# Information Services Group Inc. (III) Informational only - not investment advice. CIK: 0001371489 SIC: 8742 Services-Management Consulting Services SIC breadcrumb: [Services](/division/I/) > [SIC Major Group 87](/major-group/87/) > [SIC 8742 Services-Management Consulting Services](/industry/8742/) Latest 10-K filed: 2026-03-06 SEC page: https://www.sec.gov/edgar/browse/?CIK=1371489 Filing source: https://www.sec.gov/Archives/edgar/data/1371489/000110465926024573/iii-20251231x10k.htm ## At a glance FY2025 · period end 2025-12-31 · filed 2026-03-06 · accession 0001104659-26-024573 · source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001371489.json | Metric | Value | FY | Provenance | | --- | ---: | ---: | --- | | Revenue | 244,725,000 USD | 2025 | verified | | Net income | 9,341,000 USD | 2025 | verified | | Assets | 211,001,000 USD | 2025 | verified | | Free cash flow | 24,989,000 USD | 2025 | computed | | Net margin | 3.82% | 2025 | computed | | Operating margin | 7.27% | 2025 | computed | | Revenue YoY | -1.16% | 2025 | computed | | ROE | 9.87% | 2025 | computed | Computed values are grepcent-computed from the verified facts above and may differ from ratios the company itself reports. Free cash flow = operating cash flow − capital expenditures. Net margin = net income ÷ revenue. Operating margin = operating income ÷ revenue. Revenue YoY = FY2025 revenue ÷ FY2024 revenue − 1 (consecutive fiscal years only). ROE = net income ÷ period-end stockholders' equity. No market price, no rating, no forecast on this site. Not investment advice. ### Peer percentile fingerprint | Ratio | III | Peer median | Percentile | N | | --- | ---: | ---: | ---: | ---: | | Net margin | 3.8% | 4.6% | 38 | 14 | | Operating margin | 7.3% | 7.5% | 46 | 14 | | Revenue growth | -1.2% | 5.4% | 31 | 14 | | FCF margin | 10.2% | 9.3% | 54 | 14 | | ROE | 9.9% | 12.7% | 46 | 14 | | ROA | 4.4% | 5.4% | 38 | 14 | | Liabilities / equity | 1.23 | 1.34 | 38 | 14 | | Current ratio | 2.34 | 1.60 | 92 | 14 | Percentile = share of the N covered peers reporting that ratio whose value is lower (ties counted half); computed among grepcent-covered companies in SIC industry 8742 Services-Management Consulting Services, not the whole market. A higher percentile means a higher value of the ratio, not a better company. Ratios with fewer than 8 reporting peers are omitted. Latest reported values per company; fiscal periods may differ. Descriptive arithmetic - not a score, rating, or ranking. ## Selected Fundamentals | Metric | Value | Unit | FY | Filed | | --- | ---: | --- | ---: | --- | | Revenue | 244725000 | USD | 2025 | 2026-03-06 | | Net income | 9341000 | USD | 2025 | 2026-03-06 | | Assets | 211001000 | USD | 2025 | 2026-03-06 | ## Financials Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-03-06. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001371489.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts. | Metric | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | Revenue | | | 269,554,000 | 275,769,000 | 265,763,000 | 249,128,000 | 277,832,000 | 286,267,000 | 291,054,000 | 247,585,000 | 244,725,000 | | Net income | | | -2,130,000 | 5,677,000 | 3,341,000 | 2,755,000 | 15,529,000 | 19,726,000 | 6,154,000 | 2,839,000 | 9,341,000 | | Operating income | | -2,592,000 | 9,157,000 | 12,677,000 | 13,358,000 | 9,269,000 | 25,267,000 | 29,480,000 | 14,612,000 | 5,757,000 | 17,796,000 | | Diluted EPS | | -0.18 | -0.05 | 0.12 | 0.07 | 0.06 | 0.30 | 0.39 | 0.12 | 0.06 | 0.19 | | Operating cash flow | | 12,359,000 | 11,444,000 | 19,128,000 | 20,437,000 | 43,971,000 | 41,942,000 | 11,146,000 | 12,272,000 | 19,865,000 | 29,011,000 | | Capital expenditures | | 2,359,000 | 3,169,000 | 3,999,000 | 1,922,000 | 1,181,000 | 2,320,000 | 3,423,000 | 3,433,000 | 2,830,000 | 4,022,000 | | Dividends paid | 5,189,000 | | | | | | 4,437,000 | 7,461,000 | 8,687,000 | 9,393,000 | 9,183,000 | | Share buybacks | | 11,565,000 | 2,853,000 | 3,063,000 | 3,428,000 | 5,166,000 | 16,331,000 | 12,070,000 | 3,497,000 | 5,572,000 | 9,271,000 | | Assets | | 235,122,000 | 224,760,000 | 214,731,000 | 218,755,000 | 239,520,000 | 236,794,000 | 243,028,000 | 247,345,000 | 204,515,000 | 211,001,000 | | Liabilities | | 176,710,000 | 161,223,000 | 136,144,000 | 129,081,000 | 140,383,000 | 138,401,000 | 142,597,000 | 145,263,000 | 108,229,000 | 116,325,000 | | Stockholders' equity | | 57,036,000 | 63,537,000 | 78,587,000 | 89,674,000 | 99,137,000 | 98,393,000 | 100,431,000 | 102,082,000 | 96,286,000 | 94,676,000 | | Cash and cash equivalents | | 34,485,000 | 28,420,000 | 18,636,000 | 18,153,000 | 43,730,000 | 47,521,000 | 30,587,000 | 22,636,000 | 23,075,000 | 28,661,000 | | Free cash flow | | 10,000,000 | 8,275,000 | 15,129,000 | 18,515,000 | 42,790,000 | 39,622,000 | 7,723,000 | 8,839,000 | 17,035,000 | 24,989,000 | ### Ratios ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported. | Metric | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | Net margin | | | -0.79% | 2.06% | 1.26% | 1.11% | 5.59% | 6.89% | 2.11% | 1.15% | 3.82% | | Operating margin | | | 3.40% | 4.60% | 5.03% | 3.72% | 9.09% | 10.30% | 5.02% | 2.33% | 7.27% | | Return on equity | | | -3.35% | 7.22% | 3.73% | 2.78% | 15.78% | 19.64% | 6.03% | 2.95% | 9.87% | | Return on assets | | | -0.95% | 2.64% | 1.53% | 1.15% | 6.56% | 8.12% | 2.49% | 1.39% | 4.43% | | Liabilities / equity | | 3.10 | 2.54 | 1.73 | 1.44 | 1.42 | 1.41 | 1.42 | 1.42 | 1.12 | 1.23 | | Current ratio | | 2.03 | 1.95 | 2.42 | 2.42 | 2.26 | 2.04 | 2.26 | 2.44 | 2.38 | 2.34 | ## As-reported value updates No tracked differences above grepcent's stated thresholds and capped precision rule were found between the earliest XBRL-filed value and the value currently on file for the standardized annual metrics grepcent tracks. ## Quarterly Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-08-06. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001371489.json. Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived. | Quarter | End date | Revenue | Net income | Diluted EPS | Method | | --- | --- | ---: | ---: | ---: | --- | | 2022-Q3 | 2022-09-30 | | | 0.11 | reported discrete quarter | | 2023-Q1 | 2023-03-31 | | | 0.07 | reported discrete quarter | | 2023-Q2 | 2023-06-30 | | | 0.05 | reported discrete quarter | | 2023-Q3 | 2023-09-30 | 71,773,000 | 3,201,000 | 0.06 | reported discrete quarter | | 2023-Q4 | 2023-12-31 | 66,186,000 | -2,871,000 | | derived Q4 = FY annual - nine-month YTD | | 2024-Q1 | 2024-03-31 | 64,269,000 | -3,389,000 | -0.07 | reported discrete quarter | | 2024-Q2 | 2024-06-30 | 64,263,000 | 2,038,000 | 0.04 | reported discrete quarter | | 2024-Q3 | 2024-09-30 | 61,277,000 | 1,148,000 | 0.02 | reported discrete quarter | | 2024-Q4 | 2024-12-31 | 57,777,000 | 3,042,000 | | derived Q4 = FY annual - nine-month YTD | | 2025-Q1 | 2025-03-31 | 59,583,000 | 1,488,000 | 0.03 | reported discrete quarter | | 2025-Q2 | 2025-06-30 | 61,565,000 | 2,183,000 | 0.04 | reported discrete quarter | | 2025-Q3 | 2025-09-30 | 62,364,000 | 3,056,000 | 0.06 | reported discrete quarter | | 2025-Q4 | 2025-12-31 | 61,213,000 | 2,614,000 | | derived Q4 = FY annual - nine-month YTD | | 2026-Q1 | 2026-03-31 | 61,183,000 | 2,716,000 | 0.05 | reported discrete quarter | | 2026-Q2 | 2026-06-30 | 65,488,000 | 3,298,000 | 0.07 | reported discrete quarter | ## Filed narrative (10-K & 10-Q) ## Business Verbatim Item 1 Business section from III's latest 10-K: [/company/III/business/](/company/III/business/). ## Risk Factors Verbatim Item 1A Risk Factors from III's latest 10-K: [/company/III/risk-factors/](/company/III/risk-factors/). ## Latest quarter (10-Q) Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1371489/000110465926091859/iii-20260630x10q.htm Extracted structurally from real Item 2 body heading to real Item 3/4 boundary. Confidence: high Filing date: 2026-08-06 Report date: 2026-06-30 ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS You should read the following discussion and analysis in conjunction with our financial statements and related notes included elsewhere in this report. Except for historical information, the discussion in this report contains certain forward-looking statements that involve risks and uncertainties. We have based these forward-looking statements on our current expectations and assumptions about future events. In some cases, you can identify forward-looking statements by terminology such as “may,” “should,” “could,” “predict,” “potential,” “continue,” “expect,” “anticipate,” “future,” “intend,” “plan,” “believe,” “estimate,” “forecast” and similar expressions (or the negative of such expressions). Forward-looking statements include, but are not limited to, statements concerning 2026 revenue growth rates and capital expenditures. Forward-looking statements are based on our beliefs as well as assumptions based on information currently available to us, including financial and operational information, the volatility of our stock price, current competitive conditions and the impact of U.S. tariffs, trade barriers and restrictions, as well as wars, such as the conflict in Iran. As a result, these statements are subject to various risks and uncertainties. For a discussion of material risks and uncertainties that we face, see the discussion in our Annual Report on Form 10-K for the fiscal year ended December 31, 2025 titled “Risk Factors” and in this Quarterly Report on Form 10-Q under Item 1A of Part II, “Risk Factors.” BUSINESS OVERVIEW Information Services Group, Inc. (Nasdaq: III) is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world’s