Slide 1: Q3'22 Earnings Results
Q3’22 Earnings Results Teradata Investor Relations November 2022 The Connected Multi-Cloud Data Platform for Enterprise Analytics
Slide 2: Forward-Looking Statements Non-GAAP Financial Measures
Forward-Looking Statements Non-GAAP Financial Measures This presentation and the accompanying discussion foreign currency fluctuations, and/or acts of war; risks This presentation and the accompanying discussion contain forward-looking statements within the associated with the ongoing and uncertain
Slide 3: Teradata - At a Glance
3 ©2021 Teradata Teradata - At a Glance Corporate Purpose We transform how businesses work and people live through the power of data We are The connected multi-cloud data platform for enterprise analytics 1 The leading multi-cloud data platform from start to scale 2 The most effective platform for d
Slide 4: Teradata - By the Numbers Q3'22
Teradata - By the Numbers Q3’22 $279 million 99% year-over-year in CC, 89% year-over-year Public cloud ARR $1.374 billion 0% year-over-year in CC, 4% year-over-year Total Annual Recurring Revenue (ARR) $331 million 2% year-over-year in CC, 6% year-over-year Recurring revenue $417 million 4% year-ove
Slide 5: Teradata - By the Numbers Q3'22
Teradata - By the Numbers Q3’22 $0.08 in Q3’22 from $0.15 in Q3’21 GAAP diluted earnings per share $0.31 in Q3’22 from $0.43 in Q3’21 Non-GAAP diluted earnings per share(1) $34 million in Q3’22 from $33 million in Q3’21 Cash flow from operations $31 million in Q3’22 from $23 million in Q3’21 Free ca
Slide 6: Impacts to ARR and Revenue
Impacts to ARR and Revenue ARR Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Reported YoY Growth Rate 12% 9% 7% 5% 2% -3% -4% Positive/(Negative) on Reported YoY Growth Rate: FX 3% 2% 1% -2% -1% -4% -4% Russia 0% 0% 0% 0% -4% -4% -4% Total Revenue Q1 2021 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2
Slide 7: ARR by Product $1.374B
ARR by Product 1,492 1,425 1,404 1,426 1,437 1,427 1,390 1,374 392 409 343 323 293 490 456 426 $1.374B 802 898 876 833 0% YoY CC 860 880 829 824 -4% YoY 202 209 234 279 106 124 139 148 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Cloud Subscription Maint & SW Upgrade Rights Q4’20 Q1’21 Q2’21 Q3’2
Slide 8: Revenue by Type $417M
Revenue by Type 491 491 491 496 460 475 84 430 417 111 96 98 92 $417M 34 23 17 90 18 19 26 77 8 72 14 -4% CC in Q3’22 -9% YoY in Q3’22 372 376 364 386 346 352 345 331 RECURRING REVENUE AS A % OF TOTAL REVENUE - 79% Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Recurring Perpetual Consulting Q4’20
Slide 9: Q3'22 Revenue by Region
Q3’22 Revenue by Region AMS EMEA APJ TOTAL TOTAL TOTAL $242M $105M $70M -1% CC -13% CC 0% CC -3% YoY -21% YoY -10% YoY RECURRING REVENUE RECURRING REVENUE RECURRING REVENUE AS A % OF AS A % OF AS A % OF TOTAL REVENUE TOTAL REVENUE TOTAL REVENUE 86% 73% 67% NOTES: Amounts in U.S. Dollars in Millio
Slide 10: Gross Margin ($M)
$300 78% 79% Non-GAAP Gross Margin Gross Margin ($M) 77% 78% 77% 76% 75% $200 75% 74% 76% 75% 73% 73% 74% Recurring $100 73% 72% 71% $0 70% Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Total Gross Margin % of Revenue $325 64% 65% $20 52% 60% Gross Margin ($M) 47% 47% 63% 63% 63% $15 39% 63% 35% 3
Slide 11: Non-GAAP Operating Expenses
Non-GAAP Operating Expenses SG&A R&D 76 160 74 150 32% 32% 35% 72 31% 30% 30% 17% 17% 26% 27% 26% 70 140 16% 25% 68 130 15% 66 14% 14% 14% 120 14% 15% 64 110 62 150 130 132 139 144 129 136 135 74 70 69 72 66 68 72 72 100 5% 60 12% Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'20 Q1'21 Q2'21 Q3'
Slide 12: Non-GAAP Operating Margin & Earnings Per Share
Non-GAAP Operating Margin & Earnings Per Share Non-GAAP Operating Margin Earnings Per Share 140 24% 23% 23% 1.86 120 19% $1.55 100 1.30 15% 14% 80 13% 13% 1.01 $0.95 60 0.38 0.43 40 0.31 $0.35 0.15 0.08 20 0 -$0.25 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 YTD'21 YTD'22 Q3'21 Q3'22 Operating I
Slide 13: Free Cash Flow & Capital Allocation
Free Cash Flow & Capital Allocation YTD’22 Capital Allocation 463 Q3’22 Capital Allocation 432 Stock repurchase 290 283 Stock repurchase $348M $31M Approximately 8.2 million shares Approximately 1.0 million shares Return of YTD’22 33 23 34 31 FCF = 123% FY21 YTD FY22 Q3'21 Q3'22 Target = At least 50
