(77	)			36,531
Other			2,082				—				—				2,082
Total goodwill		$	231,759			$	185,252			$	(6,420	)		$	410,591

The following table presents the Company’s intangible assets subject to amortization (in thousands):

		Intellectual				Customer
September 30, 2005		Property				Relationships				Databases				Other				Total
Gross cost		$	14,400			$	7,700			$	3,500			$	1,906			$	27,506
Accumulated amortization			(4,803	)			(770	)			(1,168	)			(1,516	)			(8,257	)
Net		$	9,597			$	6,930			$	2,332			$	390			$	19,249

		Intellectual				Customer
December 31, 2005		Property				Relationships				Databases				Other				Total
Gross cost		$	—			$	—			$	—			$	1,555			$	1,555
Accumulated amortization			—				—				—				(1,417	)			(1,417	)
Net		$	—			$	—			$	—			$	138			$	138

The Other category includes noncompete agreements and trademarks. Aggregate amortization expense for the three month periods ended September 30, 2005 and 2004 was $3.5 million and $0.2 million, respectively. Aggregate amortization expense for the nine month periods ended September 30, 2005 and 2004 was $6.8 million and $0.6 million, respectively.

The estimated future amortization expense by year from purchased intangibles is as follows (in thousands):

2005 (remaining three months)		$	3,390
2006			10,573
2007			1,580
2008			1,580
2009			1,580
2010 and thereafter			546
		$	19,249

Note 8 — META Integration Charges

For the three month and nine month periods ended September 30, 2005, the Company incurred approximately $2.0 million and $13.6 million, respectively, of expenses related to the integration of META, primarily for severance, and for consulting, accounting, and tax services. In accordance with SFAS No. 141, “Business Combinations,” these merger integration services were expensed as incurred.

Note 9 — Other Charges

During the third quarter of 2005, the Company recorded other charges of $6.0 million related to its completion of a one time offer to buy back certain vested and outstanding stock options for cash (See Note 12 — Equity and Stock Programs for additional information).

During the second quarter of 2005, the Company recorded other charges of $8.2 million. Included in the second quarter charge was $8.5 million of costs primarily related to the reduction of office space in San Jose, California, by consolidating employees from two buildings into one. The Company also recorded a charge of $0.6 million associated with certain stock combination expenses, which was offset by a reversal of $0.9 million of accrued severance and other charges that the company determined would not be paid.

During the first quarter of 2005, the Company recorded other charges of $14.3 million. Included in the charge was $10.6 million for costs associated with employee termination severance payments and related benefits. The workforce reduction was a continuation of the plan announced in the fourth quarter of 2004 which resulted in the termination of 123 employees during the three months ended March 31, 2005. In addition, the Company also recorded other charges of approximately $3.7 million, primarily related to a restructuring of the Company’s international operations.

During the third quarter of 2004, the Company recorded $4.3 million of other charges, primarily for severance charges related to the departure of the Company’s former President and COO and former CEO, of $3.1 million and $0.8 million, respectively.

During the second quarter of 2004, the Company recorded other charges of $9.1 million, which included $3.8 million of severance costs associated with the departure of the former CEO, as well as $5.3 million of costs associated with a realignment of the Company’s workforce. This workforce realignment resulted in the termination of 30 employees during the second quarter of 2004.

During the first quarter of 2004, the Company recorded other charges of $10.5 million, of which $10.4 million was associated with the realignment of the company’s workforce and $0.1 million was associated with costs to close certain operations in South America. The workforce realignment portion of the charge was for costs for employee termination severance payments and related benefits and included 132 employees.

The following table summarizes the activity related to the liability for restructuring programs recorded in Other charges in the Consolidated Statements of Operations (in thousands):

		Workforce				Excess				Asset
		Reduction				Facilities				Impairments
		Costs				Costs				And Other				Total
Accrued liability at December 31, 2003		$	12,816			$	19,159			$	—			$	31,975
Charges during nine months ended September 30, 2004			23,806				—				103				23,909
Non-cash charges			(496	)			—				(66	)			(562	)
Payments			(25,804	)			(3,922	)			(37	)			(29,763	)
Accrued liability at September 30, 2004			10,322				15,237				—				25,559
Charges during remainder of 2004			5,901				2,263				5,681				13,845
Non-cash charges			—				—				(4,185	)			(4,185	)
Payments			(6,955	)			(325	)			2				(7,278	)
Accrued liability at December 31, 2004			9,268				17,175				1,498				27,941
Charges during nine months ended September 30, 2005			9,935				8,270				10,275				28,480
Currency translation and reclassifications			(365	)			(319	)			(1,031	)			(1,715	)
Payments			(14,837	)			(2,544	)			(8,617	)			(25,998	)
Accrued liability at September 30, 2005		$	4,001			$	22,582			$	2,125			$	28,708

The asset impairments and other charges in the first nine months of 2005 include $6.0 million for the option buy back and $3.7 million related to a restructuring in the Company’s international operations. Of the remaining $2.1 million to be paid at September 30, 2005, approximately $1.4 million was paid out in October 2005 while the Company expects the remaining $0.7 million to be paid by December 31, 2005.

During the second quarter of 2005, the Company reclassified $0.9 million of accrued charges, which were originally recorded in the fourth quarter of 2004, out of the asset impairments and other category into the loss on the sale of a non-core product line. The non-core product line was sold in the second quarter of 2005 and was immaterial.

The majority of the accrued workforce reduction costs of $4.0 million at September 30, 2005 will be paid by December 31, 2005, while the costs related to excess facilities will be paid until 2011. The Company expects to fund these payments from existing cash.

The non-cash charges for workforce reductions during 2004 resulted from the establishment of a new measurement date for certain equity compensation arrangements upon the modification of the terms of the related agreements. The asset impairments and other charge in 2004 were primarily for the exit from certain non-core product lines and asset impairments.

The table above excludes approximately $3.2 million of accrued excess facilities liability at September 30, 2005 related to interest accreted on the lease liabilities. The interest accretion is charged to interest (expense) income, net in the Consolidated Statements of Operations.

Note 10 — Investments

The Company recorded non-cash charges of $5.1 million and $0.3 million during the first and second quarters of 2005, respectively, related to writedowns of its investment in SI Venture Fund II (“SI II”), which the Company had decided to sell in the fourth quarter of 2004. SI II is a limited partnership venture capital fund engaged in making investments in early to mid-stage IT-based or Internet-enabled companies. The Company recorded the writedown in the first quarter of 2005 to reduce the investment to its estimated net realizable value after receiving preliminary indications of interest to acquire the investment for less than its recorded value. The Company took the additional writedown in the second quarter of 2005 based on a preliminary sale agreement for which the proceeds were less than the recorded value. The losses are recorded in Gain (loss) from investments, net in the Consolidated Statements of Operations. On August 2, 2005, the Company sold its investment in SI II for approximately $1.3 million, with no resulting gain or loss recorded on the sale since the investment was already at net realizable value.

During the third quarter of 2004, the Company recorded a non-cash charge of $2.2 million related to the transfer of the Company’s investment in TruSecure to SI II, as well as a decrease in the Company’s ownership percentage in SI II of seven hundred basis points.

Investments in equity securities were $1.1 million and $7.0 million at September 30, 2005 and December 31, 2004, respectively.

Note 11 — Debt

On June 29, 2005, the Company entered into an Amended and Restated Credit Agreement. The Amended and Restated Credit Agreement provides for a five year, $200.0 million term loan and a $125.0 million revolving credit facility which may be increased up to $175.0 million.

The term loan will be repaid in 19 quarterly installments, with the final payment due on June 29, 2010. The revolving credit facility may be used for loans, and up to $10.0 million may be used for letters of credit. The revolving loans may be borrowed, repaid and reborrowed until June 29, 2010, at which time all amounts borrowed must be repaid. The loans bear interest, at the Company’s option, at a rate equal to the greatest of the Administrative Agent’s prime rate, the Administrative Agent’s rate for three-month certificates of deposit (adjusted for statutory reserves) and the average rate on overnight federal funds plus ½ of 1% plus a spread equal to between 0.00% and 0.75% depending on the Company’s leverage ratio as of the fiscal quarter most recently ended, or at the Eurodollar rate (adjusted for statutory reserves) plus a spread equal to between 1.00% and 1.75%, depending on the Company’s leverage ratio as of the fiscal quarter most recently ended.

The Amended and Restated Credit Agreement contains certain restrictive loan covenants, including, among others, financial covenants requiring a maximum leverage ratio, a minimum fixed charge coverage ratio, and a minimum annualized contract value ratio and covenants limiting Gartner’s ability to incur indebtedness, grant liens, make acquisitions, be acquired, dispose of assets, pay dividends, repurchase stock, make capital expenditures and make investments. Gartner’s obligations under the credit facility are guaranteed by Gartner’s U.S. subsidiaries.

The Amended and Restated Credit Agreement contains events of default that include, among others, non-payment of principal, interest or fees, inaccuracy of representations and warranties, violation of covenants, cross defaults to certain other indebtedness, bankruptcy and insolvency events, material judgments, and events constituting a change of control. The occurrence of an event of default will increase the applicable rate of interest by 2.0% and could result in the acceleration of Gartner’s obligations under the credit facility and an obligation of any or all of the guarantors to pay the full amount of Gartner’s obligations under the credit facility.

The Amended and Restated Credit Agreement replaces the prior credit facility, as amended on March 5, 2005, and changes certain terms, including, among other things, modifying the definition of Consolidated EBITDA to allow Gartner to add back the amounts of certain charges related to its acquisition and integration of META to the calculation of Consolidated EBITDA.

In connection with the purchase of META, on April 1, 2005, the Company borrowed $67.0 million under the revolving credit facility, and then borrowed an additional $10.0 million under the revolver in early May 2005 which was used to make the scheduled quarterly payment on the term A loan facility.

On June 29, 2005, the Company repaid approximately $247.0 million outstanding under its existing Credit Agreement and received $250.0 million in cash under the Amended and Restated Credit Agreement consisting of a $200.0 million term loan and a $50.0 million draw on the revolving credit facility. In connection with the refinancing, in the second quarter of 2005 the Company expensed approximately $0.5 million of deferred debt issue costs.

In the third quarter of 2005, the Company borrowed and repaid an additional $10.0 million under the revolving credit facility, which is shown net in the Consolidated Statements of Cash Flows. At September 30, 2005, the Company had $4.8 million of letters of credit outstanding under the revolving credit facility. The weighted-average interest rate on the revolving credit facility was 5.0% in the third quarter of 2005.

On September 30, 2005, there was $200.0 million outstanding on the term loan and $50.0 million outstanding on the revolving credit facility, and the Company had approximately $70.1 million of remaining capacity under the credit facility. As of September 30, 2005, the interest rates on the term loan and revolver were 5.53% and 5.35%, respectively.

Note 12 — Equity and Stock Programs

Stock Option Buy Back

During the third quarter of 2005, the Company completed its one-time offer to buy back certain vested and outstanding stock options for cash, which resulted in the tender and cancellation of 6,383,445 options. In conjunction with the buyback, the Company recorded a charge of approximately $6.0 million, including transaction and related costs. The charge is recorded in Other charges, net in the Consolidated Statements of Operations.

Under the offer, option holders were given the opportunity to elect to tender their eligible options in exchange for a cash payment equal to the value of the outstanding options, as calculated based on the Black-Scholes valuation model. The offer was made to all current and former employees, except current executive officers and directors, who held options to purchase our common stock with a strike price greater than $12.95.

The accounting for the buyback is governed by APB 25. Under APB 25, the cash consideration paid for redeemed stock options is treated as compensation expense, which is a charge to earnings. In addition to the expense, APB 25 also requires that those outstanding options which the Company offered to redeem and which were not tendered are subject to variable accounting treatment from the day of the offer onward, requiring the Company to take a potential charge each quarter to the extent the in-the-money value of those options increased as measured on the last day of the quarter. Additionally, to the extent the Company issues new option grants to those employees whose options it redeemed within six months from the closing of the offer, those option grants will be subject to variable accounting. The Company recorded a charge in the third quarter of 2005 of approximately $11,000 related to the revaluation of these options. Any variable accounting treatment triggered by the proposed offer will cease upon adoption of SFAS 123R, which the Company expects to adopt on January 1, 2006.