top 100 enterprises, ISG is a long-time leader in technology and business services sourcing that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data and research, in-depth knowledge and governance of provider ecosystems, and the expertise of its approximately 1,500 professionals 17 ​ worldwide working together to help clients maximize the value of their technology investments. For more information, visit www.isg-one.com. The content on our website is available for informational purposes only. It should not be relied upon for investment purposes, nor is it incorporated by reference into this Quarterly Report on Form 10-Q or any other filings. Our strategy is to strengthen our existing market position and develop new services and products to support future growth plans. As a result, we are focused on growing our existing service model, expanding geographically, developing new industry sectors, productizing market data assets, expanding our managed services offerings and growing via acquisitions. Although we do not expect any adverse conditions that will impact our ability to execute against our strategy over the next twelve months, the more significant factors that could limit our ability to grow in these areas include global macro-economic conditions and the impact on the overall sourcing market, competition, our ability to retain advisors and reductions in discretionary spending with our top client accounts or other significant client events. Other areas that could impact the business would also include natural disasters, pandemics, wars, legislative and regulatory changes and capital market disruptions. We principally derive revenues from fees for services generated on a project-by-project basis. Prior to the commencement of a project, we reach agreement with the client on rates for services based upon the scope of the project, staffing requirements and the level of client involvement. Revenues for services rendered are recognized on a time and materials basis or on a fixed-fee or capped-fee basis in accordance with accounting and disclosure requirements for revenue recognition. Revenues for time and materials contracts are recognized based on the number of hours worked by our advisors at an agreed upon rate per hour and are recognized in the period in which services are performed. Revenues for time and materials contracts are billed monthly, semimonthly or in accordance with the specific contractual terms of each project. We also derive our revenues from certain recurring revenue streams. These include such annuity-based ISG offerings as ISG GovernX, ISG Research Lens, ISG Inform and the multi-year Public Sector contracts. These offerings are characterized by subscriptions (i.e., renewal-centric as opposed to project-centric revenue streams) or, in some instances, multi-year contracts. Our digital services now span a volume of offerings and have become embedded as part of our traditional transaction services. Digital enablement provides capabilities, digital insights and better engagement with clients and partners. Our results are impacted principally by our full-time consultants’ utilization rate, the number of business days in each quarter and the number of our revenue-generating professionals who are available to work. Our utilization rate can be negatively affected by increased hiring because there is generally a transition period for new professionals that results in a temporary drop in our utilization rate. Our utilization rate can also be affected by seasonal variations in the demand for our services from our clients. The number of business workdays is also affected by the number of vacation days taken by our consultants and holidays in each quarter. We typically have fewer business workdays available in the fourth quarter of the year, which can impact revenues during that period. Time-and-expense engagements do not provide us with a high degree of predictability as to performance in future periods. Unexpected changes in the demand for our services can result in significant variations in utilization and revenues and present a challenge to optimal hiring and staffing. The volume of work performed for any particular client can vary widely from period to period. 