TERADATA CORP DE

Previous wording

As more fully discussed in later sections of this MD&A, the following were significant financial items for the first quarter of 2024:

Current wording

As more fully discussed in later sections of this MD&A, the following were what we view as the more significant financial items for the second quarter of 2024:

Previous wording

•At the end of the first quarter of 2024, ARR was$1.480 billion compared to$1.506 billion in thefirst quarter of 2023, decreasing 2% as compared to the first quarter of 2023, including a 1% negative impact from foreign currency translation.

Current wording

•At the end of the second quarter of 2024, ARR was $1.465 billion compared to$1.523 billion in thesecond quarter of 2023, decreasing 4% as compared to the second quarter of 2023, including a 1% negative impact from foreign currency translation.

Previous wording

•At the end of the first quarter of 2024, Public Cloud ARR was$525 million compared to $388 million in thefirst quarter of 2023, increasing 35% as compared to thefirst quarter of 2023, including a 1% negativei mpact from foreign currency fluctuations.

Current wording

•At the end of the second quarter of 2024, Public Cloud ARR was $542 million compared to $414 million in thesecond quarter of 2023, increasing 31% as compared to thesecond quarter of 2023, including a 1% negativei mpact from foreign currency fluctuations.

Previous wording

•Total revenue was$465 million for the first quarter of 2024, a 2% decrease compared to the first quarter of 2023, with flat recurring revenue results. Perpetual software licenses, hardware and other revenue decreased 38%, and consulting services revenue decreased 7%. Foreign currency fluctuations had a 1% adverse impact on total revenue for the quarter compared to the prior year.

Current wording

•Total revenue was $436 million for the second quarter of 2024, a 6% decrease compared to the second quarter of 2023, with recurring revenue down 1%. Perpetual software licenses, hardware and other revenue decreased 62%, and consulting services revenue decreased 19%. Foreign currency fluctuations had a 3% adversei mpact on total revenue for the quarter compared to the prior year.

Previous wording

•Operating expenses for the first quarter of 2024 increased 6% compared to the first quarter of 2023, primarily due to higher stock compensation and reorganization expenses in thefirst quarter of 2024.

Current wording

•Operating expenses for the second quarter of 2024 decreased 18% compared to the second quarter of 2023, primarily due to lower expenses and stock-based compensation expense in thesecond quarter of 2024.

Previous wording

•Operating income was$48 million in the first quarter of 2024, compared to $79 million in the first quarter of 2023.

Current wording

•Operating income was $66 million in the second quarter of 2024, compared to $33 million in the second quarter of 2023.

Previous wording

•Net income in the first quarter of 2024 was$20 million, compared to $40 million in the first quarter of 2023.

Current wording

•Net income in the second quarter of 2024 was $37 million, compared to $17 million in the second quarter of 2023.

Previous wording

•Cloud Net Expansion Rate for the first quarter of 2024 was 123%, compared to 119% for thefirst quarter of 2023.

Current wording

•Cloud Net Expansion Rate for the second quarter of 2024 was 123%, compared to 121% for thesecond quarter of 2023.

Previous wording

Total revenue decreased $11 million, or 2%, in the first quarter of 2024, including a 1% negative impact from foreign currency fluctuations. Recurring revenue was flat as compared to the first quarter of 2023 and included a 1% negative impact from foreign currency fluctuations. The recurring revenue growth rate for the first quarter of 2024 also included a negative 3% impact from lower annual upfront software subscription revenue associated with on-premises subscription software as compared to the prior-year period as we continue our strategy of migrating on-premises customers to the cloud and specific on-premises erosions. Revenues from perpetual software licenses, hardware and other decreased 38%, or$5 millionin the first quarter of 2024, primarily due to the timing of deals and a low overall volume from this revenue category, as aligned with our strategic shift towards recurring revenue. Consulting services revenue decreased 7% in the first quarter of 2024, including a 5% negative impact from foreign currency fluctuations. In addition, due to its association to movements in new and existing customer workloads, the consulting services revenue was also negatively impacted by the decrease in Total ARR in the period, as well as the wind-down of direct operations in China.

