Slide 1: Q1'24 Earnings Results
May 2024 Q1’24 Earnings Results Teradata Investor Relations © 2024 Teradata. All rights reserved. Internal use only
Slide 2: Forward-looking statements and Non-GAAP Financial Measures
Forward-looking statements Non-GAAP Financial Measures This presentation and the accompanying discussion or restructuring and cost saving initiatives; risks inherent This presentation and the accompanying discussion contain forward-looking statements within the meaning in operating in foreign countr
Slide 3: Teradata – at a glance
Teradata – at a glance Corporate purpose What we do How we do it We believe people thrive when We are the most complete cloud We deliver harmonized data, empowered with trusted analytics and data platform for AI trusted AI/ML, and faster innovation information for better decision-making Financial Ov
Slide 4: Q1'24 Financials
Q1’24 Financials © 2024 Teradata. All rights reserved. 4
Slide 5: Teradata – by the numbers Q1'24
Teradata – by the numbers Q1’24 Public Cloud ARR Total ARR Recurring Revenue Total Revenue $525M $1.480B $388M $465M + 35% YoY - 2% YoY 0% YoY - 2% YoY + 36% YoY in CC - 1% YoY in CC + 1% YoY in CC - 1% YoY in CC Notes: Total annual recurring revenue (ARR) is defined as the annual value at a point i
Slide 6: Teradata – by the numbers Q1'24 (EPS and cash flow)
Teradata – by the numbers Q1’24 Non-GAAP Diluted GAAP Earnings per Share Earnings per Share(1) Cash Flow from Operations Free Cash Flow(1) $0.20 $0.57 $27M $21M - from $0.39 in Q1’23 - from $0.61 in Q1’23 - from $109M in Q1’23 - from $105M in Q1’23 NOTES: (1) on-GAAP diluted earnings per share and f
Slide 7: ARR by product
ARR by product 1,570 1,506 1,523 1,524 1,480 1,482 173 1,390 1,374 233 198 139 $1.480B 281 259 323 293 869 816 876 872 844 859 - 2% YoY 802 833 - 1% YoY in CC 35% Cloud ARR as a % 454 528 525 357 388 414 of Total ARR 234 279 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Cloud Subscription Maint &
Slide 8: Cloud ARR & TTM Net Expansion Rate
Cloud ARR & TTM Net Expansion Rate 530 130% 520 510 500 $525M 490 480 470 460 450 124% 440 430 123% 123% 420 410 400 121% 390 + 35% YoY 380 370 360 119% 120% 350 + 36% YoY in CC 340 330 320 117% 117% 117% 310 300 123% 290 Net Expansion Rate 280 270 260 250 240 230 220 210 200 234 279 357 388 414 454
Slide 9: Revenue by type
Revenue by type 1,822 1,775 291 301 $465M 476 465 40 452 462 457 52 430 438 417 74 78 69 78 73 77 13 71 8 72 17 13 12 8 7 14 - 2% YoY in Q1’24 1,491 - 1% CC in Q1’24 1,422 357 389 371 360 372 388 345 331 83% Recurring Revenue as a % of Total Revenue Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 LT
Slide 10: Q1'24 revenue by region
Q1’24 revenue by region AMS EMEA APJ Total Total Total $277M $125M $63M - 5% YoY + 7% YoY - 6% YoY - 3% YoY in CC + 6% YoY in CC 0% CC 88% Recurring Revenue as a % of Total Revenue 79% Recurring Revenue as a % of Total Revenue 71% Recurring Revenue as a % of Total Revenue Notes: Amounts in U.S. Doll
Slide 11: Gross Margin
$300 78% Gross Margin ($M) Non-GAAP gross margin 75% $200 73% 73% 72% 72% 72% 72% Recurring 73% 71% $100 $0 68% Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Total Gross Margin % of Revenue $400 $15 33% 40% Gross Margin ($M) 29% 29% 64% Perpetual 65% 63% $10 $300 62% 62% 15% 61% 61% 13% 20% and Ot
Slide 12: Non-GAAP operating expenses
Non-GAAP operating expenses SG&A R&D 160 40% 75 20% 73 150 32% 32% 32% 71 31% 30% 17% 17% 28% 29% 29% 69 16% 140 30% 67 15% 130 65 14% 14% 14% 63 13% 120 20% 61 110 59 136 135 145 134 141 133 131 134 57 72 72 62 64 67 68 63 66 100 10% 55 10% Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 Q2'22 Q3'2
Slide 13: Non-GAAP operating margin & earnings per share
Non-GAAP operating margin & earnings per share Non-GAAP Operating Margin Earnings per Share $150 23% 25% 2.03 $2.00 19% 19% 20% 1.59 16% $1.50 $100 14% 14% 13% 13% 15% $1.00 10% $50 0.61 0.57 $0.50 0.36 0.42 0.39 5% 0.20 $0 0% $0.00 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Q3'23 Q4'23 Q1'24 LTM'23 LTM'24 Q1'23
Slide 14: Free cash flow & capital allocation
Free cash flow & capital allocation 377 358 Q1’24 Capital Allocation 293 Stock repurchase 271 $124M 109 105 Approximately 3.2 million shares 27 Return of Q1’24 FCF = 590% 21 Target = at least 75% return of LTM'23 LTM'24 Q1'23 Q1'24 FY24 FCF Cash from Operations Free Cash Flow Notes: Amounts in U.S.
