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

The purpose of this Management’s Discussion and Analysis (“MD&A”) is to facilitate an understanding of significant factors influencing the quarterly operating results, financial condition and cash flows of Gartner, Inc. Additionally, the MD&A 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 Quarterly Report on Form 10-Q and our Annual Report on Form 10-K for the year ended December 31, 2021 (the “2021 Form 10-K”). Historical results and percentage relationships are not necessarily indicative of operating results for future periods. References to “Gartner,” the “Company,” “we,” “our” and “us” in this MD&A are to Gartner, Inc. and its consolidated subsidiaries.

FORWARD-LOOKING STATEMENTS

In addition to historical information, this Quarterly Report on Form 10-Q contains certain 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, projections or strategies regarding the future. In some cases, forward-looking statements can be identified by the use of words such as “may,” “will,” “expect,” “should,” “could,” “believe,” “plan,” “anticipate,” “estimate,” “predict,” “potential,” “continue” or other words of similar meaning.

We operate in a very competitive and rapidly changing environment that involves numerous known and unknown risks and uncertainties, some of which are beyond our control. Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future quarterly and annual revenues, operating income, results of operations and cash flows, as well as any forward-looking statement, are subject to change and to inherent risks and uncertainties, such as those disclosed or incorporated by reference in our filings with the Securities and Exchange Commission. Important factors that could cause our actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in our forward-looking statements include, among others, the following: the impact of the COVID-19 pandemic and related disruptions on our business and on the global economy; the adequacy or effectiveness of steps we take to respond to the pandemic; our ability to recover potential claims under our event cancellation insurance; the timing of conferences and meetings, in particular our Gartner Symposium/Xpo series that normally occurs during the fourth quarter, as well as the timing of our return to in-person conferences and meetings and willingness of participants to attend; our ability to achieve and effectively manage growth, including our ability to integrate our acquisitions and consummate and integrate future acquisitions; our ability to pay our debt obligations; our ability to maintain and expand our products and services; our ability to expand or retain our customer base; our ability to grow or sustain revenue from individual customers; our ability to attract and retain a professional staff of research analysts and consultants as well as experienced sales personnel upon whom we are dependent, especially in light of recent labor shortages; our ability to achieve continued customer renewals and achieve new contract value, backlog and deferred revenue growth in light of competitive pressures; our ability to carry out our strategic initiatives and manage associated costs; our ability to successfully compete with existing competitors and potential new competitors; our ability to enforce and protect our intellectual property rights; additional risks associated with international operations, including foreign currency fluctuations; the impact on our business of the war in Ukraine and current and future sanctions imposed by governments or other authorities; the U.K.’s exit from the European Union and its impact on our results; the impact of restructuring and other charges on our businesses and operations; cybersecurity incidents; general economic conditions; changes in macroeconomic and market conditions and market volatility, including interest rates and the effect on the credit markets and access to capital; risks associated with the creditworthiness, budget cuts, and shutdown of governments and agencies; the impact of changes in tax policy and heightened scrutiny from various taxing authorities globally; uncertainty from the discontinuance of LIBOR and transition to any other interest rate benchmark; changes to laws and regulations; and other risks and uncertainties detailed in this Form 10-Q, our most recent Form 10-K and other filings we make with the SEC. 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. A description of the risk factors associated with our business is included under “Risk Factors” in Item 1A. of the 2021 Form 10-K, which is incorporated herein by reference.

Forward-looking statements are subject to risks, estimates 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 listed above or described under “Risk Factors” in Item 1A of the 2021 Form 10-K. 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. Forward-looking statements in this Quarterly Report on Form 10-Q speak only as of the date hereof, and

forward-looking statements in documents attached that are incorporated by reference speak only as of the date of those documents. 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.

BUSINESS OVERVIEW

Gartner, Inc. (NYSE: IT) delivers actionable, objective insight to executives and their teams. Our expert guidance and tools enable faster, smarter decisions and stronger performance on an organization’s mission critical priorities.

