TERADATA CORP /DE/ (TDC) Company Report

Teradata's CFO, John Ederer, noted the business has stabilized, with a focus on Teradata 3.0, emphasizing AI and becoming an Autonomous Knowledge Platform. The company is on track to complete 150 AI proof of concepts by the end of 2025 and launched AI Services in October.
The services business, which experienced negative gross margins in Q1 and Q2 2025, recovered to an 8.5% positive margin in Q3 2025. This segment is targeted to represent 10-15% of total revenue.
The company observes a shift in cloud migration discussions, with AI bringing security, governance, and scalability concerns to the forefront, leading some customers to consider hybrid or on-prem solutions. New logo activity has been seen in highly regulated industries and emerging markets, often preferring on-prem solutions.
Teradata has historically committed a high percentage of its free cash flow to share repurchases, reducing its share count from 180 million to 95-96 million. The company committed 50% of 2025 free cash flow to buybacks and re-upped its program with an additional $500 million. It is also open to technology tuck-in M&A to accelerate its product roadmap.
Total ARR growth returned to positive in Q2 and Q3 2025, with guidance for positive growth in Q4 2025. The company expects continued ARR growth and free cash flow benefits in 2026, aiming to become a "Rule of 40" business through growth and margin improvements.

1 day ago

Transcript

Teradata Outlines AI Strategy, Business Stabilization, and Capital Allocation

TDC

New Projects/Investments

Share Buyback

Revenue Acceleration/Inflection

Teradata is heavily focused on AI with its "Teradata 3.0" initiative, seeing AI influence its pipeline and expecting 150 proof of concepts by year-end.
The company launched AI Services in October to drive additional Annual Recurring Revenue (ARR) by helping customers implement AI solutions, leveraging a repurposing of its consulting business.
Teradata's business has stabilized in 2025, with total ARR growth returning to positive territory in Q2 and Q3 and expected positive growth in Q4, alongside improved consulting gross margins of 8.5% in Q3.
The company plans to continue returning value to shareholders through share repurchases, having re-upped its program for an additional $500 million, and is considering technology tuck-in M&A to accelerate its product roadmap.

1 day ago

Transcript

Teradata Corporation Announces New Stock Repurchase Program

TDC

Share Buyback

On November 17, 2025, Teradata Corporation's Board of Directors approved a new stock repurchase program.
This program authorizes the company to repurchase up to $500 million of its common stock.
The new program will become effective on January 1, 2026, and replaces an existing stock repurchase program that had approximately $242.7 million of authorization remaining as of November 7, 2025.

Nov 18, 2025, 2:04 PM

8-K

Teradata Announces Q3 2025 Financial Results and Updates FY25 Outlook

TDC

Earnings

Guidance Update

Share Buyback

Teradata reported Q3 2025 total revenue of $416 million, a 5% year-over-year decrease, and Non-GAAP diluted EPS of $0.72, up from $0.69 in Q3 2024.
Public Cloud ARR grew 11% year-over-year to $633 million, now representing 42% of the total ARR of $1.490 billion.
For the last twelve months (LTM25), Non-GAAP Diluted EPS was $2.38 and Free Cash Flow was $282 million.
The company projects FY25 Non-GAAP diluted EPS in the range of $2.38 to $2.42 and Free Cash Flow of $260 million to $280 million.
Teradata repurchased $30 million in stock during Q3 2025, contributing to $102 million in year-to-date 2025 stock repurchases.

Nov 4, 2025, 9:30 PM

Presentation

Teradata Reports Strong Q3 2025 Earnings, Raises FY25 EPS Guidance

TDC

Earnings

Guidance Update

New Projects/Investments

Teradata reported non-GAAP diluted earnings per share of $0.72 for Q3 2025, exceeding its outlook, and generated $88 million in free cash flow, marking a 28% year-over-year increase.
The company achieved its second consecutive quarter of positive total ARR growth, reaching 1% as reported and flat in constant currency, ahead of its initial Q4 target. Cloud ARR grew 11% as reported and in constant currency, with a net expansion rate of 109%.
For fiscal year 2025, Teradata raised its non-GAAP diluted EPS guidance to a range of $2.38-$2.42 and narrowed its free cash flow outlook to $260 million-$280 million.
Teradata is pivoting towards AI services and leveraging its hybrid environment capabilities to support customers' AI workloads, with a significant increase in AI-fueled projects in its pipeline.

Nov 4, 2025, 9:30 PM

Transcript

Teradata Reports Q3 2025 Financial Results and Updates Full-Year Outlook

TDC

Earnings

Guidance Update

Demand Weakening

Teradata reported Q3 2025 GAAP diluted EPS of $0.42 and non-GAAP diluted EPS of $0.72.
Total revenue for Q3 2025 was $416 million, a decrease of 5% as reported, while Total ARR reached $1.490 billion, an increase of 1% as reported.
Public cloud ARR increased to $633 million, an 11% increase as reported and in constant currency, in Q3 2025.
The company generated $94 million in cash flow from operations and $88 million in Free Cash Flow in Q3 2025.
Teradata updated its full-year 2025 outlook, with GAAP diluted EPS expected between $1.22 and $1.26 and non-GAAP diluted EPS between $2.38 and $2.42. The company also reaffirmed its full-year outlook for Total ARR (flat to 2% growth) and Public Cloud ARR growth (14% to 18%).

Nov 4, 2025, 9:11 PM

8-K

Teradata Reports Third Quarter 2025 Financial Results

TDC

Earnings

Guidance Update

Demand Weakening

Teradata reported Q3 2025 financial results with Total ARR of $1.490 billion, an increase of 1% as reported, and Public cloud ARR of $633 million, an increase of 11% as reported.
For Q3 2025, the company achieved GAAP diluted EPS of $0.42 and non-GAAP diluted EPS of $0.72.
Total revenue for Q3 2025 was $416 million, a decrease of 5% as reported, while recurring revenue was $366 million, a decrease of 2% as reported.
Cash flow from operations was $94 million and Free Cash Flow was $88 million in Q3 2025.
Teradata updated its full-year 2025 outlook, expecting GAAP diluted EPS in the range of $1.22 to $1.26 and non-GAAP diluted EPS in the range of $2.38 to $2.42 per share. The company also reaffirmed its full-year outlook for Total ARR (flat to 2% year-over-year in constant currency) and Public cloud ARR growth (14% to 18% year-over-year in constant currency).

Nov 4, 2025, 9:05 PM

Press Release

Earnings Transcripts

Quarterly earnings call transcripts for TERADATA CORP /DE/.

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