Slide 15: Select cash and debt balances
Select cash and debt balances Net Cash (Debt) $800 $ Millions Q1’23 Q2’23 Q3’23 Q4’23 Q1’24 $600 $400 Cash and cash $ 551 $ 504 $ 348 $ 486 $ 337 equivalents $200 $ Millions $- Total debt $ (498) $ (498) $ (498) $ (499) $ (499) $(200) $(400) Finance lease $(600) $ (132) $ (140) $ (139) $ (129) $ (12
Slide 16: 2024 Financial Outlook
2024 Financial Outlook © 2024 Teradata. All rights reserved. 16
Slide 17: FY24 financial outlook
FY24 financial outlook FY24 Outlook Q2’24 Outlook Public cloud ARR Total ARR GAAP diluted EPS YoY growth of 35% to 41% in CC YoY growth of 4% to 8% in CC $0.17 to $0.21 Recurring revenue Total revenue Non-GAAP diluted EPS YoY growth of 1% to 3% in CC YoY growth of flat to 2% in CC $0.46 to $0.50 Non
Slide 18: FY24 key modeling assumptions
FY24 key modeling assumptions Non-GAAP Tax Rate WASO 24.2% 98.5 million Return of FCF Other Expense Target at least 75% Approximately $50 million © 2024 Teradata. All rights reserved. 18
Slide 19: Path to FY25 $1B Cloud ARR Goal
Path to FY25 $1B Cloud ARR Goal Assumptions of 120%* net expansion rate = ~$250M* $1,000+ 1000 900 FY24 & FY25 total migrations, expansion at the point of migration & new logos = ~$225M* 800 700 600 $528 500 400 $357 300 $202 200 100 Notes: 2021 2022 2023 2024E 2025E * Represents Teradata forecasts
Slide 20: We have a significant opportunity to increase shareholder value
We have a significant opportunity to increase shareholder value Capture Accelerate growth in larger Scalable the future market opportunity financial model Best-of-breed technology Investing in growth Recurring revenue growth Differentiated Opportunities to lead in large Efficient operating models ma
Slide 21: Industry and ESG Recognition
Industry and ESG Recognition © 2024 Teradata. All rights reserved. 21
Slide 22: Teradata ranked #1 again in Gartner Critical Capabilities
Gartner® Critical Capabilities for Cloud Database Management Systems for Analytical Use Cases Teradata ranked #1 again in the Gartner® Critical Capabilities report for Logical Data Warehouse and Traditional Data Warehouse† use cases We help organizations unleash the value of their data through: • th
Slide 23: Teradata named a leader in Enterprise Data Fabric
The Forrester Wave™: Enterprise Data Fabric, Q1 2024 Teradata named a leader in Enterprise Data Fabric, recognized for: • “A clear, differentiated vision that focuses on intelligent processing, democratizing data, accelerating time to value, empowering users, agile data onboarding, and semantic know
Slide 24: Teradata named a Leader in Cloud Data Warehouses
The Forrester Wave™: Cloud Data Warehouses, Q2 2023 Teradata named a Leader in Cloud Data Warehouses “Teradata has exceptional analytics at scale and a strong vision…Teradata’s strong vision focuses on a strategy that includes AI/ML at scale, integrated data plane, data fabric, data mesh, semantic m
Slide 25: Teradata wins BIG!
