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Operating Segments
 9 Months Ended
Sep. 30, 2014
Segment Reporting [Abstract]  
Operating Segments

Note 9 — Operating Segments

At the end of 2013 the Company reorganized its fulfillment organization into a single global research organization and a single global product organization to better support its client base by facilitating better research collaboration and quality, promoting a more uniform client experience and improved customer satisfaction, and encouraging innovation. During 2013 the Company also established a dedicated consulting organization to provide research-based project consulting services to its clients, allowing the Company’s research personnel to spend additional time on writing research and providing shorter-term advisory services. As of January 1, 2014 the Company conformed its internal reporting to match the new organizational structure and as such is reporting segment information for the newly formed Research, Product and Project Consulting organizations. The 2013 segment amounts have been reclassified to conform to the current presentation.

The Research segment includes the costs of the Company’s research personnel who are responsible for writing the research and performing the webinars and inquiries for the Company’s RoleView product. In addition, the research personnel deliver advisory services (such as workshops, speeches and advisory days) and a portion of the Company’s project consulting services. Revenue in this segment includes only revenue from advisory services and project consulting services that are delivered by the research personnel in this segment. During 2013, the Company began to transition the delivery of project consulting to a dedicated project consulting organization. The Company anticipates that the transition will be complete by the end of 2014 such that essentially all project consulting will be delivered by the project consulting organization in 2015.

The Product segment includes the costs of the product management organization that is responsible for pricing, packaging and the launch of new products. In addition, this segment includes the costs of the Company’s data, Forrester Leadership Boards and events organizations. Revenue in this segment includes all revenue for the Company (including RoleView) except for revenue from advisory services and project consulting services that are delivered by personnel in the Research and Project Consulting segments.

The Project Consulting segment includes the costs of the consultants that deliver the Company’s project consulting services. During 2013 the Company began to hire dedicated consultants to transition the delivery of project consulting services from research personnel (included in the Research segment) to the new Project Consulting segment. Revenue in this segment includes the project consulting revenue delivered by the consultants in this segment.

The Company evaluates reportable segment performance and allocates resources based on segment revenues and expenses. Segment expenses include the direct expenses of each segment organization and exclude selling and marketing expenses, general and administrative expenses, stock-based compensation expense, depreciation expense, adjustments to incentive bonus compensation from target amounts, amortization of intangible assets, reorganization costs, other income and gains (losses) on investments. The accounting policies used by the segments are the same as those used in the consolidated financial statements.

 

                  Project         
     Products      Research     Consulting      Consolidated  

Three Months Ended September 30, 2014

           

Research services revenues

    $ 50,622       $ —        $ —         $ 50,622   

Advisory services and events revenues

      2,310         10,925        11,506         24,741   
  

 

 

     

 

 

    

 

 

     

 

 

  

Total segment revenues

      52,932         10,925        11,506         75,363   

Segment expenses

      8,298         13,012        7,590         28,900   
  

 

 

     

 

 

    

 

 

     

 

 

  

Contribution margin (loss)

      44,634         (2,087 )      3,916         46,463   

Selling, marketing, administrative and other expenses

              (41,079 ) 

Amortization of intangible assets

              (530 ) 

Reorganization credits

              71   

Other income and gains (losses) on investments

              127   
          

 

 

  

Income before income taxes

            $ 5,052   
          

 

 

  

 

                  Project         
     Products      Research     Consulting      Consolidated  

Three Months Ended September 30, 2013

           

Research services revenues

    $ 49,855       $ —        $ —         $ 49,855   

Advisory services and events revenues

      2,167         12,781        5,012         19,960   
  

 

 

     

 

 

    

 

 

     

 

 

  

Total segment revenues

      52,022         12,781        5,012         69,815   

Segment expenses

      7,408         14,420        4,196         26,024   
  

 

 

     

 

 

    

 

 

     

 

 

  

Contribution margin (loss)

      44,614         (1,639 )      816         43,791   

Selling, marketing, administrative and other expenses

              (38,933 ) 

Amortization of intangible assets

              (557 ) 

Reorganization costs

              —     

Other income and gains (losses) on investments

              (53 ) 
          

 

 

  

Income before income taxes

            $ 4,248   
          

 

 

  
                  Project         
     Products      Research     Consulting      Consolidated  

Nine Months Ended September 30, 2014

           

Research services revenues

    $ 153,737       $ —        $ —         $ 153,737   

Advisory services and events revenues

      15,161         37,573        24,910         77,644   
  

 

 

     

 

 

    

 

 

     

 

 

  

Total segment revenues

      168,898         37,573        24,910         231,381   

Segment expenses

      28,543         40,386        19,705         88,634   
  

 

 

     

 

 

    

 

 

     

 

 

  

Contribution margin (loss)

      140,355         (2,813 )      5,205         142,747   

Selling, marketing, administrative and other expenses

              (127,300 ) 

Amortization of intangible assets

              (1,605 ) 

Reorganization costs

              (1,817 ) 

Other income and gains (losses) on investments

              222   
          

 

 

  

Income before income taxes

            $ 12,247   
          

 

 

  
                  Project         
     Products      Research     Consulting      Consolidated  

Nine Months Ended September 30, 2013

           

Research services revenues

    $ 151,445       $ —        $ —         $ 151,445   

Advisory services and events revenues

      13,868         42,531        12,285         68,684   
  

 

 

     

 

 

    

 

 

     

 

 

  

Total segment revenues

      165,313         42,531        12,285         220,129   

Segment expenses

      25,902         43,006        11,169         80,077   
  

 

 

     

 

 

    

 

 

     

 

 

  

Contribution margin (loss)

      139,411         (475 )      1,116         140,052   

Selling, marketing, administrative and other expenses

              (119,108 ) 

Amortization of intangible assets

              (1,670 ) 

Reorganization costs

              (1,905 ) 

Other income and gains (losses) on investments

              476   
          

 

 

  

Income before income taxes

            $ 17,845