TERADATA CORP /DE/

Compensation Discussion and Analysis

Section 3: CORE COMPENSATION PROGRAM

Our executive compensation program is designed to incentivize our executive officers to pursue and execute on our priorities and promote profitable growth. The core elements of our executive officers’ compensation consist of base salary, an annual cash incentive, and a long-term incentive, which the Committee believes such compensation elements are reasonable and appropriate for the Company at this time. For 2025, our annual cash incentive and 50% of our long-term incentive is tied to performance and closely linked to our Total ARR and profitable growth strategies and continued value creation for our stockholders.

Executive Compensation Process

After the completion of the fiscal year, the CEO conducts annual performance evaluations for the prior year for each executive officer. After consulting with the Chief Administrative Officer, who has oversight for the Company's People and Law teams, and the Compensation Consultant, the CEO provides the Committee with the performance assessments and recommendations with respect to the amount and form of compensation for such executives for the current fiscal year at the Committee's first meeting of the fiscal year. With regard to our CEO, the independent members of the Board conducts the CEO annual performance evaluation at the first Board meeting of the fiscal year. The Compensation Consultant meets with the independent members of the Board in executive session at this meeting to review compensation recommendations for the CEO for the current fiscal year. Neither the CEO nor the Chief Administrative Officer provide input or recommendations with respect to his own compensation.

At its meetings at the beginning of each fiscal year (in January and/or February), the Committee reviews and approves compensation for each of our executive officers for the current fiscal year (or the independent members of the Board with regard to our CEO's compensation), which generally includes:

•changes, if any, to base salary;

•for the annual cash incentive awards, setting (i) the target opportunity expressed as a percentage of base salary and (ii) performance measures, weightings, goals and performance adjustment events; and

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Compensation Discussion and Analysis

•for the long-term incentive awards, (i) setting the total long-term incentive opportunity amount for each executive officer, (ii) approving the allocation of the long-term incentive awards for service-based restricted share unit awards; (iii) approving the allocation to the three-year performance restricted stock unit awards, including the performance measures, weightings, goals and adjustment events, and (iv) at the Committee's first meeting to occur after the Company's year-end earnings are released, approves the grant of equity awards for each executive officer consistent with the long-term incentive opportunity amount previously approved for that person.

In connection with the Committee's review and approval of executive officer compensation (or the independent members of our Board for CEO compensation), the Committee evaluates information regarding:

•competitive market compensation data prepared by the Compensation Consultant based on the Company's peer group, including for base salary, total cash compensation, and total direct compensation;

•scope, complexity, experience, and tenure of the executive officer’s position, individual contributions and performance, as well as internal pay equity;

•prior and expected financial performance of the Company; and

•the CEO recommendation for the form and amount of compensation for executive officers, other than the CEO.

Throughout the fiscal year, the Committee receives updates on the anticipated performance of the annual cash incentive award and the outstanding long-term incentive awards. In addition, the Committee receives frequent updates on compensation trends from the Compensation Consultant and the compensation methods used by the Company's compensation peer group. At the end of the fiscal year, typically during its last meeting of the fiscal year, the Committee reviews proposed performance measures for the following year's annual incentive plan and long-term incentive plan.

At the Committee's first regular meeting of the fiscal year, management presents a summary of, and the Committee certifies, actual performance as compared to the pre-established performance goals in the annual cash incentive plan and the outstanding long-term incentive plans. The Committee (or the independent members of the Board for CEO compensation) also approves the payouts of the awards under these plans, each subject to the release of the Company's year-end earnings, if such event had not yet occurred.

The Committee also addresses executive officer compensation in connection with the transition of executive officer roles throughout the year, as needed. In these circumstances, the Committee receives a recommendation from the CEO as to the transition and a market survey from the Compensation Consultant as to compensation data for the relevant executive officer position. In addition, the Committee considers other factors such as the particular skills and experience provided by the prospective executive, needs of the Company, and scope of the executive role. 2025 was a year of significant transition for the Company, including the hiring of a new Chief Financial Officer and a new Chief Product Officer. In addition, the Company restructured its People and Law teams under a Chief Administrative Officer.