We deliver our products and services globally through three segments – Research, Conferences and Consulting, as described below.

• Research** equips executives and their teams from every function and across all industries with actionable, objective insight, guidance and tools. Our experienced experts deliver all this value informed by an unmatched combination of practitioner-sourced and data-driven research to help our clients address their mission critical priorities.

• Conferences** provides executives and teams across an organization the opportunity to learn, share and network. From our Gartner Symposium/Xpo series, to industry-leading conferences focused on specific business roles and topics, to peer-driven sessions, our offerings enable attendees to experience the best of Gartner insight and guidance.

• Consulting** serves senior executives leading technology-driven strategic initiatives leveraging the power of Gartner’s actionable, objective insight. Through custom analysis and on-the-ground support we enable optimized technology investments and stronger performance on our clients’ mission critical priorities.

Recent Global Events

The invasion of Ukraine by Russia and the sanctions and other measures being imposed in response to this conflict have increased the level of economic and political uncertainty. In March 2022, we began winding down our business in Russia. Russia has not composed a material portion of our consolidated revenues, net income, net assets or workforce. We do not have a business in Ukraine. Other impacts due to this rapidly evolving situation are currently unknown and could subject our business to materially adverse consequences should the situation escalate or cause an expansion of economic disruption beyond its current scope to the rest of Europe, where a material portion of our business is carried out. A prolonged disruption may adversely affect our business operations, financial performance and results of operations.

COVID-19 Impact

As a result of the COVID-19 pandemic, we temporarily closed Gartner offices around the world and implemented significant travel restrictions. Although all Gartner offices have reopened, the vast majority of our employees have been working from home. In early 2022, we began to operate under a hybrid virtual-first working environment, meaning that most of our employees will have the option to work remotely at least some of the time, for the foreseeable future. As a result, in the fourth quarter of 2021 we evaluated our real estate footprint globally, and determined that certain of our leased locations are no longer necessary for our operations. This evaluation resulted in the impairment of right-of-use assets and other long-lived assets, net of a reduction in lease liabilities, of $49.5 million related to certain office locations we no longer intend to use. We continued our evaluation during the three months ended March 31, 2022, which resulted in an additional impairment charge of $23.9 million. We expect to continue to evaluate our real estate footprint globally. If we determine there is any additional excess property, there is no assurance that we will be able to sublease any such excess properties or that we will not incur costs in connection with such exit activities, which may be material. As of the date of this filing, we do not believe our hybrid virtual-first working arrangement has affected our internal controls over financial reporting.

Of the three business segments in which we operate, Research and Consulting have returned to growth levels that were in line with our growth prior to the pandemic. However, Conferences continues to be negatively impacted. We cancelled in-person conferences scheduled for 2020 beginning in late February/early March 2020 with the remainder being cancelled after the World Health Organization’s declaration of the COVID-19 pandemic later in March 2020. We began holding virtual conferences during the second half of 2020. We held 5 virtual conferences during the three months ended March 31, 2022 and expect to continue to deliver some conferences virtually during the remainder of the year. These virtual conferences have resulted in significantly less revenue and gross contribution than in-person conferences, but we believe they aid in client retention and engagement. We are planning to re-launch in-person destination conferences beginning in the second quarter of 2022 and expect to hold in-person destination conferences in future periods as conditions permit.

For cancelled conferences, our event cancellation insurance enables us to receive an amount up to expected revenues, plus incurred expenses minus saved expense. Our event cancellation insurance provides up to $170 million in coverage for 2020 with the right to reinstate that amount one time if those limits are utilized. The insurer has contested our right to reinstate limits. Gartner also has event cancellation insurance for 2021, covering events that were planned for 2021 but cancelled, of up to $150 million with the right to reinstate up to that amount one time if the initial limits are inadequate. The insurer has contested all coverage for events planned for 2021 but cancelled due to COVID-19. We are in litigation with the insurer on these issues. In 2021, we received $166.9 million of proceeds related to 2020 insurance claims, and recorded a gain of $152.3 million. The timing and ability to receive the remaining proceeds from 2020 and 2021 insurance claims is uncertain so we will not record any insurance claims in excess of expenses incurred related to the remaining claims until the receipt of the insurance proceeds is deemed to be realizable. Our insurance coverage for 2022 (and likely beyond) excludes cancellation due to communicable diseases.

