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Jun 30, 2020

Teradata Q2 2020 Earnings Report

Teradata exceeded expectations in Q2 2020, demonstrating resilience amidst the COVID-19 pandemic.

Key Takeaways

Teradata reported second-quarter revenue of $457 million, exceeding expectations. The company achieved 8% ARR growth, strong recurring revenue growth, significant free cash flow, and solid earnings per share. Despite a net loss of $(43) million under GAAP, non-GAAP net income was $26 million, or $0.24 per diluted share.

Second-quarter results exceeded Company expectations on key revenue, profit and cash flow metrics

Annual Recurring Revenue (ARR) increased 8% reported and 9% in constant currency from the same period of the prior year

Second-quarter recurring revenue of $358 million exceeded Company’s guidance range

Operating cash flow improved to $130 million and free cash flow totaled $115 million

Total Revenue
$457M
Previous year: $478M
-4.4%
EPS
$0.24
Previous year: $0.29
-17.2%
GAAP Gross Margin
56%
Previous year: 49.4%
+13.4%
Non-GAAP Gross Margin
58.9%
Previous year: 52.7%
+11.8%
GAAP Operating Margin
1.8%
Previous year: 2.1%
-14.3%
Gross Profit
$256M
Cash and Equivalents
$494M
Free Cash Flow
$115M
Total Assets
$2.1B

Teradata

Teradata

Teradata Revenue by Segment

Teradata Revenue by Geographic Location

Forward Guidance

For the third quarter of 2020, Teradata expects recurring revenue between $359 million and $361 million. GAAP loss / earnings per share in the third quarter of 2020 is expected to be in the range of $(0.03) and $0.00. Non-GAAP earnings per share, excluding stock-based compensation expense and other special items, in the third quarter is expected to be in the $0.28 to $0.31 range.

Revenue & Expenses

Visualization of income flow from segment revenue to net income