Teradata reported $399 million in revenue for Q3 2026.

Cover page 2 changes

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For the quarterly period ended June September 30, 2026

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At July 24, October 23, 2026 , the registrant had approximately 93.0 91.4 million shares of common stock outstanding.

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Financial statements 145 changes

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June 30, Six Months Ended June 30,

September 30, Nine Months Ended September 30,

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Subscription software licenses $ 53 $ 65 $ 152 $ 148

Services and other 310 289 611 564

Total recurring 363 354 763 712

Consulting services 39 51 82 101

Total revenue 410 408 854 826

Subscription software licenses 8 5 19 10

Services and other 112 114 224 217

Total recurring 120 119 243 227

Consulting services 41 56 86 109

Total cost of revenue 167 178 335 348

Gross profit 243 230 519 478

Total operating expenses 195 206 507 388

Income from operations 48 24 12 90

Subscription software licenses $ 55 $ 60 $ 207 $ 208

Services and other 304 306 915 870

Total recurring 359 366 1,122 1,078

Perpetual software licenses, hardware and other 8 3 9 13 3 12 16

Consulting services 37 47 119 148

Total revenue 399 416 1,253 1,242

Subscription software licenses 7 5 26 15

Services and other 113 111 337 328

Total recurring 120 116 363 343

Perpetual software licenses, hardware and other 6 3 6 4 — 10 12

Consulting services 37 47 123 156

Total cost of revenue 161 163 496 511

Gross profit 238 253 757 731

Selling, general and administrative expenses 120 135 360 251 109 122 469 373

Research and development expenses 75 71 147 137 70 222 207

Total operating expenses 184 192 691 580

Income from operations 54 61 66 151

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Interest expense ( 6 ) ( 6 ) ( 12 ) ( 13 )

Interest income 7 2 10 5

Other (expense) income ( 2 ) ( 7 ) 474 ( 11 )

Income before income taxes 47 13 484 71

Income tax expense 1 4 103 18

Net income $ 46 $ 9 $ 381 $ 53

Interest expense ( 2 ) ( 7 ) ( 14 ) ( 20 )

Interest income 3 2 13 7

Other (expense) income ( 5 ) ( 2 ) 469 ( 13 )

Total other (expense) income, net ( 1 4 ) ( 11 7 ) 472 468 ( 19 26 )

Income before income taxes 50 54 534 125

Income tax expense 12 14 115 32

Net income $ 38 $ 40 $ 419 $ 93

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Basic $ 0.49 $ 0.09 $ 4.07 $ 0.56

Diluted $ 0.48 $ 0.09 $ 3.95 $ 0.55

Basic $ 0.41 $ 0.42 $ 4.50 $ 0.98

Diluted $ 0.40 $ 0.42 $ 4.36 $ 0.96

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Basic 93.9 95.3 93.5 95.2

Diluted 96.2 96.0 96.4 97.0

Basic 92.6 94.2 93.2 94.9

Diluted 95.5 95.5 96.2 96.5

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June 30, Six Months Ended June 30,

September 30, Nine Months Ended September 30,

1 unchanged paragraph

Net income $ 46 $ 9 $ 381 $ 53

Net income $ 38 $ 40 $ 419 $ 93

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Foreign currency translation adjustments 3 18 — ( 2 ) 26 ( 2 ) 24

Unrealized (loss) gain (loss) on cross-currency net investment hedge, before tax ( 2 ) ( 13 1 — 2 3 ( 18 )

Unrealized (loss) gain (loss) on cross-currency net investment hedge, tax portion — 3 — ( 1 ) 4

Total currency translation adjustments 1 8 ( 1 2 ) 12 — 10

Derivative change, before tax — 3 ( ( 2 1 ) ( 1 ) ( 6 7 )

Derivatives, tax portion 1 — — 1 — 2

Derivative change, net of tax — 2 ) ( 2 — ( 1 ) ( 5 )

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Other comprehensive income 1 7 1 10

