SAN DIEGO – Teradata Corp. (NYSE: NYSE:) reported a slight beat on its first quarter adjusted earnings per share (EPS), coming in at $0.57 compared to analysts’ expectations of $0.55. Revenue for the quarter was in line with consensus estimates at $465 million.
Despite the positive earnings news, the company’s stock price saw a modest increase of 1.6%, suggesting a tempered investor response.
The company’s public cloud annual recurring revenue (ARR) showed significant growth, increasing by 36% in constant currency to $525 million compared to the same period last year. However, total ARR experienced a slight decline, decreasing by 2% to $1.480 billion.
Recurring revenue remained flat at $388 million, while total revenue saw a 2% decrease from the previous year to $465 million.
For the second quarter of 2024, Teradata anticipates adjusted EPS to be between $0.46 and $0.50, which at the midpoint is below the analyst consensus of $0.50. The company’s full-year 2024 guidance for adjusted EPS is set at $2.15 to $2.31, straddling the analyst consensus of $2.20.
Looking ahead, Teradata expects its total ARR to grow by 4% to 8% in constant currency for the full year, with public cloud ARR projected to increase by 35% to 41%.
Recurring revenue is forecasted to grow by 1% to 3%, and total revenue growth is anticipated to be between 0% and 2%, all in constant currency.
The company also projects cash flow from operations to be between $360 million and $400 million, with free cash flow estimated at $340 million to $380 million.
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President and CEO Steve McMillan expressed confidence in the company’s technology and its role in leveraging AI for business productivity and innovation. He emphasized the company’s commitment to improving execution and achieving long-term profitable growth targets.
CFO Claire Bramley highlighted the strong cloud net expansion rate of 123% and the company’s dedication to improving overall growth trajectory while delivering profitability and value to shareholders.
Investors appear to cautiously welcome the earnings beat, as reflected in the slight uptick in the stock price following the announcement. The company’s steady performance and optimistic outlook for cloud ARR growth suggest a focus on long-term strategies to bolster its position in the cloud analytics and data platform market.
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