Current wording

Total revenue decreased $26 million, or 6%, in the second quarter of 2024, including a 3% negative impact from foreign currency fluctuations. Recurring revenue was down 1% as compared to thesecond quarter of 2023 and included a 3% negative impact from foreign currency fluctuations. Recurring revenue for thesecond quarter of 2024 included strong growth from Public Cloud revenue and a slight positive impact from annual upfront software subscription revenue associated with on-premises subscription software, partially offset by anticipated on-premises erosions and 3% of negative impact from foreign currency fluctuations. Revenues from perpetual software licenses, hardware and other decreased 62%, or $8 million in the second quarter of 2024, primarily due to the timing of deals and a low overall volume from this revenue category, as aligned with our strategic shift towards recurring revenue. Consulting services revenue decreased 19% in the second quarter of 2024, including a 4% negative impact from foreign currency fluctuations.

Previous wording

At the end of the first quarter of 2024, Total ARRdecreased 2% as compared to the first quarter of 2023, including a 1% negative impact from foreign currency fluctuations. At the end of the first quarter of 2024, Public Cloud ARRincreased 35% as compared to thefirst quarter of 2023, including a 1% negative impact from foreign currency fluctuations. Public Cloud ARR grew in all three geographic regions year-over-year. Public Cloud ARR growthin thefirst quarter of 2024 was driven by greater market awareness and customer demand of Teradata VantageCloud, our public cloud offering. The decreases in subscription ARR and maintenance and software upgrade rights ARR were partially driven by customer migrations to Cloud ARR, and partially caused by specific on-premises erosions.

Current wording

At the end of the second quarter of 2024, Total ARRdecreased 4% as compared to the second quarter of 2023, including a 1% negative impact from foreign currency fluctuations. At the end of the second quarter of 2024, Public Cloud ARR increased 31% as compared to thesecond quarter of 2023, including a 1% negative impact from foreign currency fluctuations. Public Cloud ARR growth in thesecond quarter of 2024 was driven by greater market awareness and customer demand of Teradata VantageCloud, our Public Cloud offering. The decreases in subscription ARR and maintenance and software upgrade rights ARR were driven by customer migrations to Public Cloud ARR, on-premises erosions, elongated deal closing cycles and lower on-premises expansion activity.

Previous wording

In the first quarter of 2024, we experienced the following continuing trends as compared to the first quarter of 2023:

Current wording

In the second quarter of 2024, we experienced the following trends as compared to thesecond quarter of 2023:

Previous wording

•Customers expanding into additional cloud capabilities when they migrate to VantageCloud as compared to the capabilities they had in an on-premises environment.

Current wording

•Customers expanding into additional cloud capabilities as they see value when they migrate to VantageCloud as compared to the capabilities they had in an on-premises environment.

Previous wording

•Elongated deal closing cycles that have resulted in anticipated deals moving to future quarters.

Current wording

•Elongated deal closing cycles that have resulted in anticipated deal closings moving to future quarters.

Previous wording

As a portion of the Company’s operations and revenue occur outside the United States, and in currencies other than the U.S. dollar, the Company is exposed to fluctuations in foreign currency exchange rates. Based on currency rates as of April 30, 2024, Teradata is now estimating a 2.0%-to-2.5% negative impact from currency translation on our 2024 full-year total reported revenues.

Current wording

As a portion of the Company’s operations and revenue occur outside the United States, and in currencies other than the U.S. dollar, the Company is exposed to fluctuations in foreign currency exchange rates. Based on currency rates as of June 30, 2024, Teradata is now estimating a 1.75%-to-2.25% negative impact from currency translation on our 2024 full-year total reported revenues.

Previous wording

We expect to see expansion as the primary contributor for Total ARR growth in 2024 and expansion and migration as the primary contributors for Public Cloud ARR growth in 2024.

Current wording

We expect to see elongated deal closing cycles to continue and are now expecting on-premises expansion activity to be pushed out to future quarters, each negatively impacting Total ARR growth in 2024. We expect expansion and migration activity as the primary contributors for Public Cloud ARR growth in 2024.

Previous wording

The decreasein recurring revenue gross profit as a percentage of revenue was primarily due to a higher mix of cloud revenues versus on-premises revenue as compared to the prior-year period, offset in part by continued expansion in our cloud margin rate. Recurring revenue gross margin was also negatively impacted by decreased annual upfront software subscription revenue associated with on-premises subscription software during the period and specific on-premises erosions.

Current wording

The decrease in recurring revenue gross profit as a percentage of revenue was primarily due to a higher mix of Public Cloud revenues versus on-premises revenue as compared to the prior-year period, offset in part by continued improvement in our Public Cloud margin rate.