Teradata wins BIG! Teradata consistently garners industry recognition, securing top honors across the board for our innovative products and customer dedication. With accolades from TrustRadius, G2, and Constellation Research, we're celebrated for our pioneering solutions in data warehousing and anal
Slide 26: Teradata is strongly committed to ESG
Teradata is strongly committed to ESG Accolades Recognition Affiliations © 2024 Teradata. All rights reserved. 26
Slide 27: Appendix
Appendix © 2024 Teradata. All rights reserved. 27
Slide 28: Impacts to ARR and Revenue
Impacts to ARR and Revenue ARR Q1 Q2 Q3 Q4 FY22 Q1 Q2 Q3 Q4 FY23 Q1 2022 2022 2022 2022 2023 2023 2023 2023 2024 Reported YoY Growth Rate 2% -3% -4% -1% -1% 6% 10% 11% 6% 6% -2% Positive/(Negative) on Reported YoY Growth Rate: FX -1% -4% -4% -3% -3% -1% 1% 2% 1% 1% -1% Russia -4% -4% -4% -4% -4% 0%
Slide 29: GAAP to Non-GAAP Reconciliations and Additional Information
GAAP to Non-GAAP Reconciliations and Additional Information Use of Non-GAAP Measures Teradata reports its results in accordance with GAAP. However, as described below, the Company believes that certain non- GAAP measures such as free cash flow, non-GAAP gross profit, non-GAAP operating income, non-G
Slide 30: Three months ended March 31, 2024 and 2023
GAAP to Non-GAAP Reconciliation Three months ended March 31, 2024 and 2023 Amounts in U.S. Dollars in Millions, except per share amounts. Amounts are unaudited. NOTES: 1. While Teradata reports its results using generally accepted accounting principles in the U.S. (GAAP), certain non-GAAP financial
Slide 31: Three months ended December 31, 2023 and 2022
GAAP to Non-GAAP Reconciliation Three months ended 2023 2022 Stock-based Other Stock-based Other % Change Compensation Special Compensation Special Non-GAAP GAAP Expense Items 2 Non-GAAP 1 GAAP Expense Items 3 Non-GAAP 1 Yr/Yr December 31, Revenue Recurring Perpetual software licenses, hardware and
Slide 32: Three months ended September 30, 2023 and 2022
GAAP to Non-GAAP Reconciliation Three months ended 2023 2022 Stock-based Other Stock-based Other % Change Compensation Special Compensation Special Non-GAAP 2 1 3 1 GAAP Expense Items Non-GAAP GAAP Expense Items Non-GAAP Yr/Yr September 30, Revenue Recurring Perpetual software licenses, hardware and
Slide 33: Three months ended June 30, 2023 and 2022
GAAP to Non-GAAP Reconciliation Three months ended Stock-based Compensation 2023 Other Special Stock-based Compensation 2022 Other Special % Change Non-GAAP June 30, 2023 2 1 3 1 GAAP Expense Items Non-GAAP GAAP Expense Items Non-GAAP Yr/Yr Revenue Recurring $ 371 $ - $ - $ 371 $ 345 $ - $ - $ 345 8
Slide 34: Three months ended March 31, 2023 and 2022
GAAP to Non-GAAP Reconciliation Three months ended Stock-based Compensation 2023 Other Special 2 1 Stock-based Compensation 2022 Other Special 3 1 % Change Non-GAAP March 31, 2023 GAAP Expense Items Non-GAAP GAAP Expense Items Non-GAAP Yr/Yr Revenue Recurring $ 389 $ - $ - $ 389 $ 386 $ - $ - $ 386
Slide 35: Twelve months ended December 31, 2023 and 2022
GAAP to Non-GAAP Reconciliation Twelve months ended 2023 2022 December 31, Stock-based Other Stock-based Other % Change Compensation Special Compensation Special Non-GAAP GAAP Expense Items 2 Non-GAAP 1 GAAP Expense Items 3 Non-GAAP 1 Yr/Yr 2023 and 2022 Revenue Recurring $ 1,492 $ - $ - $ 1,492 $ 1
Slide 36: Earnings per share
GAAP to Non-GAAP Reconciliation Earnings per share NOTES: i. Represents the income tax effect of the pre-tax adjustments to reconcile GAAP to Non-GAAP income based on the applicable jurisdictional statutory tax rate of the underlying item. Including the income tax effect assists investors in underst
Slide 37: Free cash flow reconciliation – March 31, 2024 and 2023
GAAP to Non-GAAP Reconciliation Free cash flow reconciliation – March 31, 2024 and 2023 NOTES: The Company believes that free cash flow is a useful non-GAAP measure for investors. Free cash flow does not have a uniform definition under GAAP in the United States and therefore, Teradata's definition m
Slide 38: Thank you
Thank you © 2024 Teradata. All rights reserved.
Slide 39: Slide 39