Comprehensive income $ 47 $ 16 $ 382 $ 63

Reclassification of loss to net income, before tax 2 2 4 4 6 6

Defined benefit plans, tax portion ( ( 1 ) ( 1 ) ( 1 2 ) ( 2 )

Defined benefit plans, net of tax 2 1 3 3 1 4 4

Other comprehensive income 2 ( 1 ) 3 9

Comprehensive income $ 40 $ 39 $ 422 $ 102

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In millions, except per share amounts June September 30,

Cash and cash equivalents $ 414 432 $ 493

Accounts receivable, net 256 202 251

Other current assets 98 84 80

Total current assets 773 731 837

Property and equipment, net 191 183 198

Right of use assets - operating lease, net 8 7 7

Capitalized contract costs, net 39 38 42

Deferred income taxes 166 164 209

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and 65 more changes in the filing

Note 3: Revenue from Contracts with Customers 34 changes

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Three Months Ended June 30, Six Months Ended June 30,

Recurring $ 182 $ 187 $ 394 $ 382

Consulting services 9 13 20 28

Total United States 191 201 415 415

Recurring $ 181 $ 167 $ 369 $ 330

Consulting services 30 38 62 73

Total International 219 207 439 411

Total Revenue $ 410 $ 408 $ 854 $ 826

Three Months Ended September 30, Nine Months Ended September 30, in millions 2026 2025 2026 2025

Recurring $ 186 $ 198 $ 580 $ 580

Perpetual software licenses and hardware — 1 1 5 6

Consulting services 10 13 30 41

Total United States 196 212 611 627

Recurring $ 173 $ 168 $ 542 $ 498

Perpetual software licenses and hardware 8 3 2 8 8 11 10

Consulting services 27 34 89 107

Total International 203 204 642 615

Total Revenue $ 399 $ 416 $ 1,253 $ 1,242

1 unchanged paragraph

Three Months Ended June 30, Six Months Ended June 30,

Rental revenue* $ 61 $ 51 $ 116 $ 100

Three Months Ended September 30, Nine Months Ended September 30, in millions 2026 2025 2026 2025

Rental revenue* $ 58 $ 51 $ 174 $ 151

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Contract assets $ 5 $ 5

in millions June September 30, 2026 December 31, 2025

Accounts receivable, net $ 256 202 $ 251

Contract assets $ 4 $ 6

Current deferred revenue $ 560 466 $ 533

Long-term deferred revenue $ 12 11 $ 11

Revenue recognized during the six nine months ended June September 30, 2026 from amounts included in deferred revenue at the beginning of the period was $ 293 373 million .

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Remaining unsatisfied obligations $ 2,026 $ 1,353 $ 673

The following table includes estimated revenue expected to be recognized in the future related to the Company's unsatisfied (or partially satisfied) obligations at June September 30, 2026 :

in millions Total at June September 30, 2026 Year 1 Year 2 and Thereafter

Remaining unsatisfied obligations $ 1,997 $ 1,305 $ 692

The amounts above represent the price of firm orders for which work has not been performed or goods have not been delivered and exclude unexercised contract options outside the stated contractual term that do not represent material rights to the customer. Although the Company believes that the contract value in the above table is firm, approximately $ 1,084 1,068 million of the amount is under contracts that are subject to customer-only general cancellation for convenience terms that the Company is contractually obligated to perform unless the customer notifies us of cancellation. The Company expects to recognize revenue of approximately $ 499 492 million in the next year from contracts that are non-cancelable. The Company believes the inclusion of this information is important to understanding the obligations that the Company is contractually required to perform and provides useful information regarding remaining obligations related to these executed contracts.

