tdc-20240930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-33458

TERADATA CORPORATION

(Exact name of registrant as specified in its charter)


Delaware						75-3236470
(State or other jurisdiction of						(I.R.S. Employer
incorporation or organization)						Identification No.)

17095 Via Del Campo

San Diego, California 92127

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (866) 548-8348

Securities registered pursuant to Section 12(b) of the Act:

Title of each class:

Trading Symbol

Name of Each Exchange on which Registered:

Common Stock, $0.01 par value

TDC

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

☐

Non-accelerated filer

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ý

At October 25, 2024, the registrant had approximately 95.7 million shares of common stock outstanding.

TABLE OF CONTENTS

PART I—FINANCIAL INFORMATION




	Description	Page

Item 1.	Financial Statements

	Condensed Consolidated Statements of Income (Unaudited) Three and Nine Months Ended September 30, 2024 and 2023	4

	Condensed Consolidated Statements of Comprehensive Income (Unaudited) Three and Nine Months Ended September 30, 2024 and 2023	5

	Condensed Consolidated Balance Sheets (Unaudited) September 30, 2024 and December 31, 2023	6

	Condensed Consolidated Statements of Cash Flows (Unaudited) Nine Months Ended September 30, 2024 and 2023	7

	Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) Three and Nine Months Ended September 30, 2024 and 2023	8

	Notes to Condensed Consolidated Financial Statements (Unaudited)	10

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31

Item 4.	Controls and Procedures	32

PART II—OTHER INFORMATION

	Description	Page

Item 1.	Legal Proceedings	32

Item 1A.	Risk Factors	32

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	33

Item 3.	Defaults Upon Senior Securities	33

Item 4.	Mine Safety Disclosures	33

Item 5.	Other Information	33

Item 6.	Exhibits	35

	Signatures	36

Table of Contents

Part 1—FINANCIAL INFORMATION


Item 1.			Financial Statements.

Teradata Corporation

Condensed Consolidated Statements of Income (Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
In millions, except per share amounts	2024		2023		2024		2023
Revenue
Subscription software licenses	$	72	$	66	$	235	$	240
Services and other	300		294		893		880
Total recurring	372		360		1,128		1,120
Perpetual software licenses, hardware and other	7		7		20		33
Consulting services	61		71		193		223
Total revenue	440		438		1,341		1,376
Cost of revenue
Subscription software licenses	4		5		14		16
Services and other	107		100		319		294
Total recurring	111		105		333		310
Perpetual software licenses, hardware and other	5		7		18		30
Consulting services	58		67		175		199
Total cost of revenue	174		179		526		539
Gross profit	266		259		815		837
Operating expenses
Selling, general and administrative expenses	137		156		429		476
Research and development expenses	73		76		216		222
Total operating expenses	210		232		645		698
Income from operations	56		27		170		139
Other expense, net
Interest expense	(7)		(8)		(22)		(22)
Interest income	3		7		9		22
Other expense	(5)		(13)		(23)		(44)
Total other expense, net	(9)		(14)		(36)		(44)
Income before income taxes	47		13		134		95
Income tax expense	15		1		45		26
Net income	$	32	$	12	$	89	$	69
Net income per common share
Basic	$	0.33	$	0.12	$	0.92	$	0.69
Diluted	$	0.33	$	0.12	$	0.91	$	0.67
Weighted average common shares outstanding
Basic	96.1		99.2		96.7		100.5
Diluted	97.0		102.0		98.3		102.8

See Notes to Condensed Consolidated Financial Statements (Unaudited).

Teradata Corporation

Condensed Consolidated Statements of Comprehensive Income (Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
In millions	2024		2023		2024		2023
Net income	$	32	$	12	$	89	$	69
Other comprehensive income (loss):
Foreign currency translation adjustments	9		(17)		(6)		(17)
Unrealized (loss) gain on cross-currency net investment hedge, before tax	(4)		3		1		—
Unrealized (loss) gain on cross-currency net investment hedge, tax portion	1		—		—		—
Total currency translation adjustments	6		(14)		(5)		(17)
Derivatives:
Unrealized (loss) gain on derivatives, before tax	(12)		4		(6)		7
Unrealized (loss) gain on derivatives, tax portion	3		—		1		(1)
Unrealized (loss) gain on derivatives, net of tax	(9)		4		(5)		6
Defined benefit plans:
Defined benefit plan adjustment, before tax	3		2		7		6
Defined benefit plan adjustment, tax portion	(1)		(1)		(2)		(2)
Defined benefit plan adjustment, net of tax	2		1		5		4
Other comprehensive loss	(1)		(9)		(5)		(7)
Comprehensive income	$	31	$	3	$	84	$	62

See Notes to Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

Teradata Corporation

Condensed Consolidated Balance Sheets (Unaudited)


In millions, except per share amounts	September 30, 2024		December 31, 2023
Assets
Current assets
Cash and cash equivalents	$	348	$	486
Accounts receivable, net	247		286
Inventories	16		13
Other current assets	92		84
Total current assets	703		869
Property and equipment, net	202		239
Right of use assets - operating lease, net	6		9
Goodwill	399		398
Capitalized contract costs, net	49		68
Deferred income taxes	215		221
Other assets	85		69
Total assets	$	1,659	$	1,873
Liabilities and stockholders’ equity
Current liabilities
Current portion of long-term debt	$	25	$	19
Current portion of finance lease liability	60		66
Current portion of operating lease liability	4		6

Accounts payable	85		100
Payroll and benefits liabilities	105		130
Deferred revenue	482		570
Other current liabilities	114		105
Total current liabilities	875		996
Long-term debt	461		480
Finance lease liability	40		63
Operating lease liability	3		6
Pension and other postemployment plan liabilities	96		102
Long-term deferred revenue	13		22
Deferred tax liabilities	8		8
Other liabilities	38		61
Total liabilities	1,534		1,738
Commitments and contingencies (Note 8)
Stockholders’ equity
Preferred stock: par value $0.01 per share, 100.0 shares authorized, no shares issued and outstanding at September 30, 2024 and December 31, 2023, respectively	—		—
Common stock: par value $0.01 per share, 500.0 shares authorized, 96.0 and 97.9 shares issued at September 30, 2024 and December 31, 2023, respectively	1		1
Paid-in capital	2,166		2,074

Accumulated deficit	(1,908)		(1,811)
Accumulated other comprehensive loss	(134)		(129)
Total stockholders’ equity	125		135
Total liabilities and stockholders’ equity	$	1,659	$	1,873

See Notes to Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

Teradata Corporation

Condensed Consolidated Statements of Cash Flows (Unaudited)


	Nine Months Ended September 30,
In millions	2024		2023
Operating activities
Net income	$	89	$	69
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	78		86
Stock-based compensation expense	92		96
Deferred income taxes	5		1
Loss on Blue Chip Swap	3		—
Changes in assets and liabilities:
Receivables	39		78
Inventories	(3)		—
Current payables and accrued expenses	(37)		(9)
Deferred revenue	(97)

SEC Form 10-Q filed by Teradata Corporation