18 ​ RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED JUNE 30, 2026 AND JUNE 30, 2025 ​ Revenues ​ The following table presents a breakdown of our revenue by geographic area: ​ [[GREPCENT_TABLE]] [["\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b"],["\u200b","\u200b","Three Months Ended June 30,","","\u200b"],["\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","Percent","","\u200b"],["Geographic Area","\u200b \u200b \u200b","2026","\u200b \u200b \u200b","2025","\u200b \u200b \u200b","Change","\u200b \u200b \u200b","\u200b \u200b \u200bChange","\u200b","\u200b"],["\u200b","\u200b","($ in thousands)","","\u200b"],["Americas","\u200b \u200b \u200b","$","42,136","\u200b \u200b \u200b","$","39,480","\u200b \u200b \u200b","$","2,656","\u200b \u200b \u200b","\u200b \u200b \u200b","7","%","\u200b"],["Europe","\u200b","","18,268","\u200b","","16,637","\u200b","","1,631","\u200b","","10","%","\u200b"],["Asia Pacific","\u200b","","5,084","\u200b","","5,448","\u200b","","(364)","\u200b","","(7)","%","\u200b"],["Total revenues","\u200b","$","65,488","\u200b","$","61,565","\u200b","$","3,923","\u200b","","6","%","\u200b"]] [[/GREPCENT_TABLE]] ​ Revenues increased $3.9 million, or approximately 6%, in the second quarter of 2026 compared to the second quarter of 2025. The increase in revenues in the Americas was primarily due to the increase in the Research, GovernX and Consulting service lines, partially offset by a decrease in Network & Software (“NaSa”) service line. The increase in revenues in Europe was primarily due to increases in the Consulting, NaSa and GovernX service lines, partially offset by a decrease in the Research service line. The decrease in revenues in Asia Pacific was attributable to a decrease in the Research service line. The translation of foreign currency revenues into U.S. dollars positively impacted performance compared to the prior year by $0.7 million. ​ Operating Expenses ​ The following table presents a breakdown of our operating expenses by category: ​ [[GREPCENT_TABLE]] [["\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b"],["\u200b","\u200b","Three Months Ended June 30,","","\u200b"],["\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","\u200b","Percent","","\u200b"],["Operating Expenses","\u200b \u200b \u200b","2026","\u200b \u200b \u200b","2025","\u200b \u200b \u200b","Change","\u200b \u200b \u200b","Change","\u200b","\u200b"],["\u200b","\u200b","($ in thousands)","","\u200b"],["Direct costs and expenses for advisors","\u200b \u200b \u200b","$","33,519","\u200b \u200b \u200b","$","35,591","\u200b \u200b \u200b","$","(2,072)","\u200b \u200b \u200b","\u200b \u200b \u200b","(6)","%","\u200b"],["Selling, general and administrative","\u200b","","25,055","\u200b","","20,144","\u200b","","4,911","\u200b","","24","%","\u200b"],["Depreciation and amortization","\u200b","","1,057","\u200b","","1,165","\u200b","","(108)","\u200b","","(9)","%","\u200b"],["Total operating expenses","\u200b","$","59,631","\u200b","$","56,900","\u200b","$","2,731","\u200b","","5","%","\u200b"]] [[/GREPCENT_TABLE]] ​ Total operating expenses increased $2.7 million, or approximately 5%, for the second quarter of 2026 compared to the second quarter of 2025. The increase in operating expenses was primarily attributable to higher bad debt expense of $4.3 million (refer to Note 5 – Revenue – “Accounts Receivable and Contract Assets” for further details), higher compensation expense of $1.4 million, and higher stock-based compensation expense of $0.2 million. These increases were partially offset by lower contractor labor expense of $3.0 million, of which $4.3 million is discussed in Note 5, lower professional fees of $0.1 million and lower restructuring costs of $0.1 million. ​ Compensation costs consist of a mix of fixed and variable salaries, annual bonuses, benefits and profit-sharing plan contributions. A portion of compensation expenses for certain billable employees is allocated between direct costs and selling, general and administrative costs based on relative time spent between billable and non-billable activities. Bonus compensation is determined based on achievement against Company financial targets and is accrued monthly throughout the year based on management’s estimates of target achievement. Statutory and elective profit-sharing plans are offered to employees as appropriate. Direct costs also include employee taxes, health insurance, workers’ compensation and disability insurance. ​ Sales and marketing costs consist principally of compensation expenses related to business development, proposal preparation and delivery and negotiation of new client contracts. Costs also include travel expenses relating to the pursuit of sales opportunities, expenses for hosting periodic client conferences, public relations activities, participation in industry conferences, industry relations, website maintenance and business intelligence activities. The Company maintains a 19 ​ dedicated global marketing function responsible for developing and managing sales campaigns, brand promotion, the ISG Index and assembling proposals. ​ We maintain a comprehensive program for training and professional development. Related expenses include product training, updates on new service offerings or methodologies and development of project management skills. Also included in training and professional development are expenses associated with the development, enhancement and maintenance of our proprietary methodologies and tools [Excerpt truncated for page length; source filing is linked above.] ## Latest 10-K MD&A (excerpt) Latest 10-K Item 7 source: https://www.sec.gov/Archives/edgar/data/1371489/000110465926024573/iii-20251231x10k.htm Complete FY 2025 MD&A: /company/III/mda/fy2025/ Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary. Published MD&A gate trimmed front/tail over-capture. Confidence: high Filing date: 2026-03-06 Report date: 2025-12-31 Item 7.  