Previous wording

Thedecrease in perpetual software licenses, hardware and other gross profit as a percentage of revenue was primarily driven by deal mix and the timing of revenue.

Current wording

The decrease in perpetual software licenses, hardware and other gross profit as a percentage of revenue was primarily driven by deal mix and the timing of revenue.

Previous wording

Consulting services gross profit as a percentage of revenue decreased somewhat as compared to the prior year primarily due to the decrease in revenue as compared to the prior-year period.

Current wording

Consulting services gross profit as a percentage of revenue decreased as compared to the prior year primarily due to the decrease in revenue as compared to the prior-year period.

Previous wording

Selling, general and administrative ("SG&A") expense increased year over year due to higher stock compensation and reorganization costs partially off-set by continued cost discipline focused on cost reductions across the Company. Research and development ("R&D") expense increased year over year primarily due to increased spending on cloud development, including AI/ML capabilities.

Current wording

Selling, general and administrative ("SG&A") expense decreased year over year due to continued cost discipline focused on cost reductions across the Company, as well as lower variable incentive compensation and stock-based compensation expense. Research and development ("R&D") expense decreased year over year also due to continued cost discipline efforts.

Previous wording

Other expense, net in the first quarter of 2024 and 2023 is comprised primarily of interest expense on long-term debt and finance leases, losses resulting from foreign currency transactions, as well as benefit costs on our pension and postemployment plans, partially offset by interest income earned on our cash and cash equivalents. Other expense islowerin 2024 primarily due todecreased foreign currency losses of $9 million as compared to the prior period.

Current wording

Other expense, net in the second quarter of 2024 and 2023 is comprised primarily of interest expense on long-term debt and finance leases, losses resulting from foreign currency transactions, as well as benefit costs on our pension and postemployment plans, partially offset by interest income earned on our cash and cash equivalents. Other expense is lower in 2024 primarily due to decreased foreign currency losses of $5 million as compared to the prior period. Interest income is lower primarily due to a lower overall cash balance.

Previous wording

As disclosed in Note 5 of Notes to Condensed Consolidated Financial Statements (Unaudited), during Februaryof 2024, we entered into a Blue Chip Swap transaction in order to remit cash from our Argentine operations that resulted in a pre-tax loss on investment of$2 million during the first quarter of 2024 that is reported in "Other" expense in the first quarter of 2024.

Current wording

As disclosed in Note 5 of Notes to Condensed Consolidated Financial Statements (Unaudited), during the second quarter of 2024, we entered into a Blue Chip Swap transaction in order to remit cash from our Argentine operations that resulted in a pre-tax loss on investment of $1 million, that is reported in "Other" expense.

Previous wording

We estimate that the full-year effective tax rate for 2024 will be approximately 26%, which takes into consideration, among other things, the forecasted earnings mix by jurisdiction, the estimated impact to GILTI tax (including the requirement to capitalize R&D for tax purposes), and the estimated discrete items to be recognized in 2024. The forecasted tax rate is based on the foreign profits being taxed at an overall effective tax rate of approximately 22%, as compared to the U.S. federal statutory tax rate of 21%.

Current wording

We estimate that the full-year effective tax rate for 2024 will be approximately 33%, which takes into consideration, among other things, the forecasted earnings mix by jurisdiction, the estimated impact to GILTI tax (including the requirement to capitalize R&D for tax purposes), and the estimated discrete items to be recognized in 2024. The forecasted tax rate is based on the foreign profits being taxed at an overall effective tax rate of approximately 23%, as compared to the U.S. federal statutory tax rate of 21%.

Previous wording

Teradata manages its business under three geographic regions, which are also our operating segments: (1) Americas region (North America and Latin America); (2) EMEA region (Europe, Middle East, and Africa) and (3) APJ region (Asia Pacific and Japan). For purposes of discussing results by segment, management excludes the impact of certain items, consistent with the manner by which management evaluates the performance of each segment. This format is useful to investors because it allows analysis and comparability of operating trends. It also includes the same information that is used by our management to make decisions regarding the segments and to assess financial performance. The chief operating decision maker, who is our President and Chief Executive Officer, evaluates the performance of the segments based on revenue and multiple profit measures, including segment gross profit. For management reporting purposes, assets are not allocated to the segments. Our segment results are reconciled to total company results reported under GAAP in Note 12 of Notes to Condensed Consolidated Financial Statements (Unaudited).