In response to the pandemic’s impacts to our business, we implemented cost avoidance initiatives in the first half of 2020 including significant limitations on hiring and third-party spending, reductions to discretionary spending and elimination of non-essential travel and re-prioritization of capital expenditures. We began to restore certain investments in the business during the second half of 2020 and accelerated these investments in 2021 and the three months ended March 31, 2022. We expect these investments to increase in future periods, which may have a negative impact on operating margins.

BUSINESS MEASUREMENTS

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

BUSINESS SEGMENT						BUSINESS MEASUREMENT
Research						Contract value represents the dollar value attributable to all of our subscription-related contracts. It is calculated as the annualized value of all contracts in effect at a specific point in time, without regard to the duration of the contract. Contract value primarily includes Research deliverables for which revenue is recognized on a ratable basis, as well as other deliverables (primarily Conferences tickets) for which revenue is recognized when the deliverable is utilized. Comparing contract value year-over-year not only measures the short-term growth of our business, but also signals the long-term health of our Research subscription business since it measures revenue that is highly likely to recur over a multi-year period. Our contract value consists of Global Technology Sales contract value, which includes sales to users and providers of technology, and Global Business Sales contract value, which includes sales to all other functional leaders.
						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. Client retention is calculated at an enterprise level, which represents a single company or customer.
						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 our current clients, who were also clients a year ago, by the contract value from a year ago, excluding the impact of foreign currency exchange. When wallet retention exceeds client retention, it is an indication of retention of higher-spending clients, or increased spending by retained clients, or both. Wallet retention is calculated at an enterprise level, which represents a single company or customer.
Conferences						Number of destination conferences represents the total number of hosted virtual or in-person conferences completed during the period. Single day, local meetings are excluded.
						Number of destination conferences attendees represents the total number of people who attend virtual or in-person conferences. Single day, local meetings are excluded.
Consulting						Consulting backlog represents future revenue to be derived from in-process consulting and measurement engagements.
						Utilization rate represents 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.

EXECUTIVE SUMMARY OF OPERATIONS AND FINANCIAL POSITION

The fundamentals of our strategy include a focus on creating actionable insights for executive leaders and their teams, delivering innovative and highly differentiated product offerings, building a strong sales capability, providing world class client service with a focus on client engagement and retention, and continuously improving our operational effectiveness.

We had total revenues of $1.3 billion during the first quarter of 2022, an increase of 14% compared to the first quarter of 2021. During the first quarter of 2022 revenues for Research increased by 16% year-over-year, Conferences revenue decreased by $14.4 million, and Consulting revenues increased by 17%. For a more complete discussion of our results by segment, see Segment Results below.

For the first quarter of 2022 and 2021, we had net income of $172.5 million and $164.1 million, respectively, and diluted income per share of $2.08 and $1.84, respectively. Cash provided by operating activities was $167.8 million and $157.3 million during the three months ended March 31, 2022 and 2021, respectively. As of March 31, 2022, we had $456.2 million of cash and cash equivalents and approximately $1.0 billion of available borrowing capacity on our revolving credit facility. For a more complete discussion of our cash flows and financial position, see the Liquidity and Capital Resources section below.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

For information regarding our critical accounting policies and estimates, please refer to Part II, Item 7, “Critical Accounting Policies and Estimates” contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. There have been no material changes to the critical accounting policies previously disclosed in that report.