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 operating results, financial condition and cash flows of the Company. 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 consolidated financial statements and related notes included in this Annual Report on Form 10-K. Historical results and percentage relationships are not necessarily indicative of operating results for future periods. References to “ISG”, “we,” “our” and “us” in this MD&A are to the Company and its consolidated subsidiaries. This MD&A provides an analysis of our consolidated financial results and cash flows for 2025 and 2024 under the headings “Results of Operations,” “Non-GAAP Financial Presentation,” “Non-GAAP Financial Measures,” and “Liquidity and Capital Resources.” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” in our Annual Report on Form 10-K for the year ended December 31, 2024. BUSINESS OVERVIEW Information Services Group, Inc. (Nasdaq: III) is a global AI-centered technology research and advisory firm. A trusted partner to more than 900 clients, including 75 of the world’s top 100 enterprises, ISG is a long-time leader in technology and business services sourcing that is now at the forefront of leveraging AI to help organizations achieve operational excellence and faster growth. The firm, founded in 2006, is known for its proprietary market data and research, in-depth knowledge and governance of provider ecosystems, and the expertise of its 1,500 professionals worldwide working together to help clients maximize the value of their technology investments. For more information, visit www.isg-one.com. The content on our website is available for informational purposes only. It should not be relied upon for investment purposes, nor is it incorporated by reference into this Annual Report on Form 10 K or any other filings. Our strategy is to strengthen our existing market position and develop new services and products to support future growth plans. As a result, we are focused on growing our existing service model, expanding geographically, developing new industry sectors, productizing market data assets, expanding our managed services offerings and growing via acquisitions. Although we do not expect any adverse conditions that will impact our ability to execute against our strategy over the next twelve months, the more significant factors that could limit our ability to grow in these areas include global macro-economic conditions and the impact on the overall sourcing market, competition, our ability to retain advisors and reductions in discretionary spending with our top client accounts or other significant client events. Other areas that could impact the business would also include natural disasters, pandemics, wars, legislative and regulatory changes and capital market disruptions. We principally derive revenues from fees for services generated on a project-by-project basis. Prior to the commencement of a project, we reach agreement with the client on rates for services based upon the scope of the project, staffing requirements and the level of 26 Table of Contents client involvement. Revenues for services rendered are recognized on a time and materials basis or on a fixed-fee or capped-fee basis in accordance with accounting and disclosure requirements for revenue recognition. Revenues for time and materials contracts are recognized based on the number of hours worked by our advisors at an agreed upon rate per hour and are recognized in the period in which services are performed. Revenues for time and materials contracts are billed monthly, semimonthly or in accordance with the specific contractual terms of each project. We also derive our revenues from certain recurring revenue streams. These include such annuity-based ISG offerings as ISG GovernX, ISG Research Lens. ISG Inform and the multi-year Public Sector contracts. These offerings are characterized by subscriptions (i.e., renewal-centric as opposed to project-centric revenue streams) or, in some instances, multi-year contracts. Our digital services now span a volume of offerings and have become embedded as part of our traditional