Replacement Restricted Stock Award

On November 9, 2005, Gartner and Eugene A. Hall, its chief executive officer, agreed to cancel Mr. Hall’s existing 500,000 share restricted stock award and replace it with a new award for the same amount of shares and on similar terms. This was done for tax reasons and the number of shares of restricted stock issued to Mr. Hall remains unchanged. By issuing the restricted sock award under its stockholder approved 2003 Long Term Incentive Plan, Gartner will be able to take a tax deduction when and if the restrictions lapse on the restricted stock award. Gartner would not have been able to take advantage of this tax deduction on the award in its current form because the award had been made as an inducement grant, and consequently was not issued pursuant to a stockholder approved plan. Gartner and Mr. Hall have entered into (i) a Termination of Restricted Stock Agreement to cancel the original award of 500,000 shares of restricted stock which was made on October 15, 2004; and (ii) a Restricted Stock Agreement which makes a new grant to him of 500,000 shares of restricted stock under Gartner’s 2003 Long Term Incentive Plan.

Similarly to the grant being cancelled, the restrictions on this new grant lapse as to (i) 300,000 shares when the Company’s Common Stock trades at an average price of $20 or more for sixty (60) consecutive trading days, (ii) 100,000 shares when the Company’s Common Stock trades at an average price of $25 or

more for sixty (60) consecutive trading days, and (iii) 100,000 shares when the Company’s common stock trades at an average price of $30 or more for sixty (60) consecutive trading days, subject to Mr. Hall’s continued employment with the Company through each such date. Notwithstanding the preceding sentence, all restrictions shall lapse in full upon a change in control.

The replacement award had no impact on the Company’s financial position, cash flows, or results of operations.

Stock Combination

At the Company’s Annual Meeting on June 29, 2005, Gartner’s stockholders approved the combination of the Company’s Class A Common Stock and Class B Common Stock into a single class of common stock and the elimination of the classification of Gartner’s Board of Directors. Each share of outstanding Class A Common Stock and Class B Common Stock was reclassified into a share of a single class of common stock. The combination had no impact on the total issued and outstanding shares of common stock and did not increase the total number of authorized shares of common stock. A Restated Certificate of Incorporation was filed with the Delaware Secretary of State on July 6, 2005 to effectuate these changes. The new common stock retains the Class A Common Stock’s ticker symbol on the New York Stock Exchange (IT) and the Class B Common Stock was delisted from the New York Stock Exchange after the effective date.

Long Term Incentive Plan

At the Company’s Annual Meeting on June 29, 2005, Gartner’s stockholders approved certain amendments to Gartner’s 2003 Long Term Incentive Plan (“the Plan”), including an increase in the number of shares available under the Plan by an additional 11 million shares, the addition of restricted stock units as an award available for grant under the Plan, and the extension of the term of the Plan until April 19, 2015, unless sooner terminated by the Company’s Board of Directors.

Tender Offer

On August 10, 2004, the Company completed a Dutch auction tender offer in which it repurchased 11.3 million shares of its Class A Common Stock and 5.5 million shares of its Class B Common Stock at a purchase price of $13.30 and $12.50 per share, respectively. Additionally, the Company repurchased 9.2 million Class A shares from Silver Lake Partners, L.P. and certain of its affiliates at a purchase price of $13.30 per share. The total cost of the repurchases was $346.2 million, including transaction costs of $3.8 million.

Terminated $200 Million Share Repurchase Program

In July 2001, the Company’s Board of Directors approved the repurchase of up to $75.0 million of Class A and Class B Common Stock. The Board of Directors subsequently increased the authorized stock repurchase program to a total authorization for repurchase of $200.0 million. During the first quarter of 2004, the Company repurchased 292,925 shares of its Class A Common Stock and 57,900 shares of its Class B Common Stock at an aggregate cost of $4.0 million. In connection with the Dutch auction tender offer, the Board of Directors terminated the stock repurchase program in June 2004. On a cumulative basis the Company repurchased $133.2 million of its stock under this program.

Note 13 — Income Taxes

The provision (benefit) for income taxes for the third quarter of 2005 and 2004 was 17% and 94% of (loss) income before income taxes, respectively. For the first nine months of 2005 and 2004, the respective provision (benefit) for income taxes was 14% and 46% of (loss) income before income taxes. Excluding certain one-time charges, the provision for income taxes for quarter to date and year to date September 2005 was 31% and 33% of pre-tax book income respectively. Excluding certain one-time charges, the provision for income taxes for both quarter to date and year to date September 2004 was 33% of pre-tax book income. In 2005, the most significant of these charges include expenses related to the acquisition and integration of META which are not deductible for tax purposes, and capital losses on the sale of SI II for which the Company established a full valuation allowance. In 2004, the most significant of these charges included nondeductible goodwill impairment, the non-deductible write-off of accumulated foreign currency translation adjustments associated with certain South American operations, and certain severance charges.

The Internal Revenue Service (“IRS”) has completed the field work portion of an audit of the Company’s federal income tax returns for tax years ended September 30, 1999, through 2002. In October 2005, the Company received an Examination Report showing proposed changes that primarily relate to the valuation of intangible assets licensed to a foreign subsidiary and the calculation of payments under a cost sharing arrangement between Gartner Inc. and one of its foreign subsidiaries. The Company disagrees with the proposed adjustments relating to valuation and cost sharing and intends to vigorously dispute this matter through applicable IRS and judicial procedures, as appropriate. However, if the IRS were to ultimately prevail on the valuation and cost sharing arrangements, it could result in additional taxable income for the years under examination of approximately $130.7 million and an additional federal cash tax liability of approximately $41.0 million. The Company recorded a provision in prior periods based on our estimate of the amount the claim will be settled, and no additional amount was booked in the current period. Although the final resolution of the proposed adjustments is uncertain, we believe the ultimate disposition of this matter will not have a material adverse effect on our consolidated financial position, cash flows, or results of operations, but it could have an impact in the period in which it is resolved.

In March of 2005, the Company repatriated approximately $52.0 million in earnings from its non-US subsidiaries. The repatriation was expected to qualify for a one-time reduced tax rate pursuant to the American Jobs Creation Act (AJCA). To date, the Company has recorded net deferred tax charges of $1.4 million for the tax impact of the repatriation as calculated under the AJCA.

Note 14 — Defined Benefit Pension Plan

The Company has a defined-benefit pension plan in one of its international locations. The plan is statutory in nature, covers 81 individuals, and is accounted for in accordance with the requirements of Statement of Financial Accounting Standards No. 87, — “Employers’ Accounting for Pensions” (“SFAS 87”). Benefits paid under the plan are based on years of service and employee compensation, and employees vest under the plan after five years of service. Benefits are paid under the plan through a reinsurance contract, which the Company maintains with a third-party insurance company. The Company pays an annual insurance premium for this coverage. In accordance with the requirements of SFAS 87, the reinsurance contract does not qualify as a plan asset since it is maintained outside of the plan.

Net periodic pension expense was $0.5 million and $0.4 million for the three month periods ended September 30, 2005 and 2004, respectively. Net periodic pension expense for the nine month periods ended September 30, 2005 and 2004 was $1.4 million and $1.0 million, respectively.

Note 15 — Contingencies

The Company is involved in legal proceedings and litigation arising in the ordinary course of business. The Company believes the outcome of all current proceedings, claims and litigation will not have a material effect on its financial position or results of operations when resolved in a future period. For additional information related to tax contingencies, see Footnote 13 — Income Taxes.

The Company has various agreements in which it may be obligated to indemnify the other party with respect to certain matters. Generally, these indemnification clauses are included in contracts arising in the normal course of business under which the Company customarily agrees to hold the other party harmless against losses arising from a breach of representations related to such matters as title to assets sold and licensed or certain intellectual property rights. It is not possible to predict the maximum potential amount of future payments under these indemnification agreements due to the conditional nature of obligations and the unique facts of each particular agreement. Historically, payments made by the Company under these agreements have not been material. As of September 30, 2005, the Company is not aware of any indemnification agreements that would require material payments.

Note 16 — Subsequent Event

In October 2005, the Company’s Board of Directors authorized a $100.0 million common share repurchase program. Repurchases under the program will be made from time-to-time through open market purchases and/or block trades. The Company intends to fund the repurchases from cash flow from operations but may also borrow under the Company’s existing credit facility. The authorization had no impact on the Company’s financial position, cash flows, results of operations, or shares outstanding as of and for the period ending September 30, 2005.

ITEM 2. MANAGEMENT’S DISCUSSION OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The purpose of the following Management’s Discussion and Analysis (MD&A) is to help facilitate the understanding of significant factors influencing the operating results, financial condition and cash flows of Gartner, Inc. Additionally, the MD&A also conveys our expectations of the potential impact of known trends, events or uncertainties that may impact future results. You should read this discussion in conjunction with our condensed consolidated financial statements and related notes included in this report and in our Annual Report on Form 10-K for the year ended December 31, 2004. Historical results and percentage relationships are not necessarily indicative of operating results for future periods.

References to “the Company,” “we,” “our,” and “us” are to Gartner, Inc. and its subsidiaries.

In addition to historical information, this Quarterly Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are any statements other than statements of historical fact, including statements regarding our expectations, beliefs, hopes, intentions or strategies regarding the future. In some cases, forward-looking statements can be identified by the use of words such as “may,” “will,” “expects,” “should,” “believes,” “plans,” “anticipates,” “estimates,” “predicts,” “potential,” “continue,” or other words of similar meaning. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those discussed in, or implied by, the forward-looking statements. Factors that might cause such a difference include, but are not limited to, those discussed in “Factors That May Affect Future Performance” and elsewhere in this report and in our Annual Report on Form 10-K for the year ended December 31, 2004. Readers should not place undue reliance on these forward-looking statements, which reflect management’s opinion only as of the date on which they were made. Except as required by law, we disclaim any obligation to review or update these forward-looking statements to reflect events or circumstances as they occur. Readers also should review carefully any risk factors described in other reports filed by us with the Securities and Exchange Commission.

OVERVIEW

With the convergence of IT and business, technology has become increasingly more important — not just to technology professionals, but also to business executives. We are an independent and objective research and advisory firm that helps IT and business executives use technology to build, guide and grow their enterprises. We deliver this insight through our entire product portfolio.

We employ a diversified business model that leverages the breadth and depth of our research intellectual capital while enabling us to maintain and grow our market-leading position and brand franchise. Our strategy is to align our resources and our infrastructure to leverage that intellectual capital into additional revenue streams through effective packaging, campaigning and cross-selling of our products and services. Our diversified business model provides multiple entry points and synergies that facilitate increased client spending on our research, consulting and events. A key strategy is to increase business volume with our most valuable clients, identifying relationships with the greatest sales potential and expanding those relationships by offering strategically relevant research and analysis.

We intend to maintain a balance between (1) pursuing opportunities and applying resources with a strict focus on growing our three core businesses and (2) generating profitability through a streamlined cost structure.

We have three business segments: research, consulting and events.

• Research provides insight for CIOs, IT professionals, technology providers and the investment community through reports and analyst briefings, access to our industry-leading analysts, as well as peer networking services and membership programs designed specifically for CIOs and other senior executives.

• Consulting consists primarily of consulting, measurement engagements and strategic advisory services (paid one-day analyst engagements) (“SAS”), which provide assessments of strategy, cost, performance, efficiency and quality focused on the IT industry.

• Events consists of various symposia, conferences and exhibitions focused on the IT industry.