RECENTLY ISSUED ACCOUNTING STANDARDS

The FASB has issued accounting standards that have not yet become effective and that may impact the Company’s consolidated financial statements or its disclosures in future periods. Note 1 — Business and Basis of Presentation in the Notes to Condensed Consolidated Financial Statements provides information regarding those accounting standards.

RESULTS OF OPERATIONS

Consolidated Results

In addition to GAAP results, we provide foreign currency neutral dollar amounts and percentages for our revenues, certain expenses, contract values and other metrics. These foreign currency neutral dollar amounts and percentages eliminate the effects of exchange rate fluctuations and thus provide a more accurate and meaningful trend in the underlying data being measured. We calculate foreign currency neutral dollar amounts by converting the underlying amounts in local currency for different periods into U.S. dollars by applying the same foreign exchange rates to all periods presented.

The table below presents an analysis of selected line items and period-over-period changes in our interim Condensed Consolidated Statements of Operations for the periods indicated (in thousands).

			Three Months Ended March 31, 2022						Three Months Ended March 31, 2021						Increase (Decrease)						Increase (Decrease) %
Total revenues			$	1,262,740					$	1,104,038					$	158,702					14		%
Costs and expenses:
Cost of services and product development			377,033						334,467						42,566						13
Selling, general and administrative			617,904						487,255						130,649						27
Depreciation			23,201						25,750						(2,549)						(10)
Amortization of intangibles			25,148						30,514						(5,366)						(18)
Acquisition and integration charges			2,207						640						1,567						245
Operating income			217,247						225,412						(8,165)						(4)
Interest expense, net			(31,394)						(26,149)						5,245						20
Other income, net			29,206						15,490						13,716						89
Less: Provision for income taxes			42,544						50,653						(8,109)						(16)
Net income			$	172,515					$	164,100					$	8,415					5		%

Total revenues for the three months ended March 31, 2022 were $1.3 billion, an increase of $158.7 million, or 14% compared to the same period in 2021 on a reported basis and 16% excluding the foreign currency impact. Refer to the section of this MD&A below entitled “Segment Results” for a discussion of revenues and results by segment.

Cost of services and product development was $377.0 million during the three months ended March 31, 2022, an increase of $42.6 million compared to the same period in 2021, or 13% on a reported basis and 14% excluding the foreign currency impact. The increase in Cost of services and product development was primarily due to increased compensation costs, research program expenses and conference related expenses. Cost of services and product development as a percent of revenues was 30% during both periods.

Selling, general and administrative (“SG&A”) expense was $617.9 million during the three months ended March 31, 2022, an increase of $130.6 million compared to the same period in 2021, or 27% on a reported basis and 29% excluding the foreign currency impact. The increase in SG&A expense was primarily due to higher personnel costs in the current year, specifically commission expense, following strong contract value growth in 2021, which gets amortized as the related revenue is recognized, and salary expense due to increased headcount. The increase in SG&A during the three months ended March 31, 2022, as compared to the prior fiscal year, was also due to charges associated with the impairment of right-of-use assets and other long-lived assets of $23.9 million related to certain office locations we no longer intend to use. The number of quota-bearing sales associates in Global Technology Sales increased by 0.6% to 3,009 and in Global Business Sales increased by 15.1% to 998 compared to March 31, 2021. On a combined basis, the total number of quota-bearing sales associates increased by 3.8% when compared to March 31, 2021. SG&A expense as a percent of revenues was 49% and 44% during the three months ended March 31, 2022 and 2021, respectively.

Depreciation decreased by 10% during the three months ended March 31, 2022, compared to the same period in 2021. The decrease for the three months ended March 31, 2022 was primarily due to a reduction in leasehold improvements deprecation as a result of the impairment losses recorded in the fourth quarter of 2021.

Amortization of intangibles decreased by 18% during the three months ended March 31, 2022 compared to the same periods in 2021 due to certain intangible assets that became fully amortized in 2021.

