Forrester Research Reports First-Quarter Financial Results

Cambridge, Mass. - Forrester Research, Inc. (Nasdaq: FORR) today announced its first-quarter ended March 31, 2010 financial results.

First-Quarter Financial Performance

* Total revenues were $59.2 million, compared with $56.4 million for the first quarter of last year.
* On a GAAP-reported basis, Forrester reported net income of $5.8 million, or $0.25 per diluted share, compared with net income of $2.6 million, or $0.11 per diluted share, for the same period last year.
* On a pro forma basis, net income was $6.3 million, or $0.28 per diluted share, for the first quarter of 2010, which reflects a pro forma effective tax rate of 40 percent. Pro forma net income excludes stock-based compensation of $1.1 million, amortization of $0.9 million of acquisition-related intangible assets, $0.3 million of acquisition-related credits and net investment gains of $0.4 million. This compares with pro forma net income of $6.3 million, or $0.27 per diluted share, for the same period in 2009, which reflects a pro forma effective tax rate of 40 percent. Pro forma net income for the first quarter of 2009 excludes stock-based compensation of $2.2 million, amortization of $0.7 million of acquisition-related intangible assets and $3.1 million of reorganization costs.

A reconciliation of GAAP results to pro forma results may be found in the attached financial tables.

“On the heels of a good fourth quarter last year, we have followed with a strong first quarter this year,” said George F. Colony, Forrester’s chairman of the board and chief executive officer. “We finished in the upper end of our revenue guidance and surpassed our expectations for earnings and operating margin in the first quarter. Renewal rates have returned to pre-recession levels, deferred revenue is 8.5 percent higher than the same period one year ago, and we continue to expand our sales force to increase market penetration of our role-based products and services. We are off to a very good start in a year of economic recovery.”

Forrester is providing second-quarter 2010 financial guidance as follows:

Second-Quarter 2010 (GAAP):

* Total revenues of approximately $63.5 million to $66.5 million.
* Operating margin of approximately 15.5% to 17.5%.
* Other income of approximately $250,000.
* An effective tax rate of 40%.
* Diluted earnings per share of approximately $0.26 to $0.31.

Second-Quarter 2010 (Pro Forma):

Pro forma financial guidance for the second quarter of 2010 excludes estimated stock-based compensation of $1.0 million to $1.2 million, estimated amortization of acquisition-related intangible assets of approximately $0.9 million, and any gains or losses related to marketable and non-marketable investments.

* Pro forma operating margin of approximately 18.5% to 20.5%.
* Pro forma effective tax rate of 40%.
* Pro forma diluted earnings per share of approximately $0.32 to $0.36.

Forrester is reiterating full-year 2010 guidance as follows:

Full-Year 2010 (GAAP):

* Total revenues of approximately $240 million to $248 million.
* Operating margin of approximately 11% to 12%.
* Other income of approximately $1.0 million.
* An effective tax rate of 40%.
* Diluted earnings per share of approximately $0.72 to $0.78.

Full-Year 2010 (Pro Forma):

Pro forma financial guidance for full-year 2010 excludes estimated stock-based compensation expense of $5.0 million to $6.0 million, estimated amortization of acquisition-related intangible assets of approximately $3.6 million, and any gains or losses related to marketable and non-marketable investments.

* Pro forma operating margin of approximately 14.5% to 15.5%.
* Pro forma effective tax rate of 40%.
* Pro forma diluted earnings per share of approximately $0.97 to $ 1.03.

About Forrester Research

Forrester Research (Nasdaq: FORR) is an independent research company that provides pragmatic and forward-thinking advice to global leaders in business and technology. Forrester works with professionals in 19 key roles at major companies providing proprietary research, customer insight, consulting, events, and peer-to-peer executive programs. For more than 26 years, Forrester has been making IT, marketing, and technology industry leaders successful every day. For more information, visit www.forrester.com.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, Forrester’s financial guidance for the second quarter of and full-year 2010. These statements are based on Forrester’s current plans and expectations and involve risks and uncertainties that could cause actual future activities and results of operations to be materially different from those set forth in the forward-looking statements. Important factors that could cause actual future activities and results to differ include, among others, Forrester’s ability to respond to business and economic conditions, technology spending, market trends, competition, industry consolidation, the ability to attract and retain professional staff, possible variations in Forrester’s quarterly operating results, any cost savings related to reductions in force and associated actions, risks associated with Forrester’s ability to offer new products and services, and Forrester’s dependence on renewals of its membership-based research services and on key personnel. Forrester undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise. For further information, please refer to Forrester’s reports and filings with the Securities and Exchange Commission.