We believe the following business measurements are important performance indicators for our business segments:

BUSINESS
SEGMENTS		BUSINESS MEASUREMENTS
Research		Contract value represents the value attributable to all of our
		subscription-related research products that recognize revenue on a ratable
		basis. Contract value is calculated as the annualized value of all subscription
		research contracts in effect at a specific point in time, without regard to the
		duration of the contract.
		Client retention rate represents a measure of client satisfaction and renewed
		business relationships at a specific point in time. Client retention is
		calculated on a percentage basis by dividing our current clients, who were also
		clients a year ago, by all clients from a year ago.
		Wallet retention rate represents a measure of the amount of contract value we
		have retained with clients over a twelve-month period. Wallet retention is
		calculated on a percentage basis by dividing the contract value of clients, who
		were clients one year earlier, by the total contract value from a year earlier.
		When wallet retention exceeds client retention, it is an indication of
		retention of higher-spending clients, or increased spending by retained
		clients, or both.
		Number of executive program members represents the number of paid participants
		in our executive programs.
Consulting		Consulting backlog represents future revenue to be derived from consulting,
		measurement and strategic advisory services engagements.
		Utilization rates represent a measure of productivity of our consultants.
		Utilization rates are calculated for billable headcount on a percentage basis
		by dividing total hours billed by total hours available to bill.
		Billing Rate represents earned billable revenue divided by total billable hours.
Events		Number of events represents the total number of hosted events completed during
		the period.
		Number of attendees represents the number of people who attend events.

EXECUTIVE SUMMARY OF OPERATIONS AND FINANCIAL POSITION

On April 1, 2005, we completed the purchase of META in an all-cash transaction for $10.00 per share, for a total purchase price of approximately $168.3 million, excluding transaction costs. Accordingly, the discussions of operating results and business measurements included herein include the impact of META beginning April 1, 2005.

In October 2005, the Company’s Board of Directors authorized a $100.0 million common share repurchase program. Repurchases under the program will be made from time-to-time through open market purchases and/or block trades. The Company intends to fund the repurchases from cash flow from operations but may also borrow under the Company’s existing credit facility.

In September 2005, we completed a buy back of certain vested and outstanding stock options for cash, which resulted in the tender and cancellation of approximately 6.4 million options. In conjunction with the buy back, we recorded a total charge of approximately $6.0 million. The buy back was implemented to reduce the option overhang resulting from the high number of options outstanding.

In July 2005, we simplified our capital structure to help us drive shareholder value by eliminating our dual class stock structure. Since July 7 Gartner’s common stock has been trading under one ticker symbol — IT.

We continue to focus on growing revenue in our core Research business. Revenue in our Research business was up 11%, or $12.9 million, in the third quarter of 2005, to $131.9 million, from $119.0 million in the third quarter of 2004. META contributed approximately $8.4 million of the increase in revenue. At September 30, 2005, contract value was $567.3 million, which is up substantially from the $489.2 million at September 30, 2004, a $78.1 million, or 16% increase. At September 30, 2005, our research client retention rate remained strong, at 78%, the same rate as of September 30, 2004. Wallet retention also remained strong but was down slightly compared to the prior year, to 92% at September 30, 2005 from 93% at September 30, 2004.

Revenue from our Consulting segment was up by 21%, or $12.6 million in the third quarter of 2005 compared to the prior year, to $72.7 million from $60.1 million, with roughly half of the increase due to META. Consulting backlog at September 30, 2005 was up 14% from the prior year, to $118.1 million at September 30, 2005, from $103.4 million at September 30, 2004. The Consulting gross contribution margin for the third quarter of 2005 increased 6 percentage points, to 41% from 35% for the third quarter of 2004. During the third quarter of 2005, our consultant utilization rate increased to 59% as compared to 58% during the third quarter of 2004. The average hourly billing rate for the third quarter of 2005 remained strong at over $300 per hour.

The outlook for our Events business continues to be strong. Our continuing emphasis on managing the Events portfolio to retain our long-time successful events and introduce promising new events has resulted in improved performance, as the gross contribution margin for the third quarter of 2005 increased 3 percentage points, to 38% from 35% for the third quarter of 2004. Overall revenues recognized during the third quarter of 2005 were approximately $1.5 million lower than the prior year quarter, which was primarily due to a planned shift of events in the Event’s calendar, as the Company held 13 events in the third quarter of 2005 compared to 15 in the same period in 2004. We have scheduled 71 events in 2005 as compared to the 56 we held in 2004.

For the third quarter of 2005 we had a net loss of $1.7 million, or $(0.02) per basic and diluted share. The third quarter 2005 net loss includes pre-tax charges of $8.0 million composed of a $6.0 million charge related to a buy back of stock options and $2.0 million of charges related to our integration of META. The net loss also includes approximately $3.4 million of non-cash amortization expense related to the $25.6 million of intangible assets we recorded on the META acquisition.

In February 2005, our Board of Directors approved the elimination of our classified Board structure. Additionally, the Board of Directors approved the combination of our Class A and Class B Common Stock. Both of these items were approved by our stockholders at our annual meeting of stockholders on June 29, 2005.

On June 29, 2005, we refinanced our existing debt by entering into an Amended and Restated Credit Agreement that provides for a five year $200.0 million term loan and a $125.0 million revolving credit facility which may be increased, at our option, up to $175.0 million. In conjunction with the refinancing, we repaid approximately $247.0 million outstanding under our existing Credit Agreement and received $250.0 million in cash under the Amended and Restated Credit Agreement consisting of a $200.0 million term loan and a $50.0 million draw on the revolving credit facility.

We ended the third quarter of 2005 with $123.9 million of stockholders’ equity and $80.5 million of cash.

Critical Accounting Policies

The preparation of financial statements requires the application of appropriate accounting policies. The policies discussed below are considered by management to be critical to an understanding of Gartner’s financial statements because their application requires significant management judgments and estimates. Specific risks for these critical accounting policies are described below.

Revenue recognition - We recognize revenue in accordance with SEC Staff Accounting Bulletin (“SAB”) No. 101, “Revenue Recognition in Financial Statements”, and SAB No. 104, “Revenue Recognition.” Revenue by significant source is accounted for as follows:

	•		Research revenues are derived from subscription contracts for research products. Revenues from research products are deferred and recognized ratably over the applicable contract term;
	•		Consulting revenues are based primarily on fixed fees or time and materials for discrete projects. Revenues for such projects are recognized as work is delivered and/or services are provided and are evaluated on a contract by contract basis;
	•		Events revenues are deferred and recognized upon the completion of the related symposium, conference or exhibition; and
	•		Other revenues, principally software licensing fees, are recognized when a signed non-cancelable software license exists, delivery has occurred, collection is probable, and the fees are fixed or determinable. Revenue from software maintenance is deferred and recognized ratably over the term of the maintenance agreement, which is typically twelve months.

The majority of research contracts are billable upon signing, absent special terms granted on a limited basis from time to time. All research contracts are non-cancelable and non-refundable, except for government contracts that have a 30-day cancellation clause, but have not produced material cancellations to date. It is our policy to record the entire amount of the contract that is billable as a fee receivable at the time the contract is signed with a corresponding amount as deferred revenue, since the contract represents a legally enforceable claim. For those government contracts that permit termination, we bill the client the full amount billable under the contract but only records a receivable equal to the earned portion of the contract. In addition, we only record deferred revenue on these government contracts when cash is received. Deferred revenues attributable to government contracts were $40.4 million and $40.9 million at September 30, 2005 and December 31, 2004, respectively. In addition, at

September 30, 2005 and December 31, 2004, we had not recognized uncollected receivables or deferred revenues, relating to government contracts that permit termination, of $4.6 million and $4.2 million, respectively.

The preliminary purchase price allocation of the META acquisition includes an estimate of the fair value of the cost to fulfill the deferred revenue obligation assumed from META. The estimated fair value of the deferred revenue obligation was determined by estimating the costs to provide the services plus a normal profit margin, and did not include any costs associated with selling efforts. As a result, in allocating the purchase price, we recorded an adjustment to reduce the carrying value of META’s March 31, 2005 deferred revenue by approximately $10.0 million. Consequently, revenues related to META contracts existing at the date of acquisition in the amount of approximately $5.0 million and $3.6 million that would have been recorded by META had it remained an independent entity were not recognized in the second and third quarters of 2005, respectively. Our revenues over the next two quarters will be reduced by the remaining $1.4 million deferred revenue reduction. As former META customers renew their contracts, we will recognize the full value of revenue from those new contracts over the respective contract periods.

Uncollectible fees receivable — The measurement of likely and probable losses and the allowance for uncollectible fees receivable is based on historical loss experience, aging of outstanding receivables, an assessment of current economic conditions and the financial health of specific clients. This evaluation is inherently judgmental and requires material estimates. These valuation reserves are periodically re-evaluated and adjusted as more information about the ultimate collectibility of fees receivable becomes available. Circumstances that could cause our valuation reserves to increase include changes in our clients’ liquidity and credit quality, other factors negatively impacting our clients’ ability to pay their obligations as they come due, and the effectiveness of our collection efforts. Total trade receivables at September 30, 2005 were $244.8 million, offset by an allowance for losses of approximately $6.1 million. Total trade receivables at December 31, 2004 were $266.1 million, offset by an allowance for losses of approximately $8.5 million.

Impairment of goodwill and other intangible assets — The evaluation of goodwill is performed in accordance with SFAS No. 142, “Goodwill and Other Intangible Assets.” Among other requirements, this standard eliminated goodwill amortization upon adoption and requires ongoing annual assessments for goodwill impairment. The evaluation of other intangible assets is performed on a periodic basis. These assessments require management to estimate the fair value of our reporting units based on estimates of future business operations and market and economic conditions in developing long-term forecasts. If we determine the fair value of any reporting unit is less than its carrying amount, we must recognize an impairment charge for the associated goodwill of that reporting unit against earnings in our financial statements. Goodwill is evaluated for impairment at least annually, or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Factors we consider important that could trigger a review for impairment include the following: significant under-performance relative to historical or projected future operating results, significant changes in the manner of our use of acquired assets or the strategy for our overall business, significant negative industry or economic trends, significant decline in our stock price for a sustained period, and our market capitalization relative to net book value.

Due to the numerous variables associated with our judgments and assumptions relating to the valuation of the reporting units and the effects of changes in circumstances affecting these valuations, both the precision and reliability of the resulting estimates are subject to uncertainty, and as additional information becomes known, we may change our estimates.

Accounting for income taxes — As we prepare our consolidated financial statements, we estimate our income taxes in each of the jurisdictions where we operate. This process involves estimating our current tax expense together with assessing temporary differences resulting from differing treatment of items for

tax and accounting purposes including, but not limited to, the value of internally developed intangible assets. These differences result in deferred tax assets and liabilities, which are included within our consolidated balance sheet. We record a valuation allowance to reduce our deferred tax assets when future realization is in question. We consider the availability of loss carryforwards, existing deferred tax liabilities, future taxable income and ongoing prudent and feasible tax planning strategies in assessing the need for the valuation allowance. In the event we determine that we would be able to realize our deferred tax assets in the future in excess of our net recorded amount, an adjustment to the deferred tax asset would increase income in the period such determination was made. Likewise, should we determine that we would not be able to realize all or part of our net deferred tax asset in the future, an adjustment to the deferred tax asset would be charged to income in the period such determination was made.

In October 2005 we received an IRS Examination Report showing proposed changes that primarily relate to the valuation of intangible assets licensed to a foreign subsidiary and the calculation of payments under a cost sharing arrangement. See Results of Operations — Provision (Benefit) for Income Taxes below for additional discussion.

