MW Why Gartner and other IT stocks got slammed on Tuesday

By Hannah Pedone

Gartner says customers are 'slowing and deferring everything possible' as they make sense of a shifting AI landscape

FactSet and Gartner shares were among last year's weakest performers in the S&P 500, and they were hit hard again on Tuesday.

Shares of information-technology research firm Gartner closed at their lowest level in five years, underscoring how artificial intelligence is disrupting the landscape for professional research and consulting.

Gartner's (IT) guidance for the full year came in below expectations, with the company forecasting adjusted earnings per share of at least $12.30, versus the $13.52 FactSet analyst consensus, as well as revenue of at least $6.455 billion, versus the $6.703 billion consensus view.

The company's commentary on the market backdrop signaled sustained challenges due to AI. Customers outside the world of AI "experienced a shifting landscape," prompting them to scrutinize potential deals more closely and require more approvals before inking arrangements, Gartner CEO Eugene Hall said on an earnings call.

That's made for "a much tougher selling environment," he noted, as customers respond to the rapidly changing environment "by slowing and deferring everything possible."

See also: Software stocks sink, extending their historic underperformance. What comes next?

For Gartner, there's "a huge opportunity" to serve customers that are navigating a chaotic transition, according to Hall. But the company's guidance suggests the volatility could be painful in the short term.

Gartner's stock lost 20.9% Tuesday to finish at its lowest level since Feb. 3, 2021, according to Dow Jones Market Data. Also falling were shares of other professional-services firms, including Accenture $(ACN)$, Cognizant $(CTSH)$, Genpact $(G)$ and ExlService $(EXLS)$.

The AI fears are not exactly new. Gartner and FactSet $(FDS)$ were some of the weakest performers in the S&P 500 SPX last year, as investors worried that large language models and other products from AI companies would reduce the need for legacy research and software offerings.

That argument got some more juice on Tuesday following Anthropic's recent release of new plug-ins for Claude Cowork, an AI-powered desktop agent. The new features allow companies to automate legal work like reviewing contracts and screening NDA agreements.

Baird analyst David Koning said Anthropic's product launch could be driving the weak performance in IT-services stocks - though "Gartner's weak earnings release may be causing a little consternation as well," he wrote in a note - especially given that earnings results in the IT sector more broadly have been solid.

Read: These software stocks could rise as much as 75%. But is now the time to buy?

-Hannah Pedone

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February 03, 2026 17:17 ET (22:17 GMT)

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