Good morning. Thank you for joining today's call. With me today are George Colony, Forrester's Chairman of the Board and CEO; Charles Rutstein, Forrester's Chief Operating Officer; and Mike Doyle, Forrester's Chief Financial Officer. George will open the call; Mike will follow George to discuss our financials. We'll then open the call to Q&A. A replay of this will be available until May 10, 2012 and can be accessed by dialing (888) 286-8010 or internationally, (617) 801-6888. Please reference the pass code 79303290. 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 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. Some of the important factors that could cause actual results to differ are discussed in our reports and filings with the Securities and Exchange Commission. The company undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. I'll now hand the call over to George Colony. [Audio Gap]

new way that Forrester is restructuring its research portfolio clients. We are moving away from the archaic model, which relies on disconnected standalone reports with programmatic approach which gives clients in-depth guidance around the [indiscernible] project and decisions. PlayBook [indiscernible] on the agenda and is not just research but for consulting events, data and leadership boards. We then connect in the client experience across all of our products. Roles created a quicker path development, and PlayBook now shortened that path, ensuring that all Forrester's work has high value for our clients. When CIOs, enterprise architects or customer experience professionals come to Forrester, PlayBooks will ensure that they get a 360-degree look at their options and a clear path to their decisions. PlayBooks will present all the Forrester's content in a clear taxonomy, guiding clients through the life cycle of their business problem. All of our role research teams are now working to produce the most relevant PlayBooks for their clients. All roles will had a completed PlayBook by the third quarter of this year, and all of our content will be in PlayBook form by the end of 2013. In parallel with a research redesign, we have also improved the delivery of that content with the launch of the new forrester.com in the first quarter. The digital connection is critical to our business. We interact with clients on a minute-to-minute basis through our site. The new forrester.com gives a more interactive experience than its predecessor, and it is designed to work seamlessly across a range of mobile devices. Clients at our forum for CMOs, which we held last week in Los Angeles, raised about 3 aspects of the new experience. Number one, its simplicity; two, the ability to navigate quickly to relevant analysis, be it a blog post, a tweet,…

Thanks, George. I will now begin my review of the financial performance for Forrester's first quarter results, the balance sheet at March 31, our first quarter metrics and the outlook for the second quarter and full year 2012. Please note that the income statement numbers I'm reporting are pro forma, and they exclude the following items: Amortization of intangibles, stock-based compensation expense, duplicate lease costs, reorganization costs, acquisition and integration costs and net gains from investments. Also for 2012, we utilize an effective tax rate of 39% for pro forma purposes. The actual effective tax rate for the first quarter of 2012 is approximately 38%. For the first quarter, Forrester met revenue guidance and exceeded its quarterly guidance for pro forma operating margin and earnings per share. Our key customer metrics continue to perform at high levels, and our balance sheet remains strong with first quarter cash flow from operations increasing 8% versus prior year. We achieved these positive results during a particularly active quarter for Forrester. As George mentioned in his opening comments, we have launched our new website, reorganized our sales organization to further enhance our client relationships and begun work on improving our products, with PlayBooks being the most significant initiative. Our sales team generated positive growth despite the challenges of a reorganization and macroeconomic headwinds in our European markets. Now let me turn to a more detailed review of our first quarter results. Forrester's first quarter revenue increased 7% to $70.3 million from $65.7 million in the first quarter of last year. First quarter research services revenue increased 12% to $49.8 million from $44.5 million last year. Research services revenue represented 71% of total revenue for the quarter. First quarter advisory services and other revenue decreased 3% to $20.5 million from $21.2 million in the first…

[Operator Instructions] And our first question comes from the line of Robert Riggs of William Blair. Please proceed.

Good morning. Thanks for taking my question. I just want to touch on the sales force and in terms of their new hires ramp into productivity. I think before the sales force realignment initiative, it was around 9 months to get a new hire to a fuller rate of productivity, with your target being 6 months. Now that a particular salesperson is covering all the roles that you have, what kind of your expectation for that time?

Hey, Robert, it's Charles. So the expectation in the short run is about the same. So in the longer run of course, we're hoping to shorten that to some degree if possible, but we're feeling our way here, given the change in the sales force and all the stuff that's under way. So that same kind of benchmark is a good place to put it for now.

Okay, great. And then you gave the R metric as 2.9 as it stands today and with the sales force initiative, the opportunity to drive penetration and, I think, existing client. How should we think about that ending up outside 2012 and progressing as we move to 2013? Do you have kind of targets that you're shooting for there?

So, Robert, Charles again. Obviously, the intention is to get that number to go up. So as you've seen over the last several quarters, we can grow the company reasonably aggressively, even without losing that metric. That metric, in some ways, helps to eliminate our opportunity, how deeply we can go into these accounts. We serve roughly 17 roles today, and we've penetrated less than 3. So you can see a lot of headroom there. That being said, we're adding to client count, of course. Many of those new clients come in at a lower number, so that drags the overall average down. It's not necessary for us to grow that metric, to grow the company aggressively, but on the other hand, we would like to see deeper penetration in those accounts.

