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Press Release: Teradata Reports Fourth-Quarter and Full-Year 2020 Financial Results

· 02/04/2021 16:05
1. The impact of currency is determined by calculating the prior-period results using the current-year monthly average currency rates (except for currency impact on ARR which is calculated using month-end rates). See the foreign currency fluctuation schedule, which is used to determine revenue on a constant currency ("CC") basis, on the Investor Relations page of the Company's website at investor.teradata.com Revenue (in millions) For the Three Months ended December 31 ----------------------------------------------------- % Change as % Change in 2020 2019 Reported CC ---------- ---------- --------------- ------------ Recurring revenue $ 383 $ 350 9% 8% Perpetual software licenses and hardware 25 30 (17)% (14)% Consulting services 83 114 (27)% (30)% --- ----- ------ Total revenue $ 491 $ 494 (1)% (2)% Americas $ 261 $ 263 (1)% 0% EMEA 134 139 (4)% (7)% APJ 96 92 4% (1)% --- ----- ------ Total revenue $ 491 $ 494 (1)% (2)% For the Twelve Months ended December 31 -------------------------------------------------------- % Change as 2020 2019 Reported % Change in CC ----------- ----------- -------------- -------------- Recurring revenue $ 1,451 $ 1,362 7% 7% Perpetual software licenses and hardware 73 106 (31)% (31)% Consulting services 312 431 (28)% (28)% ------- ------- Total revenue $ 1,836 $ 1,899 (3)% (3)% Americas $ 1,025 $ 1,057 (3)% (2)% EMEA 485 492 (1)% (2)% APJ 326 350 (7)% (7)% ------- ------- Total revenue $ 1,836 $ 1,899 (3)% (3)% As of December 31 -------------------------------------------------------- % Change as 2020 2019 Reported % Change in CC ----------- ----------- -------------- -------------- Annual recurring revenue* $ 1,587 $ 1,427 11% 9% Public cloud ARR** $ 106 $ 40 165% 159% * Annual recurring revenue (ARR) is defined as the annual value at a point in time of all recurring contracts, including subscription, software upgrade rights, maintenance and managed services. ** Public cloud ARR is defined as the annual value at a point in time of all contracts related to public cloud implementations of Teradata Vantage and does not include ARR related to private or managed cloud implementations. 2. As described below, the Company believes that free cash flow is a useful non-GAAP measure for investors. Teradata defines free cash flow as cash provided by / used in operating activities, less capital expenditures for property and equipment, and additions to capitalized software. Free cash flow does not have a uniform definition under GAAP and therefore, Teradata's definition may differ from other companies' definitions of this measure. Teradata's management uses free cash flow to assess the financial performance of the Company and believes it is useful for investors because it relates the operating cash flow of the Company to the capital that is spent to continue and improve business operations. In particular, free cash flow indicates the amount of cash generated after capital expenditures for, among other things, investment in the Company's existing businesses, strategic acquisitions, strengthening the Company's balance sheet, repurchase of the Company's stock and repayment of the Company's debt obligations, if any. Free cash flow does not represent the residual cash flow available for discretionary expenditures since there may be other nondiscretionary expenditures that are not deducted from the measure. This non-GAAP measure is not meant to be considered in isolation to, as a substitute for, or superior to, results determined in accordance with GAAP, and should be read only in conjunction with our condensed consolidated financial statements-- Public cloud ARR is expected to increase by at least 165% year-over-year -- GAAP diluted EPS is expected to be in the range of $0.11 to $0.13 -- Non-GAAP diluted EPS, excluding stock-based compensation expense, reorganization-related expenses and other special items, is expected to be in the range of $0.38 to $0.40(3)-- Public cloud ARR is expected to increase by at least 100% year-over-year -- Total ARR is expected to grow at a mid- to high-single-digit percentage year-over-year -- Recurring revenue is expected to grow at a mid- to high-single digit percentage year-over-year -- Total revenue is expected to grow at a low-single-digit percentage year-over-year -- GAAP diluted EPS is expected to be in the range of $0.43 to $0.51 -- Non-GAAP diluted EPS, excluding stock-based compensation expense, reorganization-related expenses and other special items, is expected to be in the range of $1.50 to $1.58(3)-- Recurring revenue was $1.451 billion, an increase of 7% both reported and in constant currency from $1.362 billion(1) -- GAAP gross margin was 55.5% versus 50.3% -- Non-GAAP gross margin was 58.4% versus 53.3%(3) -- GAAP operating income was $16 million versus $10 million -- Non-GAAP operating income was $230 million versus $183 million(3) -- GAAP diluted EPS was $1.16 versus loss per share of $0.18 -- Non-GAAP diluted EPS was $1.31 versus $1.05(3) -- Cash flow from operations was $267 million versus $148 million -- Free cash flow was $216 million versus $89 million(2)-- ARR increased 11% reported and 9% in constant currency to $1.587 billion from $1.427 billion(1) -- Public cloud ARR increased 165% reported and 159% in constant currency to $106 million from $40 million(1) -- Recurring revenue was $383 million versus $350 million, an increase of 9% reported and 8% in constant currency, and exceeded the Company's guidance of $371 million to $373 million(1) -- GAAP gross margin was 57.8% versus 50.2% -- Non-GAAP gross margin was 59.3% versus 53.2%(3) -- GAAP operating income was $13 million versus an operating loss of $5 million -- Non-GAAP operating income was $67 million versus $48 million(3) -- GAAP diluted EPS was $0.04 versus a loss of $0.17 per share -- Non-GAAP diluted EPS was $0.38 versus $0.22(3) -- Cash flow from operations was $56 million compared to $54 million -- Free cash flow was $45 million compared to $41 million(2)-- Annual recurring revenue (ARR) increased 11% from the prior year period(1) -- Public cloud ARR increased to $106 million, a 165% increase from the end of 2019(1) -- Fourth-quarter recurring revenue of $383 million exceeded the Company's guidance range -- Fourth-quarter earnings per diluted share (EPS), cash from operations and free cash flow(2) exceeded the Company's expectations SAN DIEGO--(BUSINESS WIRE)--February 04, 2021--