Additional details of the executive compensation process by the Committee and Board, as applicable, are disclosed, as relevant, in the respective compensation element sections that follow.

We do not have any formal policies for allocating compensation among base salary, annual cash incentive awards, and long-term incentive equity grants. Instead, the Committee exercises judgment to establish a total compensation program for each executive officer that is comprised of a combination of short- and long-term incentive compensation and cash and non-cash compensation, that the Committee believes is appropriate to achieve the goals of our executive compensation program and our profitable growth strategy. In addition, the Company does not generally grant stock options or stock appreciation rights and did not grant any of these instruments during fiscal 2025. The Committee grants other equity-based awards to our executive officers and other key employees on both an annual and as-needed basis, which is typically in connection with promotions. Wedo not time the disclosure of material non-public information for the purpose of affecting the value of executive compensation, and it is the Committee’s practice to generally avoid granting equity awards during periods in which there is undisclosed material non-public information about the Company.

Summary of 2025 Compensation Decisions

Base Salary

We provide a base salary to retain and attract key executive talent and to align our compensation with market practices. Base salaries are reviewed and established by the Committee (or the independent members of the Board for CEO base salary) on a competitive basis each year commensurate with executives with similar experience levels and capabilities in the marketplace. In particular, the Committee or the Board, as relevant, takes into consideration the following factors in

Compensation Discussion and Analysis

setting or reviewing base salaries for our executive officers: current base salary; positioning relative to competitive market compensation data; scope and complexity of the position; specific needs of the Company; experience; tenure; historical and current levels of function, division and individual performance; future potential; recommendations from the CEO for executive officers other than the CEO; and internal pay comparisons.

The below chart reflects base salary changes for our named executive officers during 2025:

(2)Mr. McMillan received an increase in base salary in March 2025 to align to the market. The amount reflected is the annualized salary after that date.

(3)Mr. Smotherman received a temporary increase in base salary to align his salary with serving as the Chief Financial Officer on an interim basis. The amount in the table above is blended between both roles.

(4)Mr. Petley's base salary did not increase from 2024 to 2025, however, the total amount reflected above shows a percentage change as a result of the impact of GBP to USD currency conversion.

Annual Cash Incentive Awards

Our named executive officers participated in our 2025 annual cash incentive program under the 2025 Management Plan.

At the end of the fiscal year, during its last meeting of the fiscal year, the Committee reviews proposed performance measures for the following year's annual incentive plan. Then, at the beginning of each fiscal year, typically during its meetings in January and/or February, the Committee approves a target award expressed as a percentage of base salary for each executive officer (other than the CEO, as that amount is approved by the independent members of the Board). In addition to approving compensation for the year, the Committee reviews and approves the specific performance measures, weightings, goals and performance to assess operation execution for the year, and adjustment events, if any. For each performance measure, a threshold, target and maximum level of performance is defined, which have corresponding payout percentages. The target level set for each performance measure is aligned with our annual financial plan. Following the end of the fiscal year, at the Committee's first meeting of the fiscal year, management presents a summary of, and the Committee certifies, actual performance as compared to the pre-established goals together with a corresponding payout percentage, which is expressed as a percent of target performance.

When determining the target award for each executive officer, the Committee (or the independent members of the Board for the CEO annual cash incentive) reviews competitive market compensation data for target total cash compensation (sum of base salary and target annual cash incentive) for the position in which such executive officer serves. In addition to considering the market data, the Committee also considers scope, complexity, experience, and tenure of the executive officer’s position, individual contributions and performance, CEO recommendation for executives, other than the CEO, as well as internal pay equity. At the end of the performance period, our CEO examines overall company performance as well as the individual contributions for each role. Actual awards can range from 0% (if threshold levels of performance are not met) to 200% of the target award (if stretch levels of performance are met for all of the performance measures, and subject to an increase for the individual modifier described below). Based on company performance and the contribution of each leader, the resulting competitiveness of total cash compensation will vary on a role specific basis. As a result, and without considering any potential use of the individual modifier described below, payouts of the annual cash incentive compensation to named executive officers cannot exceed 200% of their target opportunity to manage risk overall and the cost of the plan.

