tdc-20240630

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 June 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 July 26, 2024, the registrant had approximately 96.1 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 Six Months Ended June 3 0 , 2024 and 2023	4

	Condensed Consolidated Statements of Comprehensive Income (Unaudited) Three and Six Months Ended June 3 0 , 2024 and 2023	5

	Condensed Consolidated Balance Sheets (Unaudited) June 3 0 , 2024 and December 31, 2023	6

	Condensed Consolidated Statements of Cash Flows (Unaudited) Si x Months Ended June 3 0 , 2024 and 2023	7

	Condensed Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) Three and Six Months Ended June 3 0 , 2024 and 2023	8

	Notes to Condensed Consolidated Financial Statements (Unaudited)	9

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	32

Item 4.	Controls and Procedures	33

PART II—OTHER INFORMATION

	Description	Page

Item 1.	Legal Proceedings	33

Item 1A.	Risk Factors	33

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	34

Item 3.	Defaults Upon Senior Securities	34

Item 4.	Mine Safety Disclosures	34

Item 5.	Other Information	34

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 June 30,				Six Months Ended June 30,
In millions, except per share amounts	2024		2023		2024		2023
Revenue
Subscription software licenses	$	73	$	70	$	163	$	174
Services and other	295		301		593		586
Total recurring	368		371		756		760
Perpetual software licenses, hardware and other	5		13		13		26
Consulting services	63		78		132		152
Total revenue	436		462		901		938
Cost of revenue
Subscription software licenses	5		5		10		11
Services and other	105		102		212		194
Total recurring	110		107		222		205
Perpetual software licenses, hardware and other	5		12		13		23
Consulting services	56		67		117		132
Total cost of revenue	171		186		352		360
Gross profit	265		276		549		578
Operating expenses
Selling, general and administrative expenses	131		167		292		320
Research and development expenses	68		76		143		146
Total operating expenses	199		243		435		466
Income from operations	66		33		114		112
Other expense, net
Interest expense	(7)		(7)		(15)		(14)
Interest income	2		8		6		15
Other expense	(6)		(10)		(18)		(31)
Total other expense, net	(11)		(9)		(27)		(30)
Income before income taxes	55		24		87		82
Income tax expense	18		7		30		25
Net income	$	37	$	17	$	57	$	57
Net income per common share
Basic	$	0.38	$	0.17	$	0.59	$	0.56
Diluted	$	0.38	$	0.17	$	0.58	$	0.55
Weighted average common shares outstanding
Basic	96.5		101.0		97.0		101.2
Diluted	97.4		102.9		98.9		103.3

See Notes to Condensed Consolidated Financial Statements (Unaudited).

Teradata Corporation

Condensed Consolidated Statements of Comprehensive Income (Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
In millions	2024		2023		2024		2023
Net income	$	37	$	17	$	57	$	57
Other comprehensive income (loss):
Foreign currency translation adjustments	(5)		(3)		(15)		—
Unrealized gain (loss) on cross-currency net investment hedge, before tax	2		(2)		5		(3)
Unrealized gain (loss) on cross-currency net investment hedge, tax portion	—		—		(1)		—
Total currency translation adjustments	(3)		(5)		(11)		(3)
Derivatives:
Unrealized gain on derivatives, before tax	1		9		6		3
Unrealized gain on derivatives, tax portion	(1)		(2)		(2)		(1)
Unrealized gain on derivatives, net of tax	—		7		4		2
Defined benefit plans:
Defined benefit plan adjustment, before tax	2		2		4		4
Defined benefit plan adjustment, tax portion	—		(1)		(1)		(1)
Defined benefit plan adjustment, net of tax	2		1		3		3
Other comprehensive (loss) income	(1)		3		(4)		2
Comprehensive income	$	36	$	20	$	53	$	59

See Notes to Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

Teradata Corporation

Condensed Consolidated Balance Sheets (Unaudited)


In millions, except per share amounts	June 30, 2024		December 31, 2023
Assets
Current assets
Cash and cash equivalents	$	301	$	486
Accounts receivable, net	248		286
Inventories	22		13
Other current assets	94		84
Total current assets	665		869
Property and equipment, net	209		239
Right of use assets - operating lease, net	7		9
Goodwill	395		398
Capitalized contract costs, net	52		68
Deferred income taxes	206		221
Other assets	88		69
Total assets	$	1,622	$	1,873
Liabilities and stockholders’ equity
Current liabilities
Current portion of long-term debt	$	25	$	19
Current portion of finance lease liability	62		66
Current portion of operating lease liability	4		6

Accounts payable	85		100
Payroll and benefits liabilities	85		130
Deferred revenue	529		570
Other current liabilities	99		105
Total current liabilities	889		996
Long-term debt	467		480
Finance lease liability	48		63
Operating lease liability	4		6
Pension and other postemployment plan liabilities	93		102
Long-term deferred revenue	10		22
Deferred tax liabilities	7		8
Other liabilities	29		61
Total liabilities	1,547		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 June 30, 2024 and December 31, 2023, respectively	—		—
Common stock: par value $0.01 per share, 500.0 shares authorized, 96.2 and 97.9 shares issued at June 30, 2024 and December 31, 2023, respectively	1		1
Paid-in capital	2,131		2,074

Accumulated deficit	(1,924)		(1,811)
Accumulated other comprehensive loss	(133)		(129)
Total stockholders’ equity	75		135
Total liabilities and stockholders’ equity	$	1,622	$	1,873

See Notes to Condensed Consolidated Financial Statements (Unaudited).

Table of Contents

Teradata Corporation

Condensed Consolidated Statements of Cash Flows (Unaudited)


	Six Months Ended June 30,
In millions	2024		2023
Operating activities
Net income	$	57	$	57
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	53		59
Stock-based compensation expense	63		63
Deferred income taxes	8		2
Loss on Blue Chip Swap	3		—
Changes in assets and liabilities:
Receivables	38		99
Inventories	(9)		(1)
Current payables and accrued expenses	(64)		(30)
Deferred revenue	(53)		(64)
Other assets and liabilities	(26)		(27)
Net cash provided by operating activities	70		158
Investing activities
Expenditures for property and equipment	(9)		(6)

Additions to capitalized software	(1)		(1)

Other investing activities, net

SEC Form 10-Q filed by Teradata Corporation