Contingencies and other loss reserves and accruals — We record accruals for severance costs, lease costs associated with excess facilities, contract terminations and asset impairments as a result of acquisitions and actions we undertake to streamline our organization, reposition certain businesses and reduce ongoing costs. Estimates of costs to be incurred to complete these actions, such as future lease payments, sublease income, the fair value of assets, and severance and related benefits, are based on assumptions at the time the actions are initiated. To the extent actual costs differ from those estimates, accruals may need to be adjusted. In addition, these actions may be revised due to changes in business conditions that we did not foresee at the time such plans were approved. Additionally, we record accruals for estimated incentive compensation costs during each year. Amounts accrued at the end of each reporting period are based on our estimates and may require adjustment as the ultimate amount paid associated with these incentives are sometimes not known until after year-end.

Results of Operations

Overall Results

Total revenues increased 12% in the third quarter of 2005 to $225.3 million compared to $201.9 million for the third quarter of 2004, and increased $61.3 million, or 10%, when comparing the first nine months of 2005 to the first nine months of 2004, to $699.7 million from $638.4 million. Excluding the effect of the META acquisition and the effect of foreign currency translation, Gartner estimates that revenue for both the three months and nine months ended September 30, 2005, would have increased approximately 4%. Excluding just foreign currency translation, the revenue increase for the third quarter of 2005 would have remained at 12% but declined slightly for the first nine months, to 9%. Please refer to the section of this MD&A entitled “Segment Results” for a further discussion of revenues by segment.

Cost of services and product development increased $11.9 million, or 12%, to $112.1 million in the third quarter of 2005 from $100.2 million in the third quarter of 2004 and increased 12% when comparing the first nine months of 2005 with the first nine months of 2004. Cost of services and product development increased by approximately 1% during the first nine months of 2005 due to the effects of foreign currency translation but had little impact on the third quarter. The increase in cost of services and product development on a year-to-date basis resulted primarily from higher labor expenses across all of our lines of business, an increase of 130 people related to the META purchase, higher conference expenses related to an increase in attendees, and the negative foreign exchange impact. The increase in cost of services and product development during the third quarter was caused primarily by higher compensation costs and the increased headcount related to META.

Cost of services and product development for the first nine months of 2005 benefited by the reversal of $2.1 million of prior years’ incentive compensation program accruals. Additionally, cost of services and product development during the first nine months of 2004 benefited by the reversal of $3.5 million of prior years’ incentive compensation program accruals. As a percentage of sales, cost of services and product development was 50% for both the third quarter of 2005 and 2004, respectively. For the first nine months of 2005 and 2004, cost of services and product development as a percentage of sales was 50% and 49%, respectively.

Selling, general and administrative expenses increased $9.2 million, or 11%, to $94.3 million in the third quarter of 2005 from $85.1 million in the third quarter of 2004. SG&A expenses increased 13% to $288.6 million from $254.3 million when comparing the first nine months of 2005 to the first nine months of 2004. SG&A expenses increased by approximately 1% for the first nine months of 2005 due to the effects of foreign currency translation but had little impact on the third quarter. The $34.3 million increase in SG&A expenses on a year-to-date basis was primarily driven by compensation. We added 111 people related to the META purchase, mostly sales people, which was approximately $13.0 million of the increase. In addition, overall higher bonus and benefit costs added approximately $4.0 million, and sales commissions increases added about $4.6 million. Also, we had approximately $8.2 million of additional external consulting, data processing, and outsourcing charges, as well as the foreign currency impact of $2.0 million. The $9.2 million increase in SG&A expenses on a quarterly basis resulted primarily from increased compensation costs and the higher headcount due to META, and higher sales commissions, external consulting, and insurance costs. During the first nine months of 2004, SG&A expenses benefited by the reversal of $3.3 million of prior year’s incentive compensation program accruals. Additionally, Gartner reduced its allowance for doubtful accounts by $1.5 million in the first nine months of 2004 as a result of increased collections and a decline in write-offs.

Depreciation expense for the third quarter of 2005 decreased approximately 6% to $6.2 million, compared to $6.6 million for the third quarter of 2004, and decreased 12% when comparing the first nine months of 2005 to the first nine months of 2004. The reduction is due to a decline in capital spending.

We recorded $1.3 million in fixed assets related to the purchase of META, for which approximately $0.3 million and $0.5 million of depreciation expense was recorded in the third quarter and first nine months of 2005, respectively.

Amortization of intangibles of $3.5 million for the third quarter of 2005 increased from $0.2 million for the third quarter of 2004 due to the amortization of intangible assets from the acquisition of META. Amortization of intangibles during the first nine months of 2005 as compared to the same period in 2004 increased to $6.8 million from $0.6 million, also due to intangibles from the META acquisition.

Goodwill impairments of $0.7 million in the first nine months of 2004 were due to the closing of operations in South America.

Meta Integration Charges were $2.0 and $13.6 million for the third quarter and first nine months of 2005, respectively. These expenses relate primarily to severance, and for consulting, accounting, and tax services.

Other charges were $6.0 million in the third quarter of 2005 and were related to the completion of a buy back of certain vested and outstanding stock options for cash, which resulted in the tender and cancellation of approximately 6.4 million options.

During the second quarter of 2005 we recorded other charges of $8.2 million. Included in the second quarter charge was $8.5 million of costs related to the reduction of office space in San Jose, California, by consolidating employees from two buildings into one. We also recorded a charge of $0.6 million associated with certain stock combination expenses, which was offset by a reversal of $0.9 million of accrued severance and other charges that we determined would not be paid.

During the first quarter of 2005, we recorded other charges of $14.3 million. Included in the charge was $10.6 million for costs associated with employee termination severance payments and related benefits. The workforce reduction is a continuation of the plan announced in the fourth quarter of 2004 and has resulted in the termination of 123 employees during the three months ended March 31, 2005. In addition, we also recorded other charges of approximately $3.7 million, primarily related to a restructuring of our international operations.

During the third quarter of 2004, we recorded $4.3 million of other charges, primarily for severance charges related to the departure of our former President and COO and former CEO, of $3.1 million and $0.8 million, respectively. During the second quarter of 2004, we incurred $9.1 million of other charges which includes severance costs associated with our former CEO, as well as costs associated with the termination of 30 additional employees. During the first quarter of 2004, other charges of $10.5 million were primarily associated with a workforce alignment, which resulted in the termination of 132 employees. The workforce realignment was a continuation of an action plan initiated in the fourth quarter of 2003 which resulted in the overall reduction of 262 employees.

Gain (Loss) From Investments, Net for the first nine months of 2005 included charges of $5.1 and $0.3 million recorded in the first and second quarters of 2005, respectively, due to writedowns of our investment in SI II. We recorded the writedown in the first quarter of 2005 to reduce the investment to its estimated net realizable value after receiving preliminary indications of interest to acquire the investment for less than its recorded value. We took the additional writedown in the second quarter of 2005 based on a preliminary sale agreement for which the proceeds were less than the recorded value. On August 2, 2005, we sold our investment in SI II with no resulting gain or loss recorded on the sale since the investment was already at net realizable value.

For the first nine months of 2004 we had a loss on investments of approximately $2.2 million. The loss was recorded in the third quarter of 2004 and was due to a non-cash charge from the transfer of our investment in TruSecure to SI II, as well as a decrease in the Company’s ownership percentage in SI II of seven basis points.

Interest (expense) income, net was $3.1 million of expense during the third quarter of 2005 and $7.8 million of expense during the first nine months of 2005 as compared to expense of $0.6 million and income of $13,000, respectively, for the same periods in 2004. The increase in interest expense was due to the credit agreement signed in the third quarter of 2004 and related borrowings. Also, during the fourth quarter of 2003 we converted our outstanding debt into equity, which substantially eliminated interest expense in the first and second quarters of 2004.

Other expense, net for the third quarter and first nine months of 2005 consists primarily of net foreign currency exchange gains and losses. For the first nine months of 2004, we recorded a non-cash write-off of $2.9 million for accumulated foreign currency translation adjustments associated with certain of our operations in South America that were closed. As a result of the decision to close the operations, we were required to reclassify these currency adjustments that have been accumulated within equity, in accordance with Statement of Financial Accounting Standards No. 52 “Foreign Currency Translation,” to earnings.

The remaining charges for the first nine months of 2004, and for the third quarter of 2004, consist primarily of net foreign currency exchange gains and losses.

Provision (benefit) for income taxes for the third quarter of 2005 and 2004 was 17% and 94% of (loss) income before income taxes, respectively. For the first nine months of 2005 and 2004, the respective provision (benefit) for income taxes was 14% and 46% of (loss) income before income taxes. Excluding certain one-time charges, the provision for income taxes for quarter to date and year to date September 2005 was 31% and 33% of pre-tax book income respectively. Excluding certain one-time charges, the provision for income taxes for both quarter to date and year to date September 2004 was 33% of pre-tax book income. In 2005, the most significant of these charges include expenses related to the acquisition and integration of META which are not deductible for tax purposes, and capital losses on the sale of SI II for which we established a full valuation allowance. In 2004, the most significant of these charges included nondeductible goodwill impairment, the non-deductible write-off of accumulated foreign currency translation adjustments associated with certain South American operations, and certain severance charges.

The Internal Revenue Service (“IRS”) has completed the field work portion of an audit of our federal income tax returns for tax years ended September 30, 1999, through 2002. In October 2005, we received an Examination Report showing proposed changes that primarily relate to the valuation of intangible assets licensed to a foreign subsidiary and the calculation of payments under a cost sharing arrangement between Gartner Inc. and one of its foreign subsidiaries. Gartner disagrees with the proposed adjustments relating to valuation and cost sharing and intends to vigorously dispute this matter through applicable IRS and judicial procedures, as appropriate. However, if the IRS were to ultimately prevail on the valuation and cost sharing arrangements, it could result in additional taxable income for the years under examination of approximately $130.7 million and an additional federal cash tax liability of approximately $41.0 million. The Company recorded a provision in prior periods based on our estimate of the amount the claim will be settled, and no additional amount was booked in the current period. Although the final resolution of the proposed adjustments is uncertain, we believe the ultimate disposition of this matter will not have a material adverse effect on our consolidated financial position, cash flows, or results of operations, but it could have an impact in the period in which it is resolved.

In March of 2005, we repatriated approximately $52.0 million in earnings from its non-US subsidiaries. The repatriation was expected to qualify for a one-time reduced tax rate pursuant to the American Jobs Creation Act (AJCA). To date, we has recorded net deferred tax charges of $1.4 million for the tax impact of the repatriation as calculated under the AJCA.

SEGMENT RESULTS

We evaluate reportable segment performance and allocate resources based on gross contribution margin. Gross contribution is defined as operating income excluding certain selling, general and administrative expenses, depreciation, amortization of intangibles, goodwill impairment, income taxes, META integration charges, and other charges. Gross contribution margin is defined as gross contribution as a percentage of revenues.

Research

Revenue in our Research business was up 11% in the third quarter of 2005, or $12.9 million, to $131.9 million, from $119.0 million in the third quarter of 2004, with foreign currency having no impact. Revenue for the quarter increased due to the acquisition of META, which added approximately $8.4 million, and from organic growth. For the nine months ended September 30, 2005, Research revenues

increased $31.8 million, or 9%, to $392.0 million compared to $360.2 million for the same period of 2004. Revenue for the year-to-date period was up mainly due to the acquisition of META, which added approximately $17.0 million, and growth in our Executive Programs. In addition, the impact of foreign currency added approximately 1% to year to date revenue in 2005. At September 30, 2005, our research client retention rate remained strong, at 78%, the same rate as of September 30, 2004. Wallet retention was down slightly compared to the prior year, to 92% at September 30, 2005 from 93% at September 30, 2004. Our Executive Program membership was 3,450 at September 30, 2005, compared to 2,712 at September 30, 2004, a 27% increase.

Research gross contribution of $78.6 million for the third quarter of 2005 increased 9% from the $72.1 million for the third quarter of 2004, while gross contribution margin for the third quarter of 2005 decreased slightly, to 60% from 61% in the prior year period. For the nine months ended September 30, 2005, gross contribution increased to $236.6 million, a 60% contribution margin, from $224.1 million, or a 62% contribution margin, in the comparable prior year period. The decrease in gross contribution margin during 2005 was due primarily to an increase in compensation costs, increased headcount due to the META acquisition, and a shift in the mix of our research products to lower margin Executive Programs.

