The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Erik Woodring - Morgan Stanley & Co. LLC - Analyst
: Great. Thanks so much guys. Good afternoon. Steve, I just wanted to maybe take a step back. Obviously, you guys have talked about
cost efficiency programs. I'm wondering what the opportunity is to cut additional costs in this business. And really what I'm getting
at is the new logo engine is a relatively small part of the business, but you spend nearly twice as much on SG&A as you do on R&D.
You have a very large and very well renowned existing customer base.
Can you kind of attack that base and power your new logo engine with lower levels of total absolute OpEx spend? Because ultimately
what I'm trying to get at is ways other than growing your business that you could drive free cash flow higher. So that's just my first
question then I have a quick follow-up. Thanks so much.
Question: Erik Woodring - Morgan Stanley & Co. LLC - Analyst
: Okay. I appreciate that. Thank you, Steve. And then just quick follow-up was, just on the 2Q EPS guide. We're looking at a pretty
significant sequential decline. Can you just maybe help us understand or better understand some of the moving pieces as to why
we're getting there? Obviously, a very strong first quarter. Did you pull forward profitability, so to speak? Or just help us understand
why the shape of the curve in the first half looks the way it does on the EPS line? Thanks so much.
Question: Erik Woodring - Morgan Stanley & Co. LLC - Analyst
: Correct.
Question: Erik Woodring - Morgan Stanley & Co. LLC - Analyst
: All right. Thanks so much, guys. Good luck.
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MAY 06, 2025 / 8:30PM, TDC.N - Q1 2025 Teradata Corp Earnings Call
Question: Yitchuin Wong - Citigroup Global Markets Inc. - Analyst
: Hi. Thanks for taking my question here. Congrats on Sumeet's hiring and John from yesterday. It's been a while since we have the
full team again. So I remember the excitement three, four years ago when you have, like, Claire and Todd rounded up the team. I
guess back then, there were a lot of excitement, as well. Just in the three, four years, like, looking back in the executive management
team, can you tell me, like, what are some of the biggest lessons learned going into the this year and next year with Sumeet and
John in full now? And what would you be doing differently just given some of the execution issue in the past year and we'd like to
start there, please. Thanks.
Question: Yitchuin Wong - Citigroup Global Markets Inc. - Analyst
: Yeah. Looking forward to see that play out. I guess the other one on the product, you mentioned the hybrid is definitely picking up
steam. Longer term, how do you view the impact to the cloud? And then, what could we see kind of longer term trajectory? Do you
expect to see the subscription line and the cloud line? How would that trajectory kind of take keep us out going into next year?
Thanks.
Question: Yitchuin Wong - Citigroup Global Markets Inc. - Analyst
: Thanks.
Question: Howard Ma - Guggenheim Securities, LLC - Analyst
: Great. Thanks for taking the question. One for Steve. Steve, so when we think back to the period of cloud optimizations in the back
half of calendar 2022 and throughout 2023, I think most would agree that Teradata benefited from more customers expanding
on-prem, and subsequently, you just referred to the, that period as the 2.0 phase as your Vantage cloud product matured, you saw
a pretty nice expansion on that.
The question is, given the current macro uncertainty are there any parallels that you can draw compared to that that period in time?
And what are your customers indicating to you in terms of their intentions to expand, things like you guys mentioned, the new
vector store capability. Are those things giving you more visibility into expansions whether it's on-prem or in the cloud than perhaps
in the past or maybe not necessarily?
Question: Howard Ma - Guggenheim Securities, LLC - Analyst
: Got it. Thank you, Steve. And on the back of your response, I have a follow-up for Charles and it's just around the retention rates.
And if you could put some numbers around, the improvement, whether, they've been up year-over-year or sequentially and if the
idea, the prepared remarks that you gave, imply that retention rate should improve sequentially throughout this year, that where
the balance of this year? Thank you.
Question: Chirag Ved - Evercore ISI - Analyst
: Hi, thanks for taking the question. Steve, I was just wondering whether you could talk through some of the main points that give
you confidence in maintaining the total ARR and public cloud ARR guide and the acceleration in the back half of the year, just given
more cautious commentary across the board by many other peers in software? Thank you.