Current wording

Teradata manages its business under three geographic regions, which are also our operating segments: (1) Americas region (North America and Latin America); (2) EMEA region (Europe, Middle East, and Africa) and (3) APJ region (Asia Pacific and Japan). For purposes of discussing results by segment, management excludes the impact of certain items, consistent with the manner by which management evaluates the performance of each segment. This format is useful to investors because it allows analysis and comparability of operating trends. It also includes the same information that is used by our management to make decisions regarding the segments and to assess financial performance. The chief operating decision maker ("CODM"), who is our President and Chief Executive Officer, evaluates the performance of the segments based on revenue and multiple profit measures, including segment gross profit. For management reporting purposes, assets are not allocated to the segments. Our segment results are reconciled to total company results reported under GAAP in Note 12 of Notes to Condensed Consolidated Financial Statements (Unaudited).

Previous wording

Americas revenue decreased 5% as compared to the prior year, including a 2% adverse impact from foreign currency fluctuations. The decreasein revenues was due to a decrease in recurring revenueof 5%, and aconsulting revenue decrease of 10% ($3 million), as compared to the prior year. Segment gross profit as a percentage of revenues decreased due to a higher proportion of public cloud revenues as compared to the prior-year period.

Current wording

Americas revenue decreased 7% as compared to the prior year, including a 3% adverse impact from foreign currency fluctuations. The decrease in revenues was due to a decrease in recurring revenue of 3%, and a consulting revenue decrease of 26% ($9 million), as compared to the prior year. Segment gross profit as a percentage of revenues increased with the benefit of improved Public Cloud margins as compared to the prior-year period and a lower mix of consulting services revenue.

Previous wording

EMEA revenue increased 7%, including a 1% favorable impact from foreign currency fluctuations. The overall increase in EMEA revenue included an increaseof 14% in recurring revenue, partially off-set by a decrease of 71% ($5 million) in perpetual software licenses, hardware and other revenue. Consulting revenue was relatively flat year over year. Segment gross profit as a percentage of revenues was flat compared to the prior-year period.

Current wording

EMEA revenue decreased 2%, including a 4% adverse impact from foreign currency fluctuations. Total EMEA revenue included an increase of 4% in recurring revenue, off-set by a decrease of 80% ($4 million) in perpetual software licenses, hardware and other revenue. Consulting revenue decreased by 8% ($2 million) year over year. Segment gross profit as a percentage of revenues was down slightly compared to the prior-year period as the mix impact of a greater proportion of Public Cloud revenues were partially offset by improved Public Cloud margin rates as compared to the prior-year period.

Previous wording

For the three months ended March 31, 2023, the Company recorded $2 million of net discrete tax benefits, a majority of which related to the excess tax benefit derived from stock-based compensation vesting.

Current wording

For the six months ended June 30, 2023, the Company recorded $2 millionof net discrete tax benefits, a majority of which related to the excess tax benefit derived from stock-based compensation vesting.

Previous wording

Cash provided by operating activities was$27 million, which decreased by $82 million in the three months ended March 31, 2024 compared to the three months ended March 31, 2023. Thedecreasein cash provided by operating activities was primarily due to approximately $20 million lower net income period over period, approximately $30 million from working capital dynamics, with the remaining change largely due to lower billings. Teradata used approximately$13 million of cash in the first three months of 2024 for reorganizing and transforming its operations and go-to-market functions to align to its strategy, as compared to $15 million in the first three months of 2023.

Current wording

Cash provided by operating activities was $70 million, which decreased by $88 million in the six months ended June 30, 2024 compared to the six months ended June 30, 2023. The decrease in cash provided by operating activities was primarily due to working capital dynamics including the impact of lower billings. Teradata used approximately$18 million of cash in the first six months of 2024 for reorganizing and transforming its operations and go-to-market functions to align to its strategy, as compared to $23 million in the first six months of 2023. Teradata expects that approximately $30 to $35 million in additional cash will be used in the last six months of 2024 in connection with the implementation of the Restructuring discussed in Note 13 of Notes to Condensed Consolidated Financial Statements (Unaudited).

Previous wording

Financing activities and certain other investing activities are not included in our calculation of free cash flow. As disclosed in Note 5 of Notes to Condensed Consolidated Financial Statements (Unaudited), during February of 2024, we entered into a Blue Chip Swap transaction in order to remit cash from our Argentine operations that resulted in a pre-tax loss on investment of$2 million during the first quarter of 2024 that is reported as an investing activity for cash flow purposes. There were no other material inve sting activities for the three months ended March 31, 2024 and 2023.