At September 30, 2005, contract value was $567.3 million, which is up substantially from the $489.2 million at September 30, 2004, a $78.1 million, or 16% increase. Of the $78.1 million increase in contract value, approximately $40.0 million is attributable to META. Excluding the impact of foreign currency, contract value increased 13% over the prior year.

Consulting

Consulting revenues increased 21%, or $12.7 million, to $72.7 million in the third quarter of 2005 and increased 12%, or $23.5 million, to $215.8 million for the first nine months of 2005 as compared to the same periods of 2004. META added approximately $6.1 million and $10.4 million of revenue to the third quarter and first nine months of 2005, respectively. The revenue increases also reflect strong organic growth as we continue to execute our strategy of focusing on fewer accounts, selling large deals through integrated solutions, and enhancing profitability through improved resource management. In addition, revenue increased over the prior year periods in spite of our exit from certain less profitable consulting practices and geographies in 2004. The impact of foreign currency translation added approximately 1% to nine months 2005 revenue but had an immaterial impact on the quarter. Billable headcount was 533 at September 30, 2005, compared to 473 at September 30, 2004, a 13% increase.

Consulting gross contribution of $29.8 million for the third quarter of 2005 increased 44% from $20.7 million for the third quarter of 2004, while contribution margin for the third quarter of 2005 increased to 41% from 35% in the prior year quarter. Gross contribution of $84.6 million for the first nine months of 2005 increased 19% from $70.8 million for the same period of 2004, while contribution margin for the first nine months of 2005 increased to 39% from 37%. The 6 point increase in gross contribution margin for the third quarter of 2005 compared to 2004 was primarily due to higher engagement profitability. The billing rate remained at over $300 per hour for both the third quarter of 2005 and for the first nine months of 2005. Consulting utilization declined slightly, to 61% for the nine months ended September 30, 2005 from 62% in the prior year period.

Consulting backlog, which represents future revenues to be recognized from in-process consulting, measurement and SAS, increased $14.7 million, or 14%, to $118.1 million at September 30, 2005, compared to $103.4 million at September 30, 2004. Of the $14.7 million increase in backlog, approximately $5.0 million is attributable to the META acquisition.

Events

Events revenues during the third quarter of 2005 were $1.5 million lower than the prior year quarter, at $17.2 million from $18.7 million, respectively. The lower revenue was primarily due to timing as we had a planned shift of events in the Event’s calendar. While the total number of events for the year increased, we held fewer events in the third quarter of 2005, 13, compared to 15 in the prior year quarter. Although revenue for the quarter was down due to timing, revenue from the 8 on-going events held in the quarter was up 4%. We have scheduled 71 events in 2005 as compared to the 56 we held in 2004, and as we manage our Events portfolio, we continue to replace certain less profitable events with more promising ones.

For the nine months ended September 30, 2005, Events revenues increased $8.1 million, or 11%, to $82.2 million compared to $74.1 million for the same period of 2004. The increase was due to an increase in the number of events, to 52 for the first nine months of 2005 compared to 44 in the comparable prior year period, as well as a significant improvement in revenues from on-going events. Revenue has increased during 2005 due to the strong performance of our recurring events, as well as the addition of new events in 2005 that had higher revenues than the events that were eliminated. The number of attendees at our Events increased by over 20% for the first nine months of 2005 compared to 2004, rising to 21,254 from 17,705, respectively. Revenues during the first nine months of 2005 benefited from the positive effects of foreign currency translation by approximately 1.5%.

Gross contribution was $6.5 million, or 38% of revenues, for the third quarter of 2005, compared to $6.6 million, or 35% of revenues, for the third quarter of 2004, which represents a 3 point increase. The 3 point increase in gross contribution margin was mainly due to a higher number of attendees and price increases for exhibitors.

Gross contribution of $36.6 million, or 45% of revenues, for the first nine months of 2005 increased from $30.5 million, or 41% of revenues for the first nine months of 2004, a 4 point increase. The 4 point increase in gross contribution margin was primarily due to stronger performance at our 33 on-going events. The primary drivers of this stronger performance included increased volume of attendees discussed above as well as price increases for exhibitors.

Liquidity and Capital Resources

Cash provided by operating activities totaled $27.6 million for the nine months ended September 30, 2005, compared to $46.3 million for the nine months ended September 30, 2004, an $18.7 million decline. The net decrease in cash flow from operating activities was due primarily to the payment of $30.0 million of META integration payments, higher employee compensation costs, and to a lesser extent, a shift in the mix of our products in the Research segment from higher margin core research to lower margin Executive Programs. Offsetting these decreases was a $12.0 million increase in working capital, primarily from faster collection of fees receivable and lower bonus payments, along with a decline of approximately $4.0 million in severance and other payments in 2005 compared to the prior year,

Cash used in investing activities increased to $170.7 million during the first nine months of 2005 as compared to $19.0 million during the first nine months of 2004, due to the acquisition of META, which was completed on April 1, 2005. The Company’s net cash investment in META was approximately $161.3 million through September 30, 2005, which includes $176.4 million of cash paid, including transaction costs, less the $15.1 million acquired from META. Offsetting the cash paid for META was a decline in capital expenditures, which decreased $7.8 million for the first nine months of 2005 compared

to the same period in 2004, and $1.3 million in cash received from the sale of the Company’s investment in SI II.

Cash provided by financing activities totaled $67.7 million for the nine months ended September 30, 2005, compared to $98.6 million of cash used for the nine months ended September 30, 2004. The increase was primarily driven by the borrowing of additional debt in 2005 and cash used in 2004 for stock repurchases.

We borrowed $250.0 million on June 29, 2005 related to the refinancing of our debt by entering into an Amended and Restated Credit Agreement (as discussed in Note 11 – Debt above and the “Obligations and Commitment” section below), $67.0 million in April under the revolver related to the META acquisition, and $10.0 million under the revolver which was used to make the second quarter 2005 quarterly payment on the Term A loan. We repaid $267.9 million in debt during the first nine months of 2005, which included $247.0 million on June 29, 2005 related to the refinancing, $20.0 million in quarterly debt payments, and $0.9 million related to a note payable we acquired in the META acquisition. We also paid $1.1 million in debt issue costs during the second quarter of 2005 related to the refinancing of our debt.

We received proceeds from stock issued for stock plans of $14.2 million during the first nine months of 2005 as compared to $56.5 million during the same period in the prior year as a result of our higher stock price during the first nine months of 2004 as compared to 2005, which resulted in more stock option exercises by employees in 2004. The Company used $4.5 million of cash to buy back its stock options in the third quarter of 2005. During the first nine months of 2004, we used $346.1 million of cash for a stock tender offer and $6.1 million of cash for treasury stock purchases.

Obligations and Commitments

On June 29, 2005, we refinanced our existing debt by entering into an Amended and Restated Credit Agreement that provides for a five-year $200.0 million term loan and a $125.0 million revolving credit facility which may be increased, at Gartner’s option, up to $175.0 million. In conjunction with the refinancing, the Company repaid approximately $247.0 million outstanding under its existing Credit Agreement and received $250.0 million in cash under the Amended and Restated Credit Agreement consisting of a $200.0 million term loan and a $50.0 million draw on the revolving credit facility. At September 30, 2005, we had approximately $70.1 million of remaining capacity under the credit facility.

In the third quarter of 2005, the Company borrowed and repaid $10.0 million under the revolving credit facility. On September 30, 2005, there was $200.0 million outstanding on the term loan and $50.0 million outstanding on the revolving credit facility. As of October 31, 2005, the interest rates on the term loan and revolver were 5.53% and 4.67%, respectively.

We believe that our existing cash balances, together with cash from our operating activities and the additional borrowing capacity under our amended five-year credit facility, will be sufficient for our expected short-term and foreseeable long-term needs. We continue to evaluate our capital structure based on our current and long-term liquidity needs.

The following table represents our contractual cash commitments at September 30, 2005 (in millions), including contractual commitments related to the META acquisition. The table excludes interest payments related to our credit facility:

						Less												More
						Than				1 - 3				4 - 5				Than
		Total				1 Year				Years				Years				5 Years
Credit facility (1)		$	250.0			$	65.0			$	70.0			$	115.0			$	—
Operating leases			205.9				30.9				50.5				25.9				98.6
Severance associated with workforce reductions			6.1				5.8				0.3				—				—
Contract terminations and other			2.4				2.4				—				—				—
Stock option buy back (2)			1.5				1.5				—				—				—
Miscellaneous service agreements			0.6				0.6				—				—				—
Totals		$	466.5			$	106.2			$	120.8			$	140.9			$	98.6

$100 Million Share Repurchase Program

In October 2005, our Board of Directors authorized a $100.0 million common share repurchase program. Repurchases under the program will be made from time-to-time through open market purchases and/or block trades. Repurchases are subject to the availability of stock, prevailing market conditions, the trading price of the Company’s common stock, and our financial performance. The Company intends to fund the repurchases from cash flow from operations and possibly from borrowings under our existing credit facility.

Stock Option Buy Back

During the third quarter of 2005, we completed a one-time offer to buy back certain vested and outstanding stock options for cash, which resulted in the tender and cancellation of 6,383,445 options. In conjunction with the buyback, we recorded a charge of approximately $6.0 million, including transaction and related costs. As of September 30, 2005, approximately $4.5 million related to the option buy back had been paid, while the remaining $1.5 million was paid in October 2005.

Off-Balance Sheet Arrangements

Through September 30, 2005, we have not entered into any off-balance sheet arrangements or transactions with unconsolidated entities or other persons.

BUSINESS AND TRENDS

Our quarterly and annual revenue, operating income, and cash flow fluctuate as a result of many factors, including the timing of the execution of research contracts, the timing of Symposia and other events, all of which occur to a greater extent in the fourth quarter, as well as the extent of completion of consulting engagements, the amount of new business generated, the mix of domestic and international business, changes in market demand for our products and services, the timing of the development, introduction and marketing of new products and services, and competition in the industry. The potential fluctuations in our operating income could cause period-to-period comparisons of operating results not to be meaningful and could provide an unreliable indication of future operating results.

Factors That May Affect Future Performance.

We operate in a very competitive and rapidly changing environment that involves numerous risks and uncertainties, some of which are beyond our control. In addition, we and our clients are affected by the economy. The following section discusses many, but not all, of these risks and uncertainties.

Decreases in IT Spending Could Lead to Decreases in Our Revenues. Our revenues and results of operations are influenced by economic conditions in general and more particularly by business conditions in the IT industry. A general economic downturn or recession, anywhere in the world, could negatively affect demand for our products and services and may substantially reduce existing and potential client information technology-related budgets. Such a downturn could materially and adversely affect our business, financial condition and results of operations, including the ability to: maintain client retention, wallet retention and consulting utilization rates, and achieve contract value and consulting backlog.

We May Not Successfully Integrate the Acquisition of META. We have made and may continue to make acquisitions of, or significant investments in, businesses that offer complementary products and services, including our acquisition of META that we completed on April 1, 2005. The risks involved in each acquisition or investment include the possibility of paying more than the value we derive from the acquisition, dilution of the interests of our current stockholders or decreased working capital, increased indebtedness, the assumption of undisclosed liabilities and unknown and unforeseen risks, the ability to integrate successfully and efficiently the operations and personnel of the acquired business, the ability to retain key personnel of the acquired company, the time to train the sales force to market and sell the products of the acquired company, the potential disruption of our ongoing business and the distraction of management from our business. The realization of any of these risks could adversely affect our business.

