Thank you, and hello, everyone. Thanks for joining today's call. Earlier this afternoon, we issued our press release for the second quarter of 2022. If you need a copy, you can find one on our website in the Investors section. .

I'm joined this afternoon by our Chairman of the Board and CEO, George Colony; and Forrester's Chief Financial Officer, Chris Finn. George will open the call this afternoon, and Chris will follow with a financial update. We'll then go into Q&A.

Kelley Hippler, Chief Sales Officer; and Carrie Johnson, Chief Product Officer, will also join us for the Q&A portion of the call. . Before we begin, I'd like to remind you that this call will contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

Words such as expects, believes, anticipates, intends, plans, estimates or similar expressions are intended to identify these forward-looking statements.

These statements are based on the company's current plans and expectations and involve risks and uncertainties that could cause future activities and results of operations to be materially different from those set forth in the forward-looking statements.

Factors that could cause actual results to differ are discussed in our reports and filings with the Securities and Exchange Commission, and the company undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

Lastly, consistent with our previous calls, today we will be discussing our performance on an adjusted basis, which excludes items affecting comparability.

While reporting on an adjusted basis is not in accordance with GAAP, we believe that reporting numbers on this adjusted basis provides a meaningful comparison and an appropriate basis for our discussion. You can find a detailed list of items excluded from these adjusted numbers in our press release. And with that, I'll hand it over to George..

one, higher-than-expected sales attrition and a slowness in hiring new sales reps; two, lower conversion rates driven by geopolitical and economic conditions; and three, higher-than-normal seat holder turnover in our client accounts.

Despite these factors, we expect to ramp our quota-carrying headcount in the second half and remain optimistic that we will meet our full year guidance for CV growth, EPS and profit margin. Forrester Decisions, our new flagship research product, continues on its growth path as we approach the 1-year anniversary of its launch.

We are seeing good enrichment deals. In the quarter, a large U.S. telecom company upgraded into Forrester Decisions, a CV increase of 55%. We also gained a large contract with the Department of the Canadian government for Forrester Decisions, and this was our first win since Forrester was added to the NMSO standing offer preferred vendor agreement.

We are continuously improving the Forrester Decisions platform. In August, we plan to expand Forrester Decisions from 15 services to 16 services, adding the digital business and strategy persona to the portfolio.

We designed the service for digital leaders, primarily B2C companies who are responsible for building exceptional digital experiences and increasing loyalty. In Q2, we added benchmarking to the platform.

Our clients expect to use benchmarks to pinpoint where they are lagging competitors, where they should target their future spending and where they should be trimming expense. Our benchmarks include global averages as well as metrics for specific vertical markets.

The Forrester Decisions platform offers a rich and diverse portfolio of research, and here are a few examples that stood out in the quarter. Our U.S. tech labor market forecast revealed that there has been a substantial migration of talent out of Silicon Valley in Northeastern metro centers to Southern states.

We released the 2022 North America Customer Experience Index of 300 brands, revealing the largest drop in customer experience quality in the history of the benchmark. The pandemic induced innovation and CX improvements decelerated, and companies failed to keep pace with the heightened expectations of consumers.

And this is important because small changes in CX index scoring are an early indicator of revenue change for companies. As an example, a one point drop in the CX Index score for a mass market auto manufacturer a $1.2 billion loss in revenue.

We are diligently working to ensure that our research is relevant to our clients as they manage supply chain imbalances, inflationary pressures and threats of recession. Disruption and digital challenges continue to make this the golden age of research. Now as I mentioned earlier, our events business is recovering from the pandemic.

We returned to a hybrid format in Q2 with our two biggest events of the year, the B2B North America Summit and Customer Experience North America; and two global events, CX EMEA and CX Asia Pacific. C-level attendance grew 20% for the B2B Summit and 30% for CX North America.

Attending ticket selling prices grew 25% from 2021 to 2022, and we recorded high attendee satisfaction scores in all regions and in all events in the second quarter. Average sponsor renewals for next year's events grew 35%, and global sponsor deals are up 100% for next year.

And my personal favorite part of our Q2 events was the sixth time Grammy nominee Black Pumas concert in Austin. It was wonderful to see our clients celebrate being together and celebrating a return to normalcy. Now before I conclude, I would like to take a moment to provide a quick update on Forrester's ESG initiatives.