The below table reflects the 2025 annual incentive target opportunity for each named executive officer:

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Compensation Discussion and Analysis

(2)Mr. Smotherman's target opportunities under the 2025 Management Plan and the 2025 Annual Incentive Plan (as defined below) reflected in the table above is an average based on the time he spent in his respective roles during 2025. For the period of time he served as Interim Chief Financial Officer, his target opportunity was 100% of base salary.

In designing the 2025 Management Plan, our Compensation Consultant performed a comparative review of our annual incentive compensation program. As part of that review, the Compensation Consultant advised the Committee that Teradata’s annual incentive compensation practices were aligned with common market practices within the approved peer group, particularly with regard to the types and number of performance measures used, the payout levels as a percent of the target level of achievement set for each of the threshold and maximum levels of achievement, and the payout percentage for each of the threshold, target and maximum levels of achievement. In this regard, Messrs. McMillan and Petley did not receive an increase in their respective target opportunity in 2025. For the other named executives in the above table who were new in role for 2025, their target opportunities were aligned with market practices as noted above.

Total payouts under the 2025 Management Plan are based primarily on our achievement of three key financial measures: Total ARR Growth %, Public Cloud ARR Growth %, and Non-GAAP Operating Margin.

Compensation Discussion and Analysis

(1)Non-GAAP Operating Margin is a non-GAAP financial measure. Please refer to Appendix B of this proxy statement for definitions and reconciliations to the GAAP financial measures.

Total ARR Growth continues to be an important metric for us as we continue to support a hybrid model for our customers that allows them to use our platform across a multi-cloud environment, in hybrid environments, and on-premises to migrate strategy to meet customers on their specific business journey. The Public Cloud ARR Growth metric is designed to focus on our ARR growth in the cloud during 2025, including by migrations of workloads from existing customers from on-premises to the cloud, expansions of existing workloads in the cloud, and the growth of new customers in the cloud. The Non-GAAP Operating Margin helps us focus on profitable growth. As we have done in the past, the 2025 Management Plan includes Total ARR Growth (on a percentage basis), Public Cloud ARR Growth (on a percentage basis), and Non-GAAP Operating Margin (on a dollar attainment basis) to focus our executives' attention on attaining financial performance for each of these strategically important measures. For the 2025 Management Plan, we increased the weighting of the Total ARR Growth performance measure and decreased the weighting of the Public Cloud ARR performance measure to align to the Company's broader platform strategy and to address dynamic and rapidly changing customer preferences and requirements. We also required that each of Total ARR Growth and Public Cloud ARR Growth perform at or above the actual levels we achieved in 2024 before any payment would be earned for those portions of the 2025 Management Plan.

The following chart sets forth the Total ARR Growth %, Public Cloud ARR Growth %, and Non-GAAP Operating Margin targets under the 2025 Management Plan, our performance for such targets, and the achievement payout level by target and in total. The overall financial achievement resulted in a 100% payout, which was more than the 80% payout achieved in 2024, reflecting achievement of the Company's focus on returning to Total ARR growth in 2025 by aligning with our customer purpose and to meet them on their ecosystem journey. The 2025 targets of Total ARR Growth % and Public Cloud ARR Growth % are new metrics for the 2025 Management Plan in that they measure the percentage growth for each category instead growth based on a dollar value in prior years. Non-GAAP Operating Margin is a continuing metric.

(1)No payout can be earned for Total ARR Growth or Public Cloud ARR Growth unless the Company achieved the threshold level of Non-GAAP Operating Margin. In addition, in order to fund each of Total ARR Growth and Public Cloud ARR Growth over target at a faster rate up to the maximum payout level, Non-GAAP Operating Margin must meet the target achievement. If the Non-GAAP Operating Margin target is not met, then Total ARR Growth and Public Cloud ARR Growth over target is calculated at a linear rate until the maximum payout is achieved.

(2)Non-GAAP Operating Margin is a non-GAAP financial measure. Please refer to Appendix B of this proxy statement for definitions and reconciliations to the GAAP financial measures.

(3)When establishing the performance objectives under the 2025 Management Plan, the Committee approved specific and typical adjustments, consistent with past practice, to actual performance for each performance measure, such that actual results would be increased or decreased, as applicable, for foreign exchange rate fluctuations, any significant acquisition or divestiture, and/or changes in applicable federal accounting standards.