If the Recently Implemented Restructuring and Reorganization of Our Management Team Does Not Achieve the Results That We Anticipate, the Success of Our Business Strategy May Suffer. Our future success depends, in significant part, upon the continued service and performance of our senior management and other key personnel. We have recently reorganized our business around specific client needs. As part of this reorganization, a number of key management positions have been filled by the promotion of current employees or the hiring of new employees. Additionally, we have restructured our workforce in order to streamline operations and strengthen key consulting practices. If the reorganization and restructuring of our business does not lead to the results we expect, our ability to effectively deliver our products, manage our company and carry out our business plan may be impaired.

We Face Significant Competition Which Could Materially Adversely Affect Our Financial Condition, Results of Operations and Cash Flows. We face direct competition from a significant number of independent providers of information products and services, including information that can be found on the Internet free of charge. We also compete indirectly against consulting firms and other information providers, including electronic and print media companies, some of which may have greater financial, information gathering and marketing resources than we do. These indirect competitors could choose to compete directly with us in the future. In addition, limited barriers to entry exist in the markets in which we do business. As a result, additional new competitors may emerge and existing competitors may start to provide additional or complementary services. Additionally, technological advances may provide increased competition from a variety of sources. However, we believe the breadth and depth of our research assets position us well versus our competition. Increased competition may result in loss of market share, diminished value in our products and services, reduced pricing and increased marketing expenditures. We may not be successful if we cannot compete effectively on quality of research and analysis, timely delivery of information, customer service, the ability to offer products to meet changing market needs for information and analysis, or price.

We Depend on Renewals of Subscription Base Services and Our Failure to Renew at Historical Rates Could Lead to a Decrease in Our Revenues. Some of our success depends on renewals of our subscription-based research products and services, which constituted 59% of our revenues for both the

third quarter of 2005 and 2004. These research subscription agreements have terms that generally range from twelve to thirty months. Our ability to maintain contract renewals is subject to numerous factors, including the following:

•

delivering high-quality and timely analysis and advice to our clients;

•

understanding and anticipating market trends and the changing needs of our clients; and

•

delivering products and services of the quality and timeliness necessary to withstand competition.

Additionally, as we implement our strategy to realign our business to client needs, we may shift the type and pricing of our products which may impact client renewal rates. While research client retention rates were 78% at both September 30, 2005 and 2004, there can be no guarantee that we will continue to maintain this rate of client renewals. Any material decline in renewal rates could have an adverse impact on our revenues and our financial condition.

We Depend on Non-Recurring Consulting Engagements and Our Failure to Secure New Engagements Could Lead to a Decrease in Our Revenues. Consulting segment revenues constituted 32% of our revenues for the third quarter of 2005 and 30% for the third quarter of 2004. These consulting engagements typically are project-based and non-recurring. Our ability to replace consulting engagements is subject to numerous factors, including the following:

•

delivering consistent, high-quality consulting services to our clients;

•

tailoring our consulting services to the changing needs of our clients; and

•

our ability to match the skills and competencies of our consulting staff to the skills required for the fulfillment of existing or potential consulting engagements.

Any material decline in our ability to replace consulting arrangements could have an adverse impact on our revenues and our financial condition.

We May Not be Able to Attract and Retain Qualified Personnel Which Could Jeopardize the Quality of Our Research. Our success depends heavily upon the quality of our senior management, research analysts, consultants, sales and other key personnel. We face competition for the limited pool of these qualified professionals from, among others, technology companies, market research firms, consulting firms, financial services companies and electronic and print media companies, some of which have a greater ability to attract and compensate these professionals. Some of the personnel that we attempt to hire are subject to non-compete agreements that could impede our short-term recruitment efforts. Any failure to retain key personnel or hire and train additional qualified personnel as required to support the evolving needs of clients or growth in our business, could adversely affect the quality of our products and services, and our future business and operating results.

We May Not be Able to Maintain Our Existing Products and Services. We operate in a rapidly evolving market, and our success depends upon our ability to deliver high quality and timely research and analysis to our clients. Any failure to continue to provide credible and reliable information that is useful to our clients could have a material adverse effect on future business and operating results. Further, if our predictions prove to be wrong or are not substantiated by appropriate research, our reputation may suffer and demand for our products and services may decline. In addition, we must continue to improve our methods for delivering our products and services in a cost-effective manner. Failure to increase and

improve our electronic delivery capabilities could adversely affect our future business and operating results.

We May Not be Able to Introduce the New Products and Services that We Need to Remain Competitive. The market for our products and services is characterized by rapidly changing needs for information and analysis. To maintain our competitive position, we must continue to enhance and improve our products and services, develop or acquire new products and services in a timely manner, and appropriately position and price new products and services relative to the marketplace and our costs of producing them. Any failure to achieve successful client acceptance of new products and services could have a material adverse effect on our business, results of operations or financial position.

Our International Operations Expose Us to a Variety of Risks Which Could Negatively Impact Our Future Revenue and Growth. Approximately 38% of our revenues for the third quarter of 2005 were derived from sales outside of North America. As a result, our operating results are subject to the risks inherent in international business activities, including general political and economic conditions in each country, changes in market demand as a result of exchange rate fluctuations and tariffs and other trade barriers, challenges in staffing and managing foreign operations, changes in regulatory requirements, compliance with numerous foreign laws and regulations, different or overlapping tax structures, higher levels of United States taxation on foreign income, and the difficulty of enforcing client agreements, collecting accounts receivable and protecting intellectual property rights in international jurisdictions. We rely on local distributors or sales agents in some international locations. If any of these arrangements are terminated by our agent or us, we may not be able to replace the arrangement on beneficial terms or on a timely basis, or clients of the local distributor or sales agent may not want to continue to do business with us or our new agent.

We May Not be Able to Maintain the Equity in Our Brand Name. We believe that our “Gartner” brand is critical to our efforts to attract and retain clients and that the importance of brand recognition will increase as competition increases. We may expand our marketing activities to promote and strengthen the Gartner brand and may need to increase our marketing budget, hire additional marketing and public relations personnel, expend additional sums to protect the brand and otherwise increase expenditures to create and maintain client brand loyalty. If we fail to effectively promote and maintain the Gartner brand, or incur excessive expenses in doing so, our future business and operating results could be materially and adversely impacted.

The Costs of Servicing Our Outstanding Debt Could Impair Our Future Operating Results. We have a $200.0 million senior credit facility as well as a $125.0 million revolving credit facility. The affirmative, negative and financial covenants of the credit facility could limit our future financial flexibility. The associated debt service costs of these facilities could impair our future operating results. The outstanding debt may limit the amount of cash or additional credit available to us, which could restrain our ability to expand or enhance products and services, respond to competitive pressures or pursue future business opportunities requiring substantial investments of additional capital.

If We Are Unable to Enforce and Protect Our Intellectual Property Rights Our Competitive Position May be Harmed. We rely on a combination of copyright, patent, trademark, trade secret, confidentiality, non-compete and other contractual provisions to protect our intellectual property rights. Despite our efforts to protect our intellectual property rights, unauthorized third parties may obtain and use technology or other information that we regard as proprietary. Our intellectual property rights may not survive a legal challenge to their validity or provide significant protection for us. The laws of certain countries do not protect our proprietary rights to the same extent as the laws of the United States. Accordingly, we may not be able to protect our intellectual property against unauthorized third-party copying or use, which could adversely affect our competitive position. Our employees are subject to non-compete agreements. When the non-competition period expires, former employees may compete against us. If a former employee

chooses to compete against us prior to the expiration of the non-competition period, there is no assurance that we will be successful in our efforts to enforce the non-compete provision.

We May be Subject to Infringement Claims. Third parties may assert infringement claims against us. Regardless of the merits, responding to any such claim could be time consuming, result in costly litigation and require us to enter into royalty and licensing agreements which may not be offered or available on reasonable terms. If a successful claim is made against us and we fail to develop or license a substitute technology, our business, results of operations or financial position could be materially adversely affected.

Our Operating Results May Fluctuate Which May Make Our Future Operating Results Difficult to Predict. Our quarterly and annual operating income may fluctuate in the future as a result of many factors, including the timing of the execution of research contracts, which typically occurs in the fourth calendar quarter, the extent of completion of consulting engagements, the timing of symposia and other events, which also occur to a greater extent in the fourth calendar quarter, the amount of new business generated, the mix of domestic and international business, changes in market demand for our products and services, the timing of the development, introduction and marketing of new products and services, and competition in the industry. An inability to generate sufficient earnings and cash flow, and achieve our forecasts, may impact our operating and other activities. The potential fluctuations in our operating income could cause period-to-period comparisons of operating results not to be meaningful and may provide an unreliable indication of future operating results.

Interests of Certain of Our Significant Stockholders May Conflict With Yours. Silver Lake Partners, L.P. (“SLP”) and its affiliates own approximately 33.2% of our common stock as of October 31, 2005. SLP is restricted from purchasing additional stock without our consent pursuant to the terms of a Securityholders’ Agreement. This Securityholders’ Agreement also provides that we cannot take certain actions, including acquisitions and sales of stock and/or assets without SLP’s consent. Additionally, ValueAct Partners and its affiliates own approximately 16.3% of our common stock as of October 31, 2005. While neither SLP nor ValueAct holds a majority of our outstanding shares, they may be able, either individually or together, to exercise significant influence over matters requiring stockholder approval, including the election of directors and the approval of mergers, consolidations and sales of our assets. Their interests may differ from the interests of other stockholders.

Our Anti-takeover Protections May Delay or Prevent a Change of Control. Provisions of our certificate of incorporation and bylaws and Delaware law may make it difficult for any party to acquire control of us in a transaction not approved by our Board of Directors. These provisions include:

•

The ability of our Board of Directors to issue and determine the terms of preferred stock;

•

Advance notice requirements for inclusion of stockholder proposals at stockholder meetings;

•

A preferred shares rights agreement; and

•

The anti-takeover provisions of Delaware law.

These provisions could delay or prevent a change of control or change in management that might provide stockholders with a premium to the market price of their Common Stock.

We May Have to Take Substantial Non-Cash Compensation Charges in Future Periods. On October 15, 2004, we announced that Eugene A. Hall received an inducement grant of 500,000 shares of restricted stock with a market value on the date of grant of $12.05 per share. As long as Mr. Hall remains an employee, the restriction on the 500,000 shares of restricted stock will lapse upon the earlier of (a) our 60 day average stock price meeting certain targets, or (b) a change in control. The price targets are $20 for

39

interim or annual reporting period of the registrant’s first fiscal year beginning on or after June 15, 2005. Gartner is planning to adopt SFAS 123R on January 1, 2006.

We are currently assessing the impact SFAS 123R will have on our financial position, cash flows, and results of operations. Projecting the amount of future stock compensation expense is inherently difficult due to the uncertainty of a number of factors, among them the level of volatility of our common stock. Currently we disclose the pro forma impact of stock compensation as required by SFAS 123, and for the nine months ended September 30, 2005, our net income would have been reduced by approximately $11.0 million (excluding the effect of the third quarter 2005 one-time option buy back) if stock compensation expense had been included in our results of operations. Accordingly, we believe the adoption of SFAS 123R will have a materially negative impact on our earnings.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

At September 30, 2005 we have exposure to market risk for changes in interest rates since we had $250.0 million drawn on our credit facility. The loans bear interest, at our option, at a rate equal to the greatest of the Administrative Agent’s prime rate, the Administrative Agent’s rate for three-month certificates of deposit (adjusted for statutory reserves) and the average rate on overnight federal funds plus ¹/2 of 1% plus a spread equal to between 0.00% and 0.75% depending on our leverage ratio as of the fiscal quarter most recently ended, or at the Eurodollar rate (adjusted for statutory reserves) plus a spread equal to between 1.00% and 1.75%, depending on the Company’s leverage ratio as of the fiscal quarter most recently ended. The applicable interest rate as of October 1, 2005 was 5.0%. We believe that an increase or decrease of 10% in the effective interest rate on available borrowings from our credit facility would not have a material effect on our future results of operations. Each 25 basis point increase or decrease in interest rates would have an approximate $0.8 million annual pre-tax effect under the revolving credit facility when fully utilized.