Acquisition and integration charges increased by $1.6 million during the three months ended March 31, 2022 compared to the same period in 2021.

Operating income was $217.2 million and $225.4 million during the three months ended March 31, 2022 and 2021, respectively. The decrease in operating income was primarily due to increased selling, general and administrative expenses.

Interest expense, net increased by $5.2 million during the three months ended March 31, 2022, compared to the same period in 2021. The increase was primarily due to an increase in outstanding debt, as a result of the issuance of the 2029 Notes in June 2021.

Other income, net for the periods presented herein included the net impact of foreign currency gains and losses from our hedging activities. During 2022, Other income, net also included a $29.9 million gain on de-designated interest rate swaps.

The provision for income taxes for the three months ended March 31, 2022 and 2021 was $42.5 million and $50.7 million, respectively. The effective income tax rate was 19.8% and 23.6% for the three months ended March 31, 2022 and 2021, respectively. The year-over-year decrease in the effective income tax rate was primarily due to the relative impact of tax benefits from stock-based compensation.

Net income for the three months ended March 31, 2022 and 2021 was $172.5 million and $164.1 million, respectively. Our diluted net income per share during the three months ended March 31, 2022 increased by $0.24 compared to the same period in 2021. The increase in net income during the three months ended March 31, 2022 was primarily the result of increased revenues, and the gain from de-designated interest rate swaps, partially offset by an increase in operating expenses.

SEGMENT RESULTS

We evaluate reportable segment performance and allocate resources based on gross contribution margin. Gross contribution is defined as operating income or loss excluding certain Cost of services and product development expenses, SG&A expenses, Depreciation, Amortization of intangibles, and Acquisition and integration charges. Gross contribution margin is defined as gross contribution as a percent of revenues.

Reportable Segments

The sections below present the results of the Company’s three reportable business segments: Research, Conferences and Consulting.

Research

			As Of And For The Three Months Ended March 31, 2022						As Of And For The Three Months Ended March 31, 2021						Increase (Decrease)						Percentage Increase (Decrease)
Financial Measurements:
Revenues (1)			$	1,136,380					$	979,732					$	156,648					16		%
Gross contribution (1)			$	849,379					$	724,372					$	125,007					17		%
Gross contribution margin			75		%				74		%				1 point						—
Business Measurements:
Global Technology Sales (2):
Contract value (1), (3)			$	3,346,000					$	2,927,000					$	419,000					14		%
Client retention			86		%				83		%				3 points						—
Wallet retention			107		%				98		%				9 points						—
Global Business Sales (2):
Contract value (1), (3)			$	899,000					$	723,000					$	176,000					24		%
Client retention			87		%				84		%				3 points						—
Wallet retention			115		%				105		%				10 points						—

(1)Dollars in thousands.

(2)Global Technology Sales includes sales to users and providers of technology. Global Business Sales includes sales to all other functional leaders.

(3)Contract values are on a foreign exchange neutral basis. Contract values as of March 31, 2021 have been calculated using the same foreign currency rates as 2022.

Research revenues increased by $156.6 million during the three months ended March 31, 2022 compared to the same period in 2021, or 16% on a reported basis and 18% excluding the foreign currency impact. The segment gross contribution margin was 75% and 74% during the three months ended March 31, 2022 and 2021, respectively. The increase in revenues during 2022 was primarily due to the same factors driving the trend in our Research contract value, which are discussed below. The increase in margin of 1 point for the three months ended March 31, 2022 compared to the same prior year period was primarily due to the increase in revenue.

Contract value increased to $4.2 billion at March 31, 2022, or 16% compared to March 31, 2021 on a foreign currency neutral basis. Global Technology Sales (“GTS”) contract value increased by 14% at March 31, 2022 when compared to March 31, 2021. The increase in GTS contract value was primarily due to new business from new and existing clients, as well as improved client retention. GTS contract value increased by double-digits for all enterprise sizes and over half of all sectors. Global Business Sales (“GBS”) contract value increased by 24% year-over-year, also primarily driven by new business from new and existing clients, and improved client retention. All of our GBS practices achieved double-digit growth rates, with the majority growing more than 20% year-over-year.