As noted on our previous call, Forrester aims to cut carbon emissions 50% by 2025. Our anywhere work strategy will help us achieve this goal, and we are also assessing our travel policies and are migrating more of our tech platforms and services to the cloud to further reduce emissions.

I will now turn the call over to Chris Finn, Forrester's CFO, who will give you a financial update.

Chris?.

one, the strengthening dollar will continue to put pressure on our top line; two, as mentioned, we do have head count challenges that are affecting our top line results as well. We have a strong pipeline of talent but are finding our lead time to hire new employees longer than expected, largely driven by what continues to be a tight labor market.

Further, while attrition has improved from the highs of last year, it remains elevated. Three, our sales cycle, given the environment our clients find themselves in, specifically our European clients, we are seeing longer sales cycles and lower conversion, which is also adding pressure to our top line.

With that said, we've made progress on our sales resource hiring and currently have a record number of ramping sales heads this period. As we increased our ramp sales headcount in the second half, we fully believe we can execute and deliver on double-digit CV growth this year as planned.

However, given the slow start in our Q2 bookings and the pacing of bookings in the second half as headcount ramps, we expect revenue recognition to be delayed commensurately with bookings. In addition, as I already mentioned, FX and the macroeconomic landscape are also likely to pressure our top line results in the second half.

But despite our guide down on the top line, we remain confident in our ability to manage the P&L and deliver on our margin and EPS guidance that we issued at the beginning of the year. Let me provide some additional color for the third quarter and balance of the year starting with the top line.

For the full year, we continue to expect that FX will be approximately a 1% to 2% headwind to the business with an insignificant effect on operating margin. In our research business, for the third quarter, we expect mid- to high single-digit revenue growth.

And for the full year, we expect high single to low double-digit growth based on our projected CV bookings for 2022. For our consulting business, we expect revenue to be low to mid-single-digit growth for the third quarter and low single digits for the full year.

Finally, for our events business, our revenue guidance continues to include the assumptions that we will be able to hold hybrid events during the year, which is highly dependent on local conditions in each of the cities where we hold events across the globe. We are carefully monitoring the new COVID variant and will adjust as necessary.

But the events we have held thus far this year have been very successful. Given all of this, we expect third quarter revenues to increase by 190% to 200% compared to prior year, and we expect event revenues for the full year to approximately double our results from 2021.

Putting all those factors together for the full business, we would now expect total revenue of approximately $125 million to $129 million in the third quarter. And for the full year, we expect total revenue to be $535 million to $545 million. In terms of other guidance, in the third quarter of 2022, we expect our operating margin to be 8% to 10%.

We continue to expect our full year operating margin to be 11.5% to 12.5% given additional cost controls and focused investment initiatives. We also continue to expect interest expense at $2.5 million for the year as our lower debt balance should offset expected increases in rates.

In the third quarter and for the full year of 2022, we continue to expect an effective tax rate of 30%. Finally, for the third quarter, we expect our EPS to be in a range of $0.35 to $0.41, and we continue to hold our guidance for the full year in the range of $2.25 to $2.35. We remain cautiously optimistic about the months ahead.

While there are still many macro headwinds, both geopolitical and economic, we are confident in what we have laid out today and the shareholder value we look to create going forward. With that, let me hand it back to George for some concluding remarks before Q&A..

One, Forrester will continue to grow and improve Forrester decisions; two, we will navigate our economic and transition headwinds; and three, we expect to continue to grow CV at double-digit rates. .

Forrester has encountered a number of recessions and economic disruptions over decades of operation, and I'm confident that the company will manage whatever conditions that develop over the coming months. At our company meeting last week, we talked about doubling down on our client focus.

Thank you to our Forrester teams for being on the side and by the side of our clients. This is even more critical in challenging times. Thank you for listening to the call, and I will now turn the call over to the operator for questions..

Our first question comes from Andrew Nicholas with William Blair..

This is actually Trevor on for Andrew. Just wanted to see if you could kind of elaborate a bit more on the macro uncertainty piece. I know you mentioned kind of lower conversion rates and some sales cycles extending.