Investment Risk

We are exposed to market risk as it relates to changes in the market value of our equity investments. We invest in equity securities of public and private companies directly. As of September 30, 2005, we had remaining investments in securities of $1.1 million. These investments are inherently risky as the businesses are typically in early development stages and may never develop. Further, certain of these investments are in publicly traded companies whose shares are subject to significant market price volatility. Adverse changes in market conditions and poor operating results of the underlying investments may result in us incurring additional losses or an inability to recover the original carrying value of our investments. If there were a 100% adverse change in the value of our investment portfolio as of September 30, 2005, this would result in a non-cash impairment charge of approximately $1.1 million.

Foreign Currency Exchange Risk

We face two risks related to foreign currency exchange: translation risk and transaction risk. Amounts invested in our foreign operations are translated into U.S. dollars at the exchange rates in effect at the balance sheet date. The resulting translation adjustments are recorded as a component of accumulated other comprehensive income (loss), net in the stockholders’ equity section of the Consolidated Balance Sheets. Our foreign subsidiaries generally collect revenues and pay expenses in currencies other than the United States dollar. Since the functional currencies of our foreign operations are generally denominated in the local currency of our subsidiaries, the foreign currency translation adjustments are reflected as a component of stockholders’ equity and do not impact operating results. Revenues and expenses in foreign currencies translate into higher or lower revenues and expenses in U.S. dollars as the U.S. dollar weakens or strengthens against other currencies. Therefore, changes in exchange rates may affect our consolidated revenues and expenses (as expressed in U.S. dollars) from foreign operations. Currency transaction gains

or losses arising from transactions in currencies other than the functional currency are included in results of operations.

From time to time we enter into foreign currency forward contracts or other derivative financial instruments to hedge the effects of adverse fluctuations in foreign currency exchange rates. At September 30, 2005, we had seven foreign currency forward contracts outstanding. Foreign currency forward contracts are reflected at fair value with gains and losses recorded currently in earnings.

The following table presents information about our foreign currency forward contracts outstanding as of September 30, 2005, expressed in U.S. dollar equivalents:

										Forward
Currency						Contract				Exchange				Unrealized				Expiration
Purchased		Currency Sold				Amount				Rate				Gain (Loss)				Date
SEK		EUR					711,000				.1068				(1,000	)		October 24, 2005
EUR		SGD					610,000				2.036				(3,000	)		October 24, 2005
DKK		EUR					1,884,000				.1340				—			October 24, 2005
USD		EUR					4,124,000				.8272				24,000			October 24, 2005
GBP		EUR					7,163,000				1.472				(8,000	)		October 24, 2005
USD		EUR					18,238,000				.8181				(97,000	)		October 24, 2005
USD		AUD					3,576,000				1.30				(37,000	)		October 24, 2005

ITEM 4. CONTROLS AND PROCEDURES

We have established disclosure controls and procedures that are designed to ensure that the information we are required to disclose in our reports filed under the Securities Exchange Act of 1934, as amended (the “Act”), is recorded, processed, summarized and reported in a timely manner. Specifically, these controls and procedures ensure that the information is accumulated and communicated to our executive management team, including our chief executive officer and our chief financial officer, to allow timely decisions regarding required disclosure.

Management conducted an evaluation, as of September 30, 2005, of the effectiveness of the design and operation of our disclosure controls and procedures, under the supervision and with the participation of our chief executive officer and chief financial officer. Based upon that evaluation, our chief executive officer and chief financial officer have concluded that the Company’s disclosure controls and procedures are effective in alerting them in a timely manner to material Company information required to be disclosed by us in reports filed under the Act.

In addition, there have been no changes in the Company’s internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The Internal Revenue Service (“IRS”) has completed the field work portion of an audit of the Company’s federal income tax returns for tax years ended September 30, 1999, through 2002. In October 2005, the Company received an Examination Report showing proposed changes that primarily relate to the valuation of intangible assets licensed to a foreign subsidiary and the calculation of payments under a cost sharing arrangement between Gartner Inc. and one of its foreign subsidiaries. The Company disagrees with the proposed adjustments relating to valuation and cost sharing and intends to vigorously dispute this matter through applicable IRS and judicial procedures, as appropriate. However, if the IRS were to ultimately prevail on the valuation and cost sharing arrangements, it could result in additional taxable income for the years under examination of approximately $130.7 million and an additional federal cash tax liability of approximately $41.0 million. The Company recorded a provision in prior periods based on our estimate of the amount the claim will be settled, and no additional amount was booked in the current period. Although the final resolution of the proposed adjustments is uncertain, we believe the ultimate disposition of this matter will not have a material adverse effect on our consolidated financial position, cash flows, or results of operations, but it could have an impact in the period in which it is resolved.

ITEM 5. OTHER INFORMATION

On November 9, 2005, Gartner and Eugene A. Hall, its chief executive officer, agreed to cancel Mr. Hall’s existing 500,000 share restricted stock award and replace it with a new award for the same amount of shares and on similar terms. This was done for tax reasons and the number of shares of restricted stock issued to Mr. Hall remains unchanged. By issuing the restricted sock award under its stockholder approved 2003 Long Term Incentive Plan, Gartner will be able to take a tax deduction when and if the restrictions lapse on the restricted stock award. Gartner would not have been able to take advantage of this tax deduction on the award in its current form because the award had been made as an inducement grant, and consequently was not issued pursuant to a stockholder approved plan. Gartner and Mr. Hall have entered into (i) a Termination of Restricted Stock Agreement to cancel the original award of 500,000 shares of restricted stock which was made on October 15, 2004; and (ii) a Restricted Stock Agreement which makes a new grant to him of 500,000 shares of restricted stock under Gartner’s 2003 Long Term Incentive Plan.

Similarly to the grant being cancelled, the restrictions on this new grant lapse as to (i) 300,000 shares when the Company’s Common Stock trades at an average price of $20 or more for sixty (60) consecutive trading days, (ii) 100,000 shares when the Company’s Common Stock trades at an average price of $25 or more for sixty (60) consecutive trading days, and (iii) 100,000 shares when the Company’s common stock trades at an average price of $30 or more for sixty (60) consecutive trading days, subject to Mr. Hall’s continued employment with the Company through each such date. Notwithstanding the preceding sentence, all restrictions shall lapse in full upon a change in control.

ITEM 6. EXHIBITS

(a) Exhibits

EXHIBIT
NUMBER		DESCRIPTION OF DOCUMENT
10.1		Termination of Restricted Stock Agreement, dated November 9, 2005, by and between Gartner, Inc. and Eugene A. Hall.
10.2		Restricted Stock Agreement, dated November 9, 2005, by and between Gartner, Inc. and Eugene A. Hall.
31.1		Certification of chief executive officer under Section 302 of the Sarbanes-Oxley Act of 2002.
31.2		Certification of chief financial officer under Section 302 of the Sarbanes-Oxley Act of 2002.
32		Certification under Section 906 of the Sarbanes-Oxley Act of 2002.

Items 2, 3 and 4 of Part II are not applicable and have been omitted.

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		Gartner, Inc.
Date November 9, 2005		/s/ Christopher Lafond
		Christopher Lafond
		Executive Vice President
		and Chief Financial Officer
		(Principal Financial and
		Accounting Officer)

EXHIBIT 10.1

TERMINATION OF RESTRICTED STOCK AGREEMENT

This TERMINATION OF RESTRCITED STOCK AGREEMENT (this “Agreement”) is made as of November 9, 2005, by and between Gartner, Inc. (the “Company”), a Delaware Corporation and Eugene A. Hall (“Employee”)

Recitals

     WHEREAS, the Company granted Employee an inducement grant of Five Hundred Thousand (500,000) Shares of restricted stock (the “Current Restricted Stock Award”) pursuant to the terms of that certain Restricted Stock Agreement, by and between Gartner and Employee, dated as of October 15, 2004 (the “Current Restricted Stock Agreement”).

     WHEREAS, the Compensation Committee of the Company has determined that it is in the best interest of the Company to cancel the current Restricted Stock Award and to grant Employee a new grant of 500,000 shares of restricted stock pursuant to the terms of the Company’s 2003 Long Term Incentive Plan (the “New Restricted Stock Award”) and that certain Restricted Stock Agreement by and between Gartner and Employee and dated as of the date hereof (the “New Restricted Stock Agreement”).

     NOW THEREFORE, for good value and consideration, including the issuance of the New Restricted Stock Award and the entry into the New Restricted Stock Agreement, the receipt and sufficiency of which are hereby acknowledged, the Company and the Employee agree as follows:

Agreement

     1. Termination of Agreement. The Company and Employee hereby agree that as of the date first above written the Current Restricted Stock Agreement shall terminate and shall be of no further force and effect. The Current Restricted Stock Award will be deemed forfeited and Employee shall return to the Company any and all shares from such award that Employee has in his possession for cancellation by the Company.

     2. Successors. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns.

     3. Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of Connecticut, other than its conflicts of laws provisions..

     4. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which when taken together shall constitute one and the same instrument

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.

		GARTNER, INC.
		/s/ Maynard G. Webb, Jr.
		By: Maynard G. Webb, Jr.
		Title: Chairman of the Compensation Committee
		EMPLOYEE
		/s/ Eugene A. Hall
		Eugene A. Hall

Exhibit 10.2

GARTNER, INC.
RESTRICTED STOCK AGREEMENT FOR EUGENE A. HALL

     Gartner, Inc. (the “Company”) hereby awards to you, Eugene A. Hall (the “Employee”), an award of restricted Common Stock of the Company (the “Restricted Stock”) under the Company’s 2003 Long-Term Incentive Plan (the “Plan”). The date of this Restricted Stock Agreement (the “Agreement”) is November 9, 2005 (the “Award Date”). Subject to the provisions of Appendix A (attached hereto) and of the Plan, the principal features of this award are as follows:

Total Number of Shares of Restricted Stock: 500,000

Scheduled Vesting Dates:		Number of Shares:
The first date after October 15, 2004 on which the Company’s Common Stock trades at an average price of $20 per Share (the average price shall equal the average of the high and low sales price for the Company’s Common Stock for the trading day in question) or more on any established stock exchange or a national market system for sixty (60) consecutive trading days*			300,000
The first date after October 15, 2004 on which the Company’s Common Stock trades at an average price of $25 per Share (the average price shall equal the average of the high and low sales price for the Company’s Common Stock for the trading day in question) or more on any established stock exchange or a national market system for sixty (60) consecutive trading days*			100,000
The first date after October 15, 2004 on which the Company’s Common Stock trades at an average price of $30 per Share (the average price shall equal the average of the high and low sales price for the Company’s Common Stock for the trading day in question) or more on any established stock exchange or a national market system for sixty (60) consecutive trading days*			100,000

*Except as otherwise provided in Appendix A, Employee will not vest in the Restricted Stock unless he is employed by the Company or one of its Affiliates through the applicable vesting date.

     Your signature below indicates your agreement and understanding that this award is subject to all of the terms and conditions contained in Appendix A and the Plan. For example, important additional information on vesting and forfeiture of the Shares covered by this award is contained in Paragraphs 3, 4 and 6 of Appendix A. PLEASE BE SURE TO READ ALL OF APPENDIX A, WHICH CONTAINS THE SPECIFIC TERMS AND CONDITIONS OF THIS AGREEMENT.

GARTNER, INC.		EMPLOYEE
By:      /s/ Maynard G. Webb, Jr.		/s/ Eugene A. Hall
		EUGENE A. HALL
Title: Chairman of the Compensation Committee

APPENDIX A

TERMS AND CONDITIONS OF RESTRICTED STOCK

     1. Award. The Company hereby awards to the Employee under the Plan an award of 500,000 Shares of Restricted Stock at a purchase price $0.0005 (par value) per Share, commencing on the date hereof, subject to all of the terms and conditions in this Agreement and of the Plan. By accepting this award of Restricted Stock, the par value purchase price for each Share of Restricted Stock will be deemed paid by the Employee by past services rendered by the Employee.