transaction services. Digital enablement provides capabilities, digital insights and better engagement with clients and partners. Our results are impacted principally by our full-time consultants’ utilization rate, the number of business days in each quarter and the number of our revenue-generating professionals who are available to work. Our utilization rate can be negatively affected by increased hiring because there is generally a transition period for new professionals that result in a temporary drop in our utilization rate. Our utilization rate can also be affected by seasonal variations in the demand for our services from our clients. The number of business workdays is also affected by the number of vacation days taken by our consultants and holidays in each quarter. We typically have fewer business workdays available in the fourth quarter of the year, which can impact revenues during that period. Time-and-expense engagements do not provide us with a high degree of predictability as to performance in future periods. Unexpected changes in the demand for our services can result in significant variations in utilization and revenues and present a challenge to optimal hiring and staffing. The volume of work performed for any particular client can vary widely from period to period. CURRENT ENVIRONMENT Inflation rates and the adverse effect of interest rates continued to be volatile in the past year. Inflation has not had a material effect on our business operations, financial performance and results of operations, other than its impact on the general economy. Changes to interest rates has impacted our business operations, financial performance and results of operations, as our interest expense has decreased from $5.8 million in 2024 to $4.1 million in 2025. The Company continuously monitors these changes and evaluates any effect. If our costs, in particular personnel-related costs, were to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases in future periods. Our inability or failure to realize these offsets could adversely affect our business operations, financial performance and results of operations. EXECUTIVE SUMMARY 2025 was a year of accelerating growth for ISG. Fueled by continuing client interest in our AI-powered transformation services, an improved business mix and our disciplined operating approach. ​ Our 2025 results were achieved in the face of macroeconomic headwinds that resulted in longer decision cycles and cautious spending. Leading the way was our Americas business, which had its strongest revenue growth since 2021, up 11 percent, excluding 2024 results from our divested automation unit. We also saw solid improvement in our EMEA region in the second half, capped by 28 percent growth in the fourth quarter as the region began to recover from earlier macro challenges.   ​ Enterprise AI consulting and research, not surprisingly, played a significant part in our growth, and now represents about 30 percent of our firmwide revenue, up from 10 percent last year. We have served more than 350 clients with AI advisory and research services this year, focusing on strategy, sourcing, data transformation and agentic AI. That’s up more than 200 percent from the prior year. ​ Our recurring revenue, meanwhile, continues to be a strength, with growth driven by our Research and Governance units. Recurring revenues, highly valued for their predictability, represented 46 percent of our firmwide total in 2025. ​ Our ISG Research business delivered double-digit growth, led by our ISG Provider Lens® provider evaluation research and ISG Events. Client interest in AI-related content continues to rise, evidenced by our five sold-out AI Impact Summit events held across the globe in 2025. In addition, our third annual State of Enterprise AI Adoption study quickly became our most downloaded report ever. ​ Software continues to be a significant spend category for enterprises, with global spending expected to double to more than $1.4 trillion by end of 2030, with AI as a catalyst. In 2025, our Software unit achieved double-digit growth, reflecting strong enterprise demand for insights and support in this area. ​ 27 Table of Contents Our ISG Platforms, infused with the power of AI, also performed well, especially our ISG GovernX® supplier governance and risk management platform. Leveraging GovernX, our Governance unit served more than 80 clients in 2025, growing both revenue and capabilities. Soon to be launched is a new AI governance solution that will help clients manage AI risk. ​ ISG Tango™, our AI-powered, future-proof sourcing solution, has quickly become our most successful platform product to date. We are now managing more than $25 billion of total contract value through the platform, as we continue to