Current wording

Financing activities and certain other investing activities are not included in our calculation of free cash flow. As disclosed in Note 5 of Notes to Condensed Consolidated Financial Statements (Unaudited), during the six months ended June 30, 2024, we entered into Blue Chip Swap transactions in order to remit cash from our Argentine operations that resulted in a pre-tax loss on investment of $3 million that is reported as an investing activity for cash flow purposes. There were no other material inve sting activities for the six months ended June 30, 2024 and 2023.

Previous wording

Teradata’s financing activities for the three months ended March 31, 2024 and 2023 primarily consisted of cash outflows for share repurchases and payments on our finance leases. At March 31, 2024, we hadno outstanding borrowings on our $400 million Revolving Facility (as defined below).

Current wording

Teradata’s financing activities for the six months ended June 30, 2024 and 2023 primarily consisted of cash outflows for share repurchases and payments on our finance leases. At June 30, 2024, we hadno outstanding borrowings on our $400 million Revolving Facility (as defined below).

Previous wording

•Our open market share repurchase program provides for the repurchase of Teradata stock periodically on an ongoing basis in open market transactions, through 10b5-1 programs, through accelerated share repurchase programs, in privately negotiated transactions, or through the use of derivative instruments, in accordance with applicable securities rules regarding issuer repurchases. The open market share repurchase program will expire on December 31, 2025. On November 1, 2021, our Board of Directors authorized an additional$1 billion for share repurchases under the open market share repurchase program. There is a total authority of $427 million remai ning under the open market share repurchase program as of March 31, 2024.

Current wording

•Our open market share repurchase program provides for the repurchase of Teradata stock periodically on an ongoing basis in open market transactions, through 10b5-1 programs, through accelerated share repurchase programs, in privately negotiated transactions, or through the use of derivative instruments, in accordance with applicable securities rules regarding issuer repurchases. The open market share repurchase program will expire on December 31, 2025. On November 1, 2021, our Board of Directors authorized an additional $1 billion for share repurchases under the open market share repurchase program. There is a total authority of $392 million remai ning under the open market share repurchase program as of June 30, 2024.

Previous wording

In the aggregate under the dilution offset share repurchase program and the open market share repurchase program, we repurchased approximately 3.2 million shares of common stock at an average price per share of$40.57 in the three months ended March 31, 2024.

Current wording

In the aggregate under the dilution offset share repurchase program and the open market share repurchase program, we repurchased approximately 4.4 million shares of common stock at an average price per share of $39.24 in the six months ended June 30, 2024.

Previous wording

Other financing activities, including net share settlement for the payroll tax liability of section 16 officers (as discussed in Item 2. Unregistered Sales of Equity Securities and Use of Proceeds), offset by proceeds from the ESPP and the exercise of stock options, net of tax was a net outflow of $6 million for the three months ended March 31, 2024 and a net outflow of $7 million (including fees from the credit facility agreement) for the three months ended March 31, 2023. The ESPP proceeds are included in other financing activities, net in the Condensed Consolidated Statements of Cash Flows (Unaudited).

Current wording

Other financing activities, including net share settlement for the payroll tax liability of section 16 officers (as discussed in Item 2. Unregistered Sales of Equity Securities and Use of Proceeds), offset by proceeds from the ESPP and the exercise of stock options, net of tax was a net outflow of $6 million for the six months ended June 30, 2024 and a net outflow of $1 million (including fees from the credit facility agreement) for the six months ended June 30, 2023. The ESPP proceeds are included in other financing activities, net in the Condensed Consolidated Statements of Cash Flows (Unaudited).

Previous wording

Our total cash and cash equivalents held outside the United States in various foreign subsidiaries was$306 million as of March 31, 2024 and $428 million as of December 31, 2023. The remaining balance held in the United States ("U.S.") was $31 million as of March 31, 2024 and $58 million as of December 31, 2023. The Company expects that a majority of its foreign earnings will be repatriated to the U.S. Effective January 1, 2018, the U.S. moved to a territorial system of international taxation, and as such will generally not subject future foreign earnings to U.S. taxation upon repatriation in future years.