Are you seeing any signs of clients actually starting to kind of actively pull back or cancel subscriptions at this point? Or is it kind of just those factors? And are any of those dynamics kind of concentrated in a particular customer segment? Or is it kind of fairly broad-based across the customer base?.

Trevor, it's Kelley Hippler here. Thank you for the question. So in terms of the softness that we're seeing, a lot of it has been centralized a little bit more so in Europe than in other places, so -- which is not unusual given the war that is going on over there.

And then the drop in conversion rate, as Chris alluded to, we are seeing some longer sales cycles but are confident that a lot of that business, we will still win during the course of the year..

Okay. Great. And then I know you mentioned you still expect to hit the CV growth target for the year. Just wondering if you could go a bit deeper there since there was a bit of deceleration relative to the past few quarters.

Just wondering if you could kind of talk about some of the factors like new logos, new seats per client and pricing or anything else, which of those kind of decelerated a bit this quarter? And how would you expect that to play out the rest of the year, would expect to hit the double-digit growth even if the macro does get worse from here?.

Sure, Trevor. Kelley again here. And what I would say is I think our biggest challenge from a performance perspective was just the number of ramp reps that we had out in the field. So we have a record number of sales reps that are going to be coming off of ramp in this quarter.

And so a lot of what we saw from a metrics perspective was just driven by not having as many folks out in the field as we were anticipating. We continue to see good wallet retention on the Forrester Decisions portfolio and still continue to see a little bit of noise with some of our legacy products..

And Trevor, George here. I'd say much more confidence comes from the velocity we're seeing in Forrester Decisions. It is on track, on plan, and this product is performing well..

Got it. That is good to hear..

Our next question comes from the line of Vincent Colicchio with Bernstein..

Yes. I'm curious with your CV pipeline. You had mentioned that the bookings for CV improved in June. Curious what your pipeline looks like right now versus this period last quarter..

Vince, sure. It's Kelley here. I will take that one. So in terms of pipeline for Q3, we are starting Q3 from a better position than we started Q2, and part of that as well has been our strategy with Forrester Decisions to sign multiyear deals. So as you might recall, we launched that product last August.

And from there forward, about 70% of the Forrester Decisions deals that we sold were multiyear deals. So the good news is we walk into Q3 and Q4 with more of our business already booked than we have previously. And then in addition to that, we've got ramping reps. So our pipeline is in better shape going into Q3 than it was going into Q2..

And did I hear that you're on track for your previously committed sales growth goal? And if so, are you assuming attrition levels decline from where they are currently in the next 2 quarters? ..

Yes, so we are on pace to not only get to our original targets for 2022, but we've actually started to proactively hire for 2023 to help make up some of the ground from the attrition that we saw in Q2.

So we expect to add double-digit headcount throughout the course of the year to not only help us get to our goals for 2022 but to keep us at double-digit CV growth as we head into 2023. ..

And the attrition, was it highly concentrated with more senior people? What does the distribution look like?.

Sure, Vince. So in terms of the distribution, I would say it was some of our more senior reps who decided to opt out of Forrester with some of the change in strategy, coupled with a very hot job market that made it lucrative for them to do so.

But the good news is for those folks who are joining Forrester, they are coming into Forrester understanding and knowing about our change in strategy to focus on CV, how we want to be working with our clients on their side and by their side.

So the new hires are fully bought into the model and where we're going and how that's going to help add more value for our clients moving forward. ..

And I think last quarter, you had talked about improving the ramp time for new reps. You indicated you could reduce it from 1 year to 9 months.

Are you at that -- are you seeing that?.

We are on pace for that, which, again, given some of the delays that we saw in hiring, we'll put some of this production capacity at the back end of Q3 into Q4, but we are definitely seeing that the Forrester Decisions portfolio makes it much easier to either qualify or disqualify potential opportunities for the sales force.

So it's -- we do expect to see ramp time continue to come down. ..

That concludes today's question-and-answer session. I'd like to turn the call back to management for closing remarks..

Thank you, everyone, for joining us today. This is Tyson. I will be around in the coming weeks if there are any follow-up questions. I hope everyone has a great rest of their summer. Thank you..

This concludes today's conference call. Thank you for participating. You may now disconnect..