transition our sourcing work to Tango. In addition to modernizing and ensuring our entire sourcing process is more efficient, ISG Tango also gives us the platform capabilities we need to expand into the underserved mid-market (enterprises with $10 billion of revenue or less). With the power of Tango and our dedicated approach, we have been very successful in penetrating this market, adding more than 50 new clients in 2025. ​ Our Enterprise Change and Training as a Service (TaaS) business had a strong year, landing some of our largest multi-year accounts in 2025. Importantly, the number of our broader advisory engagements that included OCM increased by 20 percent this year, as change management becomes more integral to our solutioning. ​ In addition to our organic growth initiatives, we expanded our business in Europe this year by acquiring Martino & Partners, a highly regarded strategic advisory firm that serves primarily public sector clients in Italy. This acquisition expands our addressable market in Italy, where we see an emerging growth opportunity. ​ In another move to expand our capabilities, we acquired the AI Maturity Index in January this year. This AI readiness benchmarking and intelligence platform allows organizations to identify gaps in their workforce readiness and use a data-driven approach to achieve rapid improvement. This offering is already generating strong interest and opening up new client discussions about our broad range of AI-related capabilities.   ​ ​ RESULTS OF OPERATIONS YEAR ENDED DECEMBER 31, 2025 COMPARED TO YEAR ENDED DECEMBER 31, 2024 Revenues Revenues are generally derived from fixed-fee contracts as well as engagements priced on a time and materials basis, which are recorded based on actual time worked as the services are performed. In addition, we also earn revenues which are contingent on the attainment of certain contractual milestones. Revenues related to materials required during an engagement (mainly out-of-pocket expenses such as airfare, lodging and meals) generally do not include a profit mark up and can be charged and reimbursed separately or as part of the overall fee arrangement. Invoices are issued to clients monthly, semimonthly or in accordance with the specific contractual terms of each project. We operate in one segment, fact-based sourcing advisory services. We operate principally in the Americas, Europe and Asia Pacific. Our foreign operations are subject to local government regulations and to the uncertainties of the economic and political conditions of those areas, and the [Excerpt truncated for page length; the complete text is on the linked full-MD&A page.] Read the full FY 2025 MD&A: /company/III/mda/fy2025/ All MD&A years: /company/III/mda/ ## MD&A history Prior-year 10-K MD&A spans are extracted from SEC filings with the same bounded parser used for the latest filing. Each year's full verbatim text is on its own sub-page. - [FY 2024 MD&A](/company/III/mda/fy2024/): filed 2025-03-13; accession 0001558370-25-002897 (https://www.sec.gov/Archives/edgar/data/1371489/000155837025002897/iii-20241231x10k.htm) - [FY 2023 MD&A](/company/III/mda/fy2023/): filed 2024-03-08; accession 0001558370-24-002831 (https://www.sec.gov/Archives/edgar/data/1371489/000155837024002831/iii-20231231x10k.htm) - [FY 2022 MD&A](/company/III/mda/fy2022/): filed 2023-03-10; accession 0001558370-23-003447 (https://www.sec.gov/Archives/edgar/data/1371489/000155837023003447/iii-20221231x10k.htm) - [FY 2021 MD&A](/company/III/mda/fy2021/): filed 2022-03-11; accession 0001558370-22-003397 (https://www.sec.gov/Archives/edgar/data/1371489/000155837022003397/iii-20211231x10k.htm) ## Macro cross-references Indicators mapped to this company's SIC classification (industry 8742 Services-Management Consulting Services) by grepcent's deterministic macro-sector crosswalk. A navigational mapping, not a statistical or causal claim. - [PCE](/indicator/PCE/): Personal Consumption Expenditures - [GDPC1](/indicator/GDPC1/): Real Gross Domestic Product - [PAYEMS](/indicator/PAYEMS/): All Employees, Total Nonfarm - [CES0500000003](/indicator/CES0500000003/): Average Hourly Earnings of All Employees, Total Private - [UNRATE](/indicator/UNRATE/): Unemployment Rate - [DSPIC96](/indicator/DSPIC96/): Real Disposable Personal Income Macro-to-micro threads including this sector: [US labor market](/thread/us-labor-market/), [Growth & output](/thread/growth-output/), [Government finances](/thread/government-finances/), [Sector employment](/thread/sector-employment/). All macro indicators: /indicators/ ## For LLMs & downloads Markdown twin: /company/III.md · JSON record: /company/III.json · verified financials: /company/III/financials.json / /company/III/financials.csv · machine TOC for the whole site: /llms.txt