Slide 14: Select Cash and Debt Balances
Select Cash and Debt Balances Net Cash (Debt) $700 $ Millions Q3'21 Q4'21 Q1’22 Q2’22 Q3’22 Cash and cash $ 613 $ 592 $ 404 $ 545 $ 506 equivalents $ Millions $0 Total debt $ (424) $ (412) $ (399) $ (497) $ (498) Finance lease $ (139) $ (130) $ (132) $ (118) $ (111) liabilities ($700) Q3’21 Q4'21 Q1
Slide 15: Financial Outlook
Financial Outlook FY22 Outlook Public cloud ARR Total ARR to decline Recurring revenue Total revenue Non-GAAP EPS Free cash flow growth of in the low-to-mid- to decline in the low- to decline in the mid- in the range of of approximately approximately 80% single-digit % range to-mid-single-digit % to
Slide 16: Teradata's long-standing commitment to ESG is clear and unwavering
Teradata’s long-standing commitment to ESG is clear and unwavering (1) 1. Named to "Barron’s 100 Most Sustainable Companies” published in February 2022. 16 ©2022 Teradata
Slide 17: Teradata's leadership team
Teradata’s leadership team Steve McMillan Hillary Ashton Claire Bramley Stephen Brobst Nicolas Chapman President and Chief Product Officer Chief Financial Officer Chief Technology Officer Chief Strategy Officer Chief Executive Officer Todd Cione Kathy Cullen-Cote Michael Hutchinson Molly Treese Jacq
Slide 18: We have a significant opportunity to increase shareholder value
We have a significant opportunity to increase shareholder value Capture • Best-of-breed technology Long-Term the Future • Differentiated Value Creation • Continued innovation • Investing in growth Accelerate Growth in Sustainable • Opportunities to lead Large Market Opportunity Revenue Growth in lar
Slide 19: The connected multi-cloud data platform for enterprise analytics
The connected multi-cloud data platform for enterprise analytics. Profitable growth Unique connected Strong competitive Over $1B cloud Delivering value cloud company data platform position in a ARR and ~ $550M to customers large market FCF in FY25* and shareholders * Teradata forecasts for fiscal 20
Slide 20: Appendix
Appendix 20 ©2022 Teradata
Slide 21: 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-GA
Slide 22: GAAP to Non-GAAP Reconciliation for the three months ended September 30, 2022 and 2021
GAAP to Non-GAAP Reconciliation for the three months ended September 30, 2022 and 2021 2022 2021 Stock-based Other Stock-based Other % Change Compensation Special Compensation Special Non-GAAP Amounts in U.S. Dollars in Millions, except per share amounts. GAAP Expense Items 2 Non-GAAP 1 GAAP Expense
Slide 23: GAAP to Non-GAAP Reconciliation for the three months ended June 30, 2022 and 2021
GAAP to Non-GAAP Reconciliation for the three months ended June 30, 2022 and 2021 2022 2021 Equity Other Equity Other % Change Compensation Special Compensation Special Non-GAAP Amounts in U.S. Dollars in Millions, except per share amounts. 2 GAAP Expense Items Non-GAAP 1 GAAP Expense Items 3 Non-GA
Slide 24: GAAP to Non-GAAP Reconciliation for the three months ended March 31, 2022 and 2021
GAAP to Non-GAAP Reconciliation for the three months ended March 31, 2022 and 2021 2022 2021 Equity Other Equity Other % Change Amounts in U.S. Dollars in Millions, except per share amounts. Compensation Special Compensation Special Non-GAAP Amounts are unaudited. GAAP Expense Items 2 Non-GAAP 1 GAA
Slide 25: GAAP to Non-GAAP Reconciliation for the three months ended December 31, 2021 and 2020
GAAP to Non-GAAP Reconciliation for the three months ended December 31, 2021 and 2020 2021 2020 Equity Other Equity Other Capitalized % Change Compensation Special Compensation Special Software Non-GAAP Amounts in U.S. Dollars in Millions, except per share amounts. Amounts are unaudited. GAAP Expens
Slide 26: Earnings Per Share
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 understanding the tax provision associa
Slide 27: Free cash flow reconciliation – September 30, 2022 and 2021
Free cash flow reconciliation – September 30, 2022 and 2021 NOTES: (1) 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 generally accepted accounting principles in the United States (GAAP) and therefore, Tera
Slide 28: Thank you.
Thank Thank you. you. ©2022 Teradata