Question · Q4 2025
Yitchuin Wong asked for more details on the impact of large deals in the fourth quarter, updates on deal cycle improvements or erosion observed last year, and how AI is influencing performance.
Answer
President and CEO Steve McMillan noted strength across industries and geographical distribution, particularly strong on-premise capabilities in international markets. He highlighted material improvements in retention rates in 2025 compared to 2024, expected to continue into 2026, driven by team execution and a product set that enhances stickiness with high-value AI solutions. CFO John Ederer confirmed significant improvements in consulting services gross margins, moving from negative to nearly 19% in Q4. He stated that AI services are expected to offset the decline in migration activity, stabilizing this part of the business, though the Q4 margin rate is not necessarily sustainable.
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