This is a George here, Robert. I'd say with the sales reorganization, you now have fewer accounts per sales rep, in many cases. The only way that they are going to enrich those accounts is to drive our hires. So I think that the sales reorg is really going to help here.

Okay, great. And then last one from me. Could you just give us an update in terms of the attrition of the sales force that you've seen over the last, the last 3 months?

Sure, Robert, Charles. So the attrition was up modestly in Q1, and frankly, we expected that. I think you can't make a change of the magnitude that we made without expecting that. We had a large number, over half, of our accounts change hands and they're now in the hands of the salespeople, people have new bosses, et cetera, et cetera, et cetera. So we did see a little bit of a spike. We expect that number to level out for the rest of the year, now that people are off to their races, they know their territories, they know their comp plan and the uncertainty has been taken away. So it's something that we are keeping our eye on but are not particularly concerned about at this point.

Our next question comes from the line of Dan Leben of Robert W. Baird. Please proceed.

Hi. This is Tom Jackson filling in for Dan. I just wanted to ask you specifically about the enrichment rate. We saw kind of a sequential downtick there, so if you could kind of give a little bit more color around that, that would be great.

Sure, Tom. This is Mike. yes, I mean, what happened there, we -- frankly, we have one large renewal that is still in flight, and they renewed -- the account renewed partially. So the effect is that the way we calculate that, it shows a dramatic drop in enrichment on that one large account, and that skewed the metric.

Okay.

Essentially it would have been, as I did the calculations, about flat. And that in and of itself, as we've said before, we'd like to see that move upwards as well, to some degree, the same discussion that George and Charles had on are [ph] will effect enrichment in a positive way. Fewer accounts, folks are going to have to -- our sales force is going to be growing accounts in a more aggressive way in order to make their numbers, so...

Okay. So we should see somewhat of a bounce-back kind of in the second quarter there if it goes though the latter half of that contract?

yes, it should bring us back level. Again, it's a rolling metric, so it'll -- our goal, obviously, is that that's going to move upwards and trend upwards in a meaningful way over the next 4 to 6 quarters. But, yes, it should do that.

Okay. Perfect, thanks. Thanks for your color there. And then another one, we saw some nice acceleration in the agreement value growth rate. Can you just provide a little bit more color on the drivers behind that? And was there any impact from the sales organization during this quarter there?

yes, I think on AV, again, I think you guys not might be want be [ph]. I think it's an interesting metric. I tend to prefer deferred revenue. It's a bit more consistent way. So I think that it was just, from my perspective, just sort of a normal movement in AV if I look at the history. Yes, it accelerated a bit off of Q4, and it's up a bit relative to a year ago, but not meaningful. And I don't think yet the sales reorganization has had an impact on it. I do expect over time that it will. I'm a firm believer in what we've done from a selling standpoint, and I like where our sales leaders are taking this group. But, I think the movement is just, frankly, a little bit of positive noise at this point.

Perfect. And then last one for me. Can you just comment on the overall selling environment? Did you see any particular areas geography-wise or any verticals outperform or underperform in the quarter?

yes. Tom, its Charles. No major difference sequentially since Q4, I would say. To the degree that there was a change, it was continued choppiness in Europe in particular. Of course, we all know about the macro situation going on there and the uncertainty. And we defiantly see that in some of the length of the sales cycles and the amount of enrichment, to Mike's point. It may have ticked down a little bit in Europe in the quarter, but in the overall global picture, probably not a meaningful change.

Okay. Thank you very much.

Tom, this is George here. If you look forward in the year not just for Forrester, but for everyone, but depending on the election in France and also there is a political situation in The Netherlands, that could have a lot of impact on the economy of Europe over the next year. I think that if you see the Sarkozy lose the election in France, you're going to have -- now you're going to have troubles between France and Germany. As Sarkozy [indiscernible] really kept Europe as on track as it could be, and that could be a problem if Sarkozy were to lose that election. So we're obviously watching this carefully, but the whole world is.

Our next question comes from the line of Brian Murphy of Sidoti & Company. Please proceed.

George, you may have covered this, but I think we had some technical difficulties and I missed I think the first half of your prepared remarks. It's about the launch of the new website. Did you talk specifically about when that new website was launched?

It was launched in early March, March 10-ish. Again, with my notes, to see what you might have missed here. We have our all-time-high visits in the April, and return visits are way up because of this site. So...

So just looking at the new site, this is the first time that I'm seeing a la carte pricing for individual research documents. Is that...

We've had them for 10 years.

Okay.

yes. We -- it's called Click and Buy. It's been available since maybe 2003?

It's just more visible now on the new website.