     2. Transfer of Shares. As soon as practicable after the Award Date, the Company will record the Restricted Stock in book form with stock transfer agent subject to the terms and conditions set forth in the Plan. As soon as practicable after the Shares of Restricted Stock shall have vested in the manner set forth in Paragraphs 3 or 6, the Company will have the Shares listed in street name with a brokerage company of the Company’s choice, free of any restrictions imposed pursuant to this Agreement. In no event shall the Shares be so listed unless and until the Shares have vested and all other terms and conditions in this Agreement have been satisfied. By accepting the Restricted Stock, the Employee irrevocably nominates and appoints the Secretary of the Company as agent (the “Agent”) for purposes of surrendering or transferring the Restricted Stock to the Company upon any forfeiture or transfer required or authorized by this Agreement. This power is intended as a power coupled with an interest and will survive the Employee’s death. In addition, it is intended as a durable power and will survive the Employee’s disability.

     3. Vesting Schedule. Subject to Paragraphs 4 and 6, the Shares of Restricted Stock awarded by this Agreement shall vest in accordance with the vesting provisions set forth on the first page of this Agreement. Shares of Restricted Stock shall not vest in the Employee in accordance with any of the provisions of this Agreement unless the Employee shall have been continuously employed by the Company or by one of its Affiliates from the Award Date until the date such vesting is deemed to have occurred. For purposes of this Agreement, “trading day” means any day on which the New York Stock Exchange is open for trade. For purposes of this Agreement, “Affiliate” means any corporation or any other entity (including, but not limited to, partnerships and joint ventures) controlling, controlled by, or under common control with the Company.

     4. Forfeiture. Notwithstanding any contrary provision of this Agreement, the balance of the Shares of Restricted Stock that have not vested at the time of the Employee’s Termination of Service shall thereupon be forfeited and automatically transferred to and reacquired by the Company at no cost to the Company. The Employee hereby appoints the Agent with full power of substitution, as the Employee’s true and lawful attorney-in-fact with irrevocable power and authority in the name and on behalf of the Employee to take any action and execute all documents and instruments, including, without limitation, stock powers which may be necessary to transfer the certificate or certificates (whether in book form or otherwise) evidencing such unvested Shares to the Company upon such Termination of Service. For purposes of this Agreement, “Termination of Service” means a cessation of the employee-employer relationship between the Employee and the Company or an Affiliate for any reason, including, but not by way of limitation, a termination by resignation, discharge, death, disability, retirement, or the disaffiliation of an Affiliate, but excluding any such termination where there is a simultaneous reemployment by the Company or an Affiliate.

     5. Death of Employee. Any distribution or delivery to be made to the Employee under this Agreement shall, if the Employee is then deceased, be made to the Employee’s designated beneficiary, or if no beneficiary survives the Employee, to the administrator or executor of the Employee’s estate. Any designation of a beneficiary by the Employee shall be effective only if such designation is made in a form and manner acceptable to the Committee. Any transferee must furnish the Company with (a) written notice of his or her status as transferee, and (b) evidence satisfactory to the Company to establish the validity of the transfer and compliance with any laws or regulations pertaining to said transfer.

     6. Change in Control and other Acceleration. In the event of a Change in Control, the Shares of Restricted Stock awarded pursuant to this Agreement shall vest as to 100% of the Shares. Further, the Committee in its absolute discretion at any time may accelerate the vesting of all or any portion of the Shares of Restricted Stock awarded pursuant to this Agreement. If so accelerated, such Shares will be considered as having vested as of the date specified by the Committee.

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     7. Withholding of Taxes. Notwithstanding any contrary provision of this Agreement, the Company may delay delivery of any stock unless and until the Employee shall have delivered to the Company or its designated Affiliate the full amount of any federal, state or local income or other taxes which the Company or such Affiliate may be required by law to withhold with respect to such Shares. The Employee may elect to satisfy any such income tax withholding requirement by having the Company withhold Shares of Common Stock otherwise deliverable to the Employee or by delivering to the Company already-owned Shares of Common Stock, subject to the absolute discretion of the Committee to disallow satisfaction of such withholding by the delivery or withholding of stock. The number of Shares withheld pursuant to the prior sentence will be rounded up to the nearest whole Share, with no refund for any value of the Shares withheld in excess of the tax obligation as a result of such rounding.

     8. Rights as Stockholder. Effective as of the Award Date, the Employee shall have all of the rights or privileges of a stockholder of the Company in respect of the Restricted Stock, including with respect to voting such Shares and receipt of dividends and distributions on such Shares. If any such dividends or distributions are paid in Shares of Company Common Stock, the Shares shall be subject to the same restrictions on transferability and forfeitability as the Shares of Restricted Stock with respect to which they were paid.

     9. No Effect on Employment. Subject to any employment contract with the Employee, the terms of such employment shall be determined from time to time by the Company, or the Affiliate employing the Employee, as the case may be, and the Company, or the Affiliate employing the Employee, as the case may be, shall have the right, which is hereby expressly reserved, to terminate or change the terms of the employment of the Employee at any time for any reason whatsoever, with or without good cause. The transactions contemplated hereunder and the vesting schedule set forth herein do not constitute an express or implied promise of continued employment for any period of time. A leave of absence or an interruption in service (including an interruption during military service) authorized or acknowledged by the Company, or the Affiliate employing the Employee, as the case may be, shall not be deemed a Termination of Service for the purposes of this Agreement.

     10. Tax Consequences. Set forth below is a brief summary, as of the Award Date, of some of the federal tax consequences arising from the award of Shares of Restricted Stock and disposition of such Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.

     (a) Award of Shares of Restricted Stock. Generally, no income will be recognized by the Employee in connection with the award of unvested Shares of Restricted Stock. Generally, as the Shares vest, the Employee will recognize compensation income in an amount equal to the difference between the fair market value of the Shares of Restricted Stock at the time the Shares vest and the amount paid for the stock, if any (the “Spread”). Generally, the Spread will be subject to tax withholding by the Company, and the Company will be entitled to a tax deduction in the amount at the time the Employee recognizes compensation income with respect to Shares of Restricted Stock.

     (b) Disposition of Shares. Upon disposition of the Shares of Restricted Stock, any gain or loss is treated as capital gain or loss. If the Shares are held for at least one year, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. Long-term capital gains are grouped and netted by holding periods. Net capital gains on assets held for more than 12 months is currently capped at 15%. As of the date of this Agreement, capital losses are allowed in full against capital gains, and up to $3,000 against other income.

     11. Address for Notices. Any notice to be given to the Company under the terms of this Agreement shall be addressed to the Company, in care of its Secretary, at 56 Top Gallant Road, Stamford, CT 06904 or at such other address as the Company may hereafter designate in writing.

     12. Award is Not Transferable. Except as provided in Paragraph 5 above, until the applicable Shares of Restricted Stock vest this award and the rights and privileges conferred hereby shall not be sold, transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) and shall not be subject to sale under execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this award, or of any right or privilege conferred hereby, or upon any attempted sale under any execution, attachment or similar process, this award and the rights and privileges conferred hereby immediately shall become null and void. If

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the Employee effects any action in contravention of this Paragraph 13, any provision of this Agreement to the contrary notwithstanding, the Restricted Stock at issue shall immediately be forfeited to the Company.

     13. Restrictions on Sale of Securities. The Shares issued as payment for vested Restricted Stock awarded under this Agreement will be registered under U. S. federal securities laws and will be freely tradable upon receipt. However, the Employee’s subsequent sale of the Shares may be subject to any market blackout-period that may be imposed by the Company and must comply with the Company’s insider trading policies, and any other applicable securities laws.

     14. Binding Agreement. Subject to the limitation on the transferability of this award contained herein, this Agreement shall be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the parties hereto.

     15. Conditions for Transfer of Stock. The Shares of stock deliverable to the Employee may be either previously authorized but unissued Shares or issued Shares that have been reacquired by the Company. The Company shall not be required to transfer on its books or listed in street name with a brokerage company any Shares of Restricted Stock prior to fulfillment of all the following conditions: (a) the admission of such Shares to listing on all stock exchanges on which such class of stock is then listed; (b) the completion of any registration or other qualification of such Shares under any State or Federal law or under the rulings or regulations of the Securities and Exchange Commission or any other governmental regulatory body, which the Committee shall, in its absolute discretion, deem necessary or advisable; (c) the obtaining of any approval or other clearance from any State or Federal governmental agency, which the Committee shall, in its absolute discretion, determine to be necessary or advisable; and (d) the lapse of such reasonable period of time following the Award Date as the Committee may establish from time to time for reasons of administrative convenience.

     16. Plan Governs/Defined Terms. This Agreement is subject to all the terms and provisions of the Plan. In the event of a conflict between one or more provisions of this Agreement and one or more provisions of the Plan, the provisions of the Plan will govern. Capitalized terms used and not defined in this Agreement will have the meaning set forth in the Plan.

     17. Committee Authority. The Committee shall have the power to interpret this Agreement and to adopt such rules for the administration, interpretation and application of this Agreement as are consistent therewith and to interpret or revoke any such rules. All actions taken and all interpretations and determinations made by the Committee in good faith shall be final and binding upon the Employee, the Company and all other interested persons. No member of the Committee shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or this Agreement. In its absolute discretion, the Board may at any time and from time to time exercise any and all rights and duties of the Committee under the Plan and this Agreement.

     18. Captions. Captions provided herein are for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.

     19. Agreement Severable. In the event that any provision in this Agreement shall be held invalid or unenforceable, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on, the remaining provisions of this Agreement.

     20. Governing Law. This Agreement shall be construed in accordance with and governed by the laws of the State of Connecticut, other than its conflicts of laws provisions.

     21. Modifications to the Agreement. This Agreement constitutes the entire understanding of the parties on the subjects covered. The Employee expressly warrants that he or she is not executing this Agreement in reliance on any promises, representations, or inducements other than those contained herein. Modifications to this Agreement can be made only in an express written contract executed by a duly authorized officer of the Company.

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     22. Amendment, Suspension or Termination of the Plan. By accepting this Restricted Stock award, the Employee expressly warrants that he or she has received a Restricted Stock award under the Plan, and has received, read and understood a description of the Plan. The Employee understands that the Plan is discretionary in nature and may be amended, suspended or terminated by the Company at any time.

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Exhibit 31.1

CERTIFICATION

     I, Eugene A. Hall, certify that:

     (1) I have reviewed this Quarterly Report on Form 10-Q of Gartner, Inc.;

     (2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

     (3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

     (4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d –15(f) for the registrant and have:

	a)		Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)		Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c)		Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
	d)		Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

     (5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

	a)		All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b)		Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Eugene A. Hall
Eugene A. Hall
Chief Executive Officer
November 9, 2005

Exhibit 31.2

CERTIFICATION

     I, Christopher Lafond, certify that:

     (1) I have reviewed this Quarterly Report on Form 10-Q of Gartner, Inc.;

     (2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

     (3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

     (4) The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d –15(f) for the registrant and have:

	a)		Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)		Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c)		Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation; and
	d)		Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

     (5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors:

	a)		All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b)		Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

/s/ Christopher Lafond
Christopher Lafond
Chief Financial Officer
November 9, 2005

Exhibit 32

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     In connection with the Quarterly Report of Gartner, Inc. (the “Company”) on Form 10-Q for the quarterly period ended September 30, 2005, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), as Chief Executive Officer of the Company and Chief Financial Officer of the Company, each hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Eugene A. Hall

Name: Eugene A. Hall
Title: Chief Executive Officer
Date: November 9, 2005

/s/ Christopher Lafond

Name: Christopher Lafond
Title: Chief Financial Officer
Date: November 9, 2005

A signed original of this written statement required by Section 906 has been provided to Gartner, Inc. and will be retained by Gartner, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.