(4)In 2024, the 2024 Non-GAAP Operating Margin actual amount of $356 million was adjusted by $20 million to provide for the typical foreign currency pre-approved adjustment event included as part of the 2024 Management Plan, which resulted in the amount used for purposes of determining the payout under the 2024 Management Plan for Non-GAAP Operating Margin of $376 million. The 2025 target of $322 million for Non-GAAP Operating Margin was set below the 2024 actual result (without regard to the foreign currency adjustment) of $356 million for Non-GAAP Operating Margin, to ensure the target amount in the 2025 Management Plan aligned with the Revised Plan (as defined in "2024 Business Challenges - Reminder of What We Disclosed Last Year" section later in this proxy statement).

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Compensation Discussion and Analysis

Payouts of Annual Cash Incentive Compensation

2025 Management Plan

Based on Company performance relative to the financial measures described above, the overall payout achieved was equal to 100% of the applicable named executive officer target annual incentive opportunity. All named executive officers, other than Ms. Bramley, were eligible to receive a payout under the 2025 Management Plan.

In addition, our 2025 Management Plan design provides the Committee an individual performance modifier that can adjust the company performance factor positively or negatively up to 25%, to recognize individual differences in contributions across the year. The plan design provides this feature to align our pay for performance culture and reward extraordinary contributions that may be made by individuals during the year. In evaluating performance and whether to use this permitted adjustment, the Committee considers contributions that are above and beyond what could have been planned or anticipated when the financial plan was established, in addition to where our named executive officers may have fallen short in their contributions during the year. The Committee did not approve any individual specific adjustments for 2025. As a result, each eligible named executive officer received a payout of 100% of his target annual incentive opportunity.

The 2025 Management Plan payment amounts are set forth in the Non-Equity Incentive Plan Compensation column of the Summary Compensation Table of this proxy statement. For more information on the 2025 Management Plan for our named executive officers, please refer to the “Grants of Plan-Based Awards” section of this proxy statement.

2025 Annual Incentive Plan

While Mr. Smotherman served as Interim Chief Financial Officer, he was eligible to participate in the 2025 Management Plan as noted above, which occurred from March 24, 2025 through May 11, 2025. During 2025 when Mr. Smotherman was not serving as Interim Chief Financial Officer, he participated in the 2025 Annual Incentive Plan, which is the plan applicable for non-officer employees. The 2025 Annual Incentive Plan had the same performance measures and goals as the 2025 Management Plan.

Long-Term Incentives (Equity Awards)

The total direct compensation levels for our named executive officers are heavily weighted to long-term incentive opportunities, which vest over a period of three years. This structure is intended to align executives’ interests with those of our stockholders, enhance our retention incentives, and focus our executives on delivering sustainable performance over the longer-term. The design of this program reflects the core performance metrics and incentive structure the Committee believes is necessary to drive our long-term success. The following chart includes a high-level summary of the elements of the performance-based and service-based RSU equity vehicles and performance criteria, as applicable, for our long-term incentive program since 2024.

Compensation Discussion and Analysis

Long-Term Equity Program Evolution

2025 – 2027 Performance-Based and Service-Based RSU Grants

With regard to the executive compensation program that was granted during 2025, our Compensation Consultant performed a benchmark review of our long-term incentive compensation program. As part of that review, the Compensation Consultant advised the Committee that Teradata’s long-term incentive compensation program proposed for the 2025 – 2027 performance period was aligned with the peer companies with regard to the types and number of performance measures used, the allocation between the performance and service-based components, the payout levels as a percent of the target level of achievement set for each of the threshold and maximum levels of achievement, the payout percentage for each of the threshold, target and maximum levels of achievement, and performance period. In determining the size of the long-term incentive grants, the Committee considered market data, the scope and complexity of the executive’s position, experience, tenure, internal pay comparisons, function, division, CEO recommendations for executive officers, other than the CEO, and individual performance and historical targeted grant levels. In 2025, the Committee made long-term incentive grants that consisted of a grantof 2025 – 2027 LTIP and 3-year service-based RSUs (“Service RSUs”) to our named executive officers. The target opportunity for the aggregate of the 2025 – 2027 LTIP, Service RSUs, and New Hire/Promotion grants for each named executive officer was as follows:

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Compensation Discussion and Analysis

The long-term incentive opportunity for Mr. McMillan remained consistent with the 2024 level as the Board viewed this level of compensation as appropriate for the scope of his role and the performance of the Company. For each of Messrs. Ederer, Arora, and Rogers, we made new hire offers that were designed to replace unvested value they had at their respective prior employers and to ensure internal equity and alignment with the executive team as a whole. In addition, they each received a typical annual grant of long-term equity awards consistent with what was provided to other executive officers and the total long-term incentive opportunity value granted to them for these annual long-term equity grants were consistent with competitive trends and market-based data reviewed with the Compensation Consultant for comparable roles and levels of experience. In connection with Mr. Smotherman's interim promotion in March 2025, the Committee approved an additional award of service-based RSUs ("Interim Promotion Grant"), which was consistent with his expanded role and additional responsibilities, retention considerations in light of the planned search for a permanent Chief Financial Officer, and to reward him for his promotion, on an interim basis, to being a member of the Company's executive leadership team. The long-term incentive opportunity for Mr. Petley was increased by $1,500,000 from 2024 to recognize the increasingly complex and enterprise-wide impact of his role, including the importance of his roles for facilitating the Company's transformation and returning the Company to Total ARR growth (which as noted above, we accomplished in 2025). Overall, the long-term incentive opportunities for the named executive officers align with the competitive trends as reviewed by the Committee based on the Compensation Consultant's independent analysis as part of the Committee's overview of competitive trends for talent.

The 2025 – 2027 LTIP will be earned based on the extent to which Teradata achieves three financial goals during the 3-year performance period ending December 31, 2027, as noted in the table at the beginning of this long-term incentive compensation section. The Service RSUs vest in equal annual installments over three years and are designed to provide a meaningful retention incentive for our executives in line with competitive market practices.

Compensation Discussion and Analysis

The Committee established threshold, target and maximum goals for each performance measure for the 2025 – 2027 LTIP. The specific performance goals for the three-year award period, including those established on an annual basis, are maintained by us as proprietary and confidential. The Committee believes that disclosure of these specific performance goals and business strategy would represent competitive harm to us as such corporate goals and results are not publicly disclosed and are competitively sensitive. The Committee believes the attainment of the target performance levels, while uncertain, could be reasonably achieved with strong execution by the Teradata team of the long-term financial plan. Threshold goals represent the minimum level of performance necessary for there to be a payout for that performance measure, and the Committee believes the threshold goals are rigorous, but likely to be achieved. Maximum goals represent the performances at which payouts are 200% of the target award and reinforces stretch achievements. Even if actual results exceed the maximum goals, the payouts are capped at 200% of the target award to ensure that the adjustments to the performance goals in the 2025 – 2027 LTIP would not result in a substantial benefit to the Company's executive officers and to mitigate any incentive to encourage excessive risk taking across Teradata. Maximum goals represent levels of performance at which the Committee determined a payout of 200% of target would be appropriate. The Committee believes that the maximum goals established are more aggressive goals. Consistent with our past practice, we expect to provide disclosure of the actual goals and performance attained for the 2025 – 2027 LTIP in the proxy statement for our 2028 Annual Meeting.

In addition to approving performance measures, goals and weightings, the Committee also established specific and typical corporate adjustment events, which are permitted under the 2023 SIP, and that are consistent with past practice for determining payouts under the 2025 – 2027 LTIP. The adjustment events include foreign exchange rate fluctuations, any significant acquisition or divestiture, and/or changes in applicable federal accounting standards.