Okay. With the increased visibility of the a la carte pricing, I'm wondering how that -- what your expectations are in terms of how that might impact subscription renewal rates and also revenue recognition. I mean, because if we expect that -- those sort of one-time purchases to go up, I imagine that's rolled into research revenue, which we typically think of as recurring.

yes. Brian, this is Charles. I get the question that you're asking. I mean, this has never been a meaningful portion of revenue, even though, to George's point, we've done it for 10 years. We don't expect to see any change in that in the early days in the site here. We haven't seen a new change in that. Customers like the flexibility of buying the annual agreement, because then they're not limited in the amount of research they can consume, they don't have to pay on a one-off basis, many companies don't have budget to pay on a one-off basis, they budget annually. So I don't think you are going to see any change in buyer behavior here.

Okay. And then also any new thinking around capital structure? I know you have -- you've initiated the regular dividend here, but you seem to be building cash quite quickly again.

yes, I know you're not complaining that we are building cash. This is Mike. But I think what the Board is going to do is -- it's a regular topic with them, and I think that it will be something that the Board will reflect on after we get done with our strategic planning reviews and M&A reviews in the latter part of the year and make a determination that -- really try and size how much excess cash they seem to have and then, from there, what's the best use of it. So it's early in the year, and I think that the Board's discussions are probably going to occur in the second half of 2012 as they look at what we present to them in the form of different M&A activities and other internal investments.

[Operator Instructions] Our next question is from the line of Bill Sutherland of Northland Capital Market.

Hey, Charles, on the sales force reorg, was it also done on a complete basis in Europe? Or internationally, I should...

It was, Bill, with a global change. The only region that remained largely unchanged was the Asia Pacific region, which is, of course, a very small percentage of the business, and it's something that we are incubating a little separately.

Right, right. And so when you look at the full year headcount plan in sales force, is it pretty linear as you look at your plan so that you would be by Q4 at a headcount growth level that's closer to your long-term goal?

Well, I mean, I think what you are likely to see here, Bill, is a traditional pattern that you see from us, which is that we start hiring more aggressively in the fall. We think about ramping up for the following year. So you'll probably see only modest movement here in the next quarter or 2, and then you should see more of a pop very late in the year.

Right, okay.

As you know, Bill, we typically make an assessment in the fourth -- at the beginning of the fourth quarter as to whether we should get ahead of hiring for next year.

Right, right. Then on Q, the cross book, the magic barrier in the first quarter. So are you rethinking a target there, George, or...?

Well, that was just on a quarterly basis ,'s not on yearly basis. Actually, our goal for the year is the low 70s. And we are going making good progress this year, but we will not reach 70 for the year. Is that right?

Yes, and I think -- don't let him put a new target on us, Bill, because it's aggressive enough as it is. I think that some of the function of Q in first quarter as we shifted events out of Q1 into Q2.

Right. I'm just realizing that.

We got a little bit higher percentage than we might otherwise get, but I don't think we're yet ready to reset the targets. Subsequently they'll be a little bit lower in Q2.

Okay. And then is -- just trying to think about PlayBook a little more and how that impacts business as it develops. So will it be just part of a standard subscription? Or will you have different levels? Just trying to understand that.

Hey, Bill, Charles. So in the short run here, it'll be part of the normal subscription. It's basically a change to the way that we produce the content and the way that we display it to customers. But there will not be an incremental charge for it. And there is a broader question to be asked about whether there is a more advantageous pricing and packaging model available to us. We're doing a lot of work on that right now, actually, and we'll probably talk to that in some future calls.

You mean as the content becomes more social and that sort of thing?

Well, I don't think we want to give away too much at this point, Bill, but we are thinking deeply about not only the short run, but the long term. In the short run, as always, we will look at pricing in the existing packaging structure. This summer, we generally do that in the summertime, and then we'll probably talk about that specifically on the Q2 call.

Great.

But we are thinking far beyond that. We are thinking about the new ways that our customers consume information and ways that we can more effectively deliver that to them and differentiate ourselves from the market.

Right, right.

Hey, Bill, George here. You may have missed this. I think it was garbled at the beginning of the call, but...

Right.

I'm going to read though my remarks again. So with PlayBooks, we're moving away from the archaic model, which relied on disconnected, standalone report to a programmatic approach to give the client enough guidance around those critical project decisions. So this is really about getting out of this single-report focus. Analysts might make me imagine that they have people. They don't. And it is moving away from that to a -- to all researchers, in fact, feels around specific issues and some specific projects, and it's highly programmatic, and, therefore, increasing relevancy across all of our research. That's really the point behind PlayBooks.

Right, right. Okay.

With no further questions, I would like to turn the call back over to Mike Doyle for closing remarks.

Okay. Thanks very much, everyone, for joining us on call this morning, and we look forward to being out on the road and meeting with investors during the quarter, and we'll see you again on the second quarter call. Thank you.

Thanks, everyone.

Ladies and gentlemen, that concludes today's conference. Thank you for your participation. You may disconnect at this time. Have a great day.