Teradata Reports Fourth-Quarter and Full-Year 2020 Financial Results

Teradata (NYSE: TDC) today announced its fourth-quarter and full-year 2020 financial results.

"Our Cloud-First focus has been recognized by our customers and the marketplace. Teradata achieved 165% growth in public cloud ARR year-over-year and received significant industry endorsement as a leading cloud data platform," said Steve McMillan, President and CEO, Teradata. "Our cloud momentum has contributed to another strong quarter of performance, as we exceeded quarterly expectations for recurring revenue, profitability and free cash flow."

"I am proud of the extraordinary resilience of our teams in 2020 and look forward to an even-stronger 2021. Companies must take advantage of all the data that is available to them to succeed, and we are steadfast in providing the enterprise scale and flexibility our customers need with our multi-cloud data platform. We are accelerating our cloud roadmap and bringing cloud-native integrations at a record pace, and we anticipate driving annual growth of at least 100% in cloud ARR, as well as year-over-year growth in total company revenue, profitability and free cash flow for Teradata in 2021."

Fourth-Quarter 2020 Financial Highlights compared to Fourth Quarter 2019

Full-Year 2020 Financial Highlights compared to Full Year 2019

Guidance

For the full year 2021:

For the first quarter of 2021:

Earnings Conference Call

A conference call is scheduled today at 2:00 p.m. PT to discuss the Company's fourth-quarter and full-year 2020 results and provide a business and financial update. Access to the conference call, as well as a replay of the conference call, is available on Teradata's website at investor.teradata.com.

Supplemental Financial Information

Additional information regarding Teradata's operating results is provided below as well as on Teradata's website at investor.teradata.com.

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February 04, 2021 16:05 ET (21:05 GMT)