Question: Chirag Ved - Evercore ISI - Analyst
: All right. Thank you so much.
Question: Mike Richards - RBC Capital Markets, LLC - Analyst
: Hey guys. This is Mike Richards on for Matt. Maybe just piggybacking off that question there. Said differently, we came in the year
with a pragmatic guidance and seem conservative. Ex this new macro uncertainty that unfolded in the past 90 days of Liberation
Day, would it be unreasonable to think that, guidance could have been raised on this print? And so like we should look at the
maintained guide in as a conservative approach just given how you set it up coming into the year?
Question: Mike Richards - RBC Capital Markets, LLC - Analyst
: Great. Thanks. And then, just a quick follow-up. Could you remind us of your Fed exposure? And then any trends you've seen there
over the past quarter, specifically pertaining to Doge and any either buying ahead or pausing you might see in that vertical? Thanks
again, guys.
Question: Jared Jungjohann - TD Securities LLC - Analyst
: Hi team. This is Jared Jungjohann on for Derrick Wood. On the prior go to market changes, last quarter you noted reps have settled
into the new segment team. And now that we're another quarter down the road, can you just give us an update on some of the
benefits you're seeing? Thanks.
Question: Jared Jungjohann - TD Securities LLC - Analyst
: That's awesome. Good to hear. And then as a follow-up on that, how should we be thinking about the impacts from these AI related
products on revenue this year? I understand it's early and presume it would be pretty small, but any color on that would be great.
Thank you.
Question: Wamsi Mohan - Bank of America - Analyst
: Yeah. Thank you. I just wanted to get back to the full year guidance. You noted no meaningful direct impact from tariffs, but you
clearly have large customers in retail, for example and there seems to be a lot of uncertainty around a vertical like that where, tariffs
are having meaningful impact.
Could you just help us think through why maybe that doesn't slow down the path of increased uncertainty where maybe the
customers have to do some belt tightening? Is there enough slack across other verticals maybe where you're seeing increased
activity? Could you just share some color around maybe different verticals and what you're seeing today and what how you'd expect
that full year to progress? Thank you.
Question: Wamsi Mohan - Bank of America - Analyst
: Okay. Thanks, Steve. And if I could just follow-up, can you just give us any update if there is one around, what you're seeing from
some of your boomerang customers? Thank you.
Question: Sheldon McMeans - Barclays Capital Inc. - Analyst
: Hi, this is Sheldon McMeans on for Raimo. Thanks for taking our question. First for Steve. We were at the ServiceNow Analyst Day
this week and it was interesting to see you and some of the other leaders in the data analytics space, up on the big screen talking
about your role in AI agent space. You talk you mentioned a little bit on the call, but would love to hear, from your perspective, how
do you see the role of data warehouses, data lake providers like yourself in that ecosystem?
And then as we think about maybe this is a little bit of a shift to more on the transactional side or on operational side as opposed to
analytical. And so we'd love to hear your thoughts on how that will play out.
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MAY 06, 2025 / 8:30PM, TDC.N - Q1 2025 Teradata Corp Earnings Call
Question: Sheldon McMeans - Barclays Capital Inc. - Analyst
: Understood. Thanks. And a quick follow-up. Another one on the retention front. Can you kind of help us understand how you think
about the improvements of retention on a shifting customer perspective around Teradata and some of the things you're doing on
the cloud? And then, more on maybe the execution side where the customer success team is getting closer to the customer and
improving execution.
Question: Pat Walravens - Citizens JMP Securities, LLC - Analyst
: Great. Thank you very much. So Steve, I really like your hire of John Ederer. I've covered it, I think, three companies in the past. So
can I ask, you know, what was it about that candidate that caused him to rise to the top of the list? What is it that you were looking
for that you saw in his background or skill set?
Question: Pat Walravens - Citizens JMP Securities, LLC - Analyst
: Great. And if I could just add a follow-up. What's an example of sort of one or two things that you would like him to tackle off of the
- at the beginning?
Question: Pat Walravens - Citizens JMP Securities, LLC - Analyst
: Yeah Sorry. I think that was on my end. What's an example of something that you'd like him to tackle in the beginning of his time
with Teradata?
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