Current wording

Our total cash and cash equivalents held outside the United States in various foreign subsidiaries was$281 million as of June 30, 2024 and $428 million as of December 31, 2023. The remaining balance held in the United States ("U.S.") was $20 million as of June 30, 2024 and $58 million as of December 31, 2023. The Company expects that a majority of its foreign earnings will be repatriated to the U.S. Effective January 1, 2018, the U.S. moved to a territorial system of international taxation, and as such will generally not subject future foreign earnings to U.S. taxation upon repatriation in future years.

Previous wording

Management believes current cash, cash generated from operations and the$400 million available under the Credit Facility will be sufficient to satisfy future working capital, research and development activities, capital expenditures, pension contributions, and other financing requirements for at least the next twelve months. The Company principally holds its cash and cash equivalents in bank deposits and highly-rated money market funds.

Current wording

Management believes current cash, cash generated from operations and the $400 million available under the Credit Facility will be sufficient to satisfy future working capital, research and development activities, capital expenditures, pension contributions, and other financing requirements for at least the next twelve months. The Company principally holds its cash and cash equivalents in bank deposits and highly-rated money market funds.

Previous wording

Long-term Debt. On June 28, 2022, we entered into a Credit Agreement that provides for (i) a five-year unsecured term loan in an aggregate principal amount of $500 million (the "Term Loan"), and (ii) a five-year unsecured revolving credit facility in an aggregate principal amount of up to $400 million, including a $50 million sublimit for the issuance of standby letters of credit and a $50 million sublimit for swingline loans (the "Revolving Facility" and, collectively with the Term Loan, the "Credit Facility"). The Credit Facility replaces our prior revolving credit agreement in the maximum principal of $400 million and our prior term loan agreement in the principal amount of $500 million, both of which were entered into in 2018 (the "Prior Agreements"). In connection with the execution of the Credit Facility, the $400 million term loan outstanding under the Prior Agreements was repaid in full. Our long-term debt is discussed in Note 10 of Notes to Condensed Consolidated Financial Statements (Unaudited). In addition, as disclosed in Note 7 of Notes to Condensed Consolidated Financial Statements (Unaudited), Teradata entered into an interest rate swap to hedge approximately 90% of the floating interest rate of the total $500 million Term Loan and a cross currency swap to hedge a portion of Euro currency exposure of its net investment in certain foreign subsidiaries.

Current wording

Long-term Debt. On June 28, 2022, we entered into a Credit Agreement that provides for (i) a five-year unsecured term loan in an aggregate principal amount of $500 million (the "Term Loan"), and (ii) a five-year unsecured revolving credit facility in an aggregate principal amount of up to $400 million, including a $50 million sublimit for the issuance of standby letters of credit and a $50 million sublimit for swingline loans (the "Revolving Facility" and, collectively with the Term Loan, the "Credit Facility"). The Credit Facility replaces our prior revolving credit agreement in the maximum principal of $400 million and our prior term loan agreement in the principal amount of $500 million, both of which were entered into in 2018 (the "Prior Agreements"). In connection with the execution of the Credit Facility, the $400 million term loan outstanding under the Prior Agreements was repaid in full. Our long-term debt is discussed in Note 10 of Notes to Condensed Consolidated Financial Statements (Unaudited). In addition, as disclosed in Note 7 of Notes to Condensed Consolidated Financial Statements (Unaudited), Teradata entered into an interest rate swap to hedge approximately 90% of the floating interest rate of the outstanding principal of the $500 million Term Loan and a cross currency swap to hedge a portion of Euro currency exposure of its net investment in certain foreign subsidiaries.

Previous wording

In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require significant management judgment in its application. There are also areas in which management’s judgment in selecting among available alternatives would not produce a materially different result. The significant accounting policies and estimates that we believe are the most critical to aid in fully understanding and evaluating our reported financial results are discussed in the 2023 Annual Report. Teradata’s senior management has reviewed these critical accounting policies and related disclosures and determined that there were no significant changes in our critical accounting policies in the three months ended March 31, 2024.

Current wording

In many cases, the accounting treatment of a particular transaction is specifically dictated by GAAP and does not require significant management judgment in its application. There are also areas in which management’s judgment in selecting among available alternatives would not produce a materially different result. The significant accounting policies and estimates that we believe are the most critical to aid in fully understanding and evaluating our reported financial results are discussed in the 2023 Annual Report. Teradata’s senior management has reviewed these critical accounting policies and related disclosures and determined that there were no significant changes in our critical accounting policies in the six months ended June 30, 2024.