We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Teradata (TDC) Q4 Earnings Beat Estimates, Revenues In Line
Read MoreHide Full Article
Teradata Corporation (TDC - Free Report) reported fourth-quarter 2016 results wherein adjusted earnings per share of 57 cents easily topped the Zacks Consensus Estimate of 51 cents. However, on a year-over-year basis, it declined 9.5%.
The company reported non-GAAP earnings of 67 cents in the quarter compared with 75 cents in the year-ago quarter.
Teradata Corporation Price, Consensus and EPS Surprise
Revenues of $626 million came in line with the Zacks Consensus Estimate. However, on a year-over- year basis, it plunged 13% mainly due to the company’s ongoing business transformation activity under which its large customers have begun shifting to subscription pricing offerings.
Products revenues decreased 19% year over year to $259 million. Services revenues fell 8% on a year-over-year basis to $367 million. Revenues from Americas Data and Analytics declined 10% year over year while that from International Data and Analytics dropped 5% from the prior-year quarter.
Margin
Non-GAAP gross margin contracted 130 basis points (bps) from the year-ago quarter to 51.3% mainly due to lower volume.
The company reported non-GAAP operating income of $126 million, down from $143 million reported in the prior-year quarter. Non-GAAP operating margin shrunk 90 bps to 20.1%.
Balance Sheet
Teradata exited the quarter with $974 million in cash and cash equivalents compared with $988 million at the end of the previous quarter. Teradata had long-term debt of $538 million at the end of the fourth quarter compared with $545 million at the end of third-quarter 2016.
In 2016, Teradata generated cash flow from operations of $446 million compared with $401 million in 2015. Free cash flow generated was $328 million compared with $281 million last year.
Guidance
Revenues for the first quarter of 2017 are expected to be approximately $500 million. Non-GAAP earnings per share are expected in a range of 25 cents – 30 cents.
To Conclude
Teradata is undergoing restructuring to enhance its product portfolio and streamline its operations. This is directed toward strengthening its position in the data and analytics market.
In line with its growth strategy, the company divested its Marketing Application business for $75 million last year.
However, restructuring related costs, a sluggish spending environment in the domestic market and increasing competition from peers like Oracle (ORCL - Free Report) , IBM Corporation (IBM - Free Report) Microsoft, Dell and others can weigh on its financials.
Currently, Teradata has a Zacks Rank #5 (Strong Sell).
Notably, the stock has underperformed the Zacks categorized Computer-Storage Devices industry in the last three months. The industry gained 24.6% in the said period while Teradata returned just 7.7%.
The stock witnessed upward estimate revision for the current quarter and the fiscal in the last 30 days.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest tickers for the entirety of 2017?
Who wouldn't? These 10 are painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. They are our primary picks to buy and hold. Be among the very first to see them >>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Teradata (TDC) Q4 Earnings Beat Estimates, Revenues In Line
Teradata Corporation (TDC - Free Report) reported fourth-quarter 2016 results wherein adjusted earnings per share of 57 cents easily topped the Zacks Consensus Estimate of 51 cents. However, on a year-over-year basis, it declined 9.5%.
The company reported non-GAAP earnings of 67 cents in the quarter compared with 75 cents in the year-ago quarter.
Teradata Corporation Price, Consensus and EPS Surprise
Teradata Corporation Price, Consensus and EPS Surprise | Teradata Corporation Quote
Revenue Details
Revenues of $626 million came in line with the Zacks Consensus Estimate. However, on a year-over- year basis, it plunged 13% mainly due to the company’s ongoing business transformation activity under which its large customers have begun shifting to subscription pricing offerings.
Products revenues decreased 19% year over year to $259 million. Services revenues fell 8% on a year-over-year basis to $367 million. Revenues from Americas Data and Analytics declined 10% year over year while that from International Data and Analytics dropped 5% from the prior-year quarter.
Margin
Non-GAAP gross margin contracted 130 basis points (bps) from the year-ago quarter to 51.3% mainly due to lower volume.
The company reported non-GAAP operating income of $126 million, down from $143 million reported in the prior-year quarter. Non-GAAP operating margin shrunk 90 bps to 20.1%.
Balance Sheet
Teradata exited the quarter with $974 million in cash and cash equivalents compared with $988 million at the end of the previous quarter. Teradata had long-term debt of $538 million at the end of the fourth quarter compared with $545 million at the end of third-quarter 2016.
In 2016, Teradata generated cash flow from operations of $446 million compared with $401 million in 2015. Free cash flow generated was $328 million compared with $281 million last year.
Guidance
Revenues for the first quarter of 2017 are expected to be approximately $500 million. Non-GAAP earnings per share are expected in a range of 25 cents – 30 cents.
To Conclude
Teradata is undergoing restructuring to enhance its product portfolio and streamline its operations. This is directed toward strengthening its position in the data and analytics market.
In line with its growth strategy, the company divested its Marketing Application business for $75 million last year.
However, restructuring related costs, a sluggish spending environment in the domestic market and increasing competition from peers like Oracle (ORCL - Free Report) , IBM Corporation (IBM - Free Report) Microsoft, Dell and others can weigh on its financials.
Currently, Teradata has a Zacks Rank #5 (Strong Sell).
Notably, the stock has underperformed the Zacks categorized Computer-Storage Devices industry in the last three months. The industry gained 24.6% in the said period while Teradata returned just 7.7%.
A better-ranked stock in the broader technology sector is Seagate Technology Plc (STX - Free Report) which sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The stock witnessed upward estimate revision for the current quarter and the fiscal in the last 30 days.
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest tickers for the entirety of 2017?
Who wouldn't? These 10 are painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. They are our primary picks to buy and hold. Be among the very first to see them >>