GTS client retention was 86% and 83% as of March 31, 2022 and 2021, respectively, while wallet retention was 107% and 98%, respectively. GBS client retention was 87% and 84% as of March 31, 2022 and 2021, respectively, while wallet retention was 115% and 105%, respectively. The increase in GTS and GBS wallet retention was largely due to increased spending by existing clients, as well as improved client retention of larger clients. The number of GTS client enterprises increased by 6.3% when compared to prior year, while GBS client enterprises increased by 4.3% at March 31, 2022 when compared to March 31, 2021.

Conferences

			As Of And For The Three Months Ended March 31, 2022						As Of And For The Three Months Ended March 31, 2021						Increase (Decrease)						Percentage Increase (Decrease)
Financial Measurements:
Revenues (1)			$	10,354					$	24,802					$	(14,448)					(58)		%
Gross contribution (1)			$	(2,876)					$	13,896					$	(16,772)					(121)		%
Gross contribution margin			(28)		%				56		%				(84) points						—
Business Measurements:
Number of destination conferences (2)			5						5						—						—		%
Number of destination conferences attendees (2)			3,904						5,382						(1,478)						(27)		%

(1)Dollars in thousands.

(2)Includes both virtual and in-person conferences. Single day, local meetings are excluded.

We held 5 virtual conferences during each of the three months ended March 31, 2022 and 2021. We expect to continue to deliver some conferences virtually during the remainder of the year, but are planning to re-launch in-person destination conferences beginning in the second quarter of 2022 and expect to hold in-person destination conferences in future periods as conditions permit. Conferences revenues decreased by $14.4 million during the three months ended March 31, 2022 compared to the same period in 2021. The decrease in revenues was primarily due to the use of ticket entitlements during the three months ended March 31, 2021 which we extended from 2020 due to the pandemic. Gross contribution decreased to a loss of $2.9 million during the three months ended March 31, 2022 compared to $13.9 million in income in the same period last year.

Consulting

			As Of And For The Three Months Ended March 31, 2022						As Of And For The Three Months Ended March 31, 2021						Increase (Decrease)						Percentage Increase (Decrease)
Financial Measurements:
Revenues (1)			$	116,006					$	99,504					$	16,502					17		%
Gross contribution (1)			$	51,012					$	39,098					$	11,914					30		%
Gross contribution margin			44		%				39		%				5 points						—
Business Measurements:
Backlog (1), (2)			$	146,800					$	112,700					$	34,100					30		%
Billable headcount			780						744						36						5		%
Consultant utilization			72		%				68		%				4 points						—

(1)Dollars in thousands.

(2)Backlog is on a foreign exchange neutral basis. Backlog as of March 31, 2021 has been calculated using the same foreign currency rates as 2022. We changed our method of calculating backlog beginning in 2022 to include multi-year contracts.

Consulting revenues increased by 17% during the three months ended March 31, 2022 compared to the same period in 2021 on a reported basis and 20% excluding the foreign currency impact, with a revenue increase in labor-based consulting of 14% and an increase in contract optimization of 29%, each on a reported basis. Contract optimization revenue may vary significantly and, as such, revenues for the first quarter of 2022 may not be indicative of results for the remainder of 2022 or beyond. The segment gross contribution margin was 44% and 39% for the three months ended March 31, 2022 and 2021, respectively. The increase in gross contribution margin during the first quarter of 2022 was primarily due to the increase in revenue.

Backlog increased by $34.1 million, or 30%, from March 31, 2021 to March 31, 2022 on a foreign currency neutral basis. The change in our method of calculating backlog noted above contributed approximately seven percentage points to the backlog growth rate.