2024 Business Challenges– Reminder of What We Disclosed Last Year

To demonstrate our commitment to transparency in our executive compensation process, in last year's proxy statement (the "2025 Proxy Statement") we proactively disclosed changes to the performance metrics in our 2023 – 2025 LTIP and 2024 – 2026 LTIP. No further changes were made to these awards from what was disclosed in our 2025 Proxy Statement. We are including this section in this year's proxy statement to provide a reminder, on a summary basis, of what we said in the 2025 Proxy Statement as the payouts under the 2023 - 2025 LTIP are reflected this year in the section that follows. We believe that making the adjustments we disclosed in the 2025 Proxy Statement achieved our objectives of facilitating the execution of a refocused long-term strategy, growth, stability, and retention. In addition,

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Compensation Discussion and Analysis

during our subsequent stockholder engagement efforts during 2025, we received feedback from our stockholders in support and understanding of the compensation actions that we took and disclosed in the 2025 Proxy Statement. While we are providing a summary of the items that we disclosed in the 2025 Proxy Statement below, we refer you to the section titled "2024 Business Challenges and Compensation Plan Design Changes for 2025" in the 2025 Proxy Statement for a more detailed description.

As we disclosed in the 2025 Proxy Statement, 2024 was a challenging year for Teradata, primarily due to elongated deal closing cycles and a shift in customer buying patterns, in particular as a result of the rapid proliferation of AI and many companies reevaluating their data and analytics platform needs. As a result, we refocused our long-term strategy to address the dynamic environment and changing customer preferences that we faced (the "2024 Challenges"). To align management to execution of the enhanced long-term strategy, the Board determined that it was necessary to reset the Company's long-term financial plan (the "Revised Plan"), which resulted in the performance goals set as part of the 2023 – 2025 LTIP and 2024 – 2026 LTIP no longer being aligned with the Revised Plan. To address the 2024 Challenges and Revised Plan, the Committee engaged in discussions, including with the Compensation Consultant, to consider the options available to it for the outstanding long-term equity awards (the specific options considered were detailed in the 2025 Proxy Statement), which included changes to our 2023 – 2025 LTIP and 2024 – 2026 LTIP in order to:

•re-align performance goals for the Total ARR, Public Cloud ARR, and Free Cash Flow performance measures in the 2023 – 2025 LTIP and 2024 – 2026 LTIP to the Revised Plan approved by the Board to ensure executives are incentivized to drive performance in accordance with the Revised Plan,

•enhance our ability to retain our high performing executives and senior leadership that are critical to the future growth of Teradata in a highly competitive talent market, and

•reduce the maximum payout opportunity from 200% to 150% to mitigate the ability of executives to receive a substantial benefit from the adjustments.

Ultimately, the Committee determined that in order to align to our pay for performance philosophy and to provide proper incentive to execute Teradata's long-term strategy reflected by the Revised Plan, the best course was to adjust the performance goals in the 2023 – 2025 LTIP and the 2024 – 2026 LTIP so that the target level of such plans aligned with the Revised Plan. The Committee believed that by making these adjustments, as opposed to taking other compensation actions or taking no action all, it was taking the most prudent path to align incentive compensation with the Company's evolving long-term strategy and to support the achievement of the Company's continued growth, innovation, and transformation, while also enhancing the Company's ability to retain its key high-performing senior leaders at a critical time for the Company, and selecting the option that was the least costly and dilutive to stockholders.

Payout of Performance-Based RSUs for the 2023 – 2025 Performance Period (“2023 – 2025 LTIP”)

As part of our 2023 – 2025 LTIP, we granted performance-based RSUs to our named executive officers.

•40% of the award was based on 2023 - 2025 Free Cash Flow;

•30% of the award was subject to achievement of 2025 Total ARR $; and

•30% of the award was subject to achievement of 2025 Total Public Cloud ARR $.

As noted above and disclosed in detail in the 2025 Proxy Statement, the Committee approved adjustments to the 2025 Total ARR, 2025 Total Public Cloud ARR, and Free Cash Flow performance goals that are included in the 2023 – 2025 LTIP.

The performance goals and targets for the 2023 – 2025 LTIP (as adjusted), along with actual results for each year, are as follows:

Compensation Discussion and Analysis

(1)Free Cash Flow is a non-GAAP financial measure. Please refer to Appendix B of this proxy statement for definitions and reconciliations to the GAAP financial measures.

Based on the actual results for the 2023 – 2025 performance period relative to the goals outlined above, the weighted average payout percentage for each of the named executive officers was 74%. The Committee examined the results overall and recognized that the Company had made solid execution against the re-focused strategy, as it faced a dynamic environment and changing customer platform preferences, but that the goals overall were not fully achieved.

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