TDC · Teradata Corporation

Teradata's first quarter 2026 results were dominated by the financial impact of the SAP litigation settlement, which provided a pre-tax net benefit of $359 million and a GAAP EPS benefit of $2.90. This resulted in GAAP net income of $335 million and GAAP diluted EPS of $3.47, a significant increase from the prior year. Excluding the settlement, operational performance remained robust with Non-GAAP diluted EPS increasing 33% year-over-year to $0.88, driven by strong margin expansion; Non-GAAP operating margin improved to 27.3% from 21.8%. Total ARR grew 3% year-over-year to $1.492 billion, with the strategic Public Cloud ARR component accelerating to 13% growth, reaching $686 million. Total revenue increased 6% as reported to $444 million. The company introduced "Adjusted Free Cash Flow" to normalize for the settlement impact, reporting $31 million for the quarter compared to $7 million in the prior year. Management raised full-year 2026 GAAP EPS guidance to $4.22-$4.32 to reflect the settlement, while reaffirming the Non-GAAP EPS outlook of $2.55-$2.65. Cash flow from operations guidance was also raised to $642-$662 million, inclusive of the after-tax settlement benefit.