LIQUIDITY AND CAPITAL RESOURCES

We finance our operations through cash generated from our operating activities and borrowings. Note 8 — Debt in the Notes to Condensed Consolidated Financial Statements provides additional information regarding the Company’s outstanding debt obligations. At March 31, 2022, we had $456.2 million of cash and cash equivalents and approximately $1.0 billion of available borrowing capacity on the revolving credit facility under our 2020 Credit Agreement. We believe that the Company has adequate liquidity to meet its currently anticipated needs for both the next twelve months and the foreseeable future.

We have historically generated significant cash flows from our operating activities, benefiting from the favorable working capital dynamics of our subscription-based business model in our Research segment, which is our largest business segment and historically has constituted a significant portion of our total revenues. The majority of our Research customer contracts are paid in advance and, combined with a strong customer retention rate and high incremental margins, has resulted in continuously strong operating cash flow. Cash flow generation has also benefited from our ongoing efforts to improve the operating efficiencies of our businesses as well as a focus on the optimal management of our working capital as we increase sales.

Our cash and cash equivalents are held in numerous locations throughout the world with 56% held overseas at March 31, 2022. We intend to reinvest substantially all of our accumulated undistributed foreign earnings, except in instances where repatriation would result in minimal additional tax. As a result of the U.S. Tax Cuts and Jobs Act of 2017, we believe that the income tax impact if such earnings were repatriated would be minimal.

The table below summarizes the changes in the Company’s cash balances for the periods indicated (in thousands).

			Three Months Ended March 31, 2022						Three Months Ended March 31, 2021						Increase (Decrease)
Cash provided by operating activities			$	167,785					$	157,298					$	10,487
Cash used in investing activities			(17,293)						(12,521)						(4,772)
Cash used in financing activities			(445,452)						(403,220)						(42,232)
Net decrease in cash and cash equivalents and restricted cash			(294,960)						(258,443)						(36,517)
Effects of exchange rates			(5,358)						(8,145)						2,787
Beginning cash and cash equivalents and restricted cash			760,602						712,583						48,019
Ending cash and cash equivalents and restricted cash			$	460,284					$	445,995					$	14,289

Operating

Cash provided by operating activities was $167.8 million and $157.3 million during the three months ended March 31, 2022 and 2021, respectively. The year-over-year increase was primarily due to an increase in deferred revenues resulting from increased bookings in Research, partially offset by higher commission and interest payments.

Investing

Cash used in investing activities was $17.3 million and $12.5 million during the three months ended March 31, 2022 and 2021, respectively. The cash used in both periods was for capital expenditures. The increase from 2021 to 2022 was the result of an increase in capitalized software additions.

Financing

Cash used in financing activities was $445.5 million and $403.2 million during the three months ended March 31, 2022 and 2021, respectively. During the 2022 period, we paid a net $1.3 million in debt principal repayments and used $451.1 million of cash for share repurchases. During the 2021 period, we repaid a net $5.0 million on our revolving credit facility under the 2020 Credit Agreement, paid a net $5.1 million in debt principal repayments and used $398.5 million of cash for share repurchases.

Debt

As of March 31, 2022, the Company had $2.5 billion of principal amount of debt outstanding, of which $4.6 million is to be repaid in the remainder of fiscal year 2022. Note 8 — Debt in the Notes to Condensed Consolidated Financial Statements

provides additional information regarding the Company’s outstanding debt obligations. From time to time, the Company may seek to retire or repurchase its outstanding debt through various methods including open market repurchases, negotiated block transactions, or otherwise, all or some of which may be effected through Rule 10b5-1 plans. Such transactions, if any, depend on prevailing market conditions, our liquidity and capital requirements, contractual restrictions, and other factors, and may involve material amounts.

OFF BALANCE SHEET ARRANGEMENTS

From January 1, 2022 through March 31, 2022, the Company has not entered into any material off-balance sheet arrangements or transactions with unconsolidated entities or other persons.