Note 4: Contract Costs 4 changes

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in millions December 31, 2025 Capitalized Amortization June September 30, 2026

Capitalized contract costs $ 42 $ 7 11 $ ( 10 15 ) $ 39 38

in millions December 31, 2024 Capitalized Amortization June September 30, 2025

Capitalized contract costs $ 46 $ 3 7 $ ( 12 18 ) $ 37 35

Note 5: Supplemental Financial Information 19 changes

In millions June 30,

Three Months Ended June 30 Six Months Ended June 30,

In millions September 30,

Deferred revenue, current $ 560 466 $ 533

Long-term deferred revenue 12 11 11

Total deferred revenue $ 572 477 $ 544

Three Months Ended September 30 Nine Months Ended September 30,

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Other 120 135 239 251

Three Months Ended June 30, Six Months Ended June 30,

Other 109 122 348 373

Selling, general and administrative expenses $ 120 109 $ 135 122 $ 360 469 $ 251 373

Three Months Ended September 30, Nine Months Ended September 30,

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Other ( 1 ) ( 3 ) ( 4 ) ( 7 )

Total Other (expense) income $ ( 2 ) $ ( 7 ) $ 474 $ ( 11 )

Foreign currency losses ( 1 ) $ — 4 — $ ( 2 ) $ ( 4 )

Other ( 5 ) ( 2 ) ( 9 ) ( 9 )

Total Other (expense) income $ ( 5 ) $ ( 2 ) $ 469 $ ( 13 )

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Other: Argentina Blue Chip Swap Transaction Transactions

The Central Bank of Argentina continues to impose foreign exchange controls that restrict access to U.S. dollars and the remittance of funds outside Argentina. These controls have led to the development of alternative foreign exchange mechanisms, including Blue Chip Swaps, through which market-based exchange rates for U.S. dollars are established that differ from official exchange rates. During the three and six months ended June September 30, 2026 and 2025, the Company incurred a immaterial pre-tax investment loss o f $ 1 million related losses relate d to Blue Chip Swap transactions. During the three and six nine months ended June September 30, 2026 and 2025 , the Company incurred an immaterial $ 1 million of pre-tax investment loss losses related to a Blue Chip Swap transaction. transactions.

Note 6: Income Taxes 11 changes

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Three Months Ended June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

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Effective tax rate 2.1 % 30.8 % 21.3 % 25.4 %

For the three months ended June 30, 2026, the Company recorded $ 12 million of net discrete tax benefit, a majority of which related to additional tax benefit resulting from available tax elections to expense certain research and development costs for purposes of computing its Net Controlled Foreign Corporation Tested Income ("NCTI").

For the three months ended June 30, 2025, the Company recorded $ 1 million of net discrete tax expense, a majority of which related to additional tax expense from stock-based compensation vesting.

Effective tax rate 24.0 % 25.9 % 21.5 % 25.6 %

For the three months ended September 30, 2026, the Company had no material discrete tax adjustments.

For the three months ended September 30, 2025, the Company had no material discrete tax adjustments.

For the six nine months ended June September 30, 2026, the Compa ny recorded $ 67 66 million of net discrete tax expense, a majority of which related to the tax expense impact resulting from the receipt of the SAP Legal Settlement Amount less $ 121 359 million of legal fees SAP Settlement Net Proceeds recognized in the first quarter of 2026. for the SAP Litigation, for a net taxable amount of $ 359 million, as well as the tax benefit related to research and development costs associated with NCTI, referenced above .

For the six nine months ended June September 30, 2025, the Company had no material recorded $ 1 million of net discrete tax adjustment, benefit, as the discrete tax benefit recognized in the first quarter of 2025 related to the reversal of uncertain tax positions due to the Company's completion of its IRS audit of its 2020 tax return, which was offset by incremental tax expense from stock-based compensation vesting.

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The Company estimates its annual effective tax rate for 2026 to be approximately approxi mately 23 %, which takes into consideration, among other things, the forecasted earnings mix by jurisdiction and the impact of discrete tax items to be recognized in 2026. Under U.S. tax law, U.S. shareholders are subject to a tax on the net controlled foreign corporations tested income ("NCTI"), (formerly global intangible low-taxed income ("GILTI") tax) earned by certain foreign subsidiaries. The Company has elected to provide for the tax expense related to NCTI in the year in which the tax is incurred, if any. For the six nine months ended June September 30, 2026, the Company has recorded $ 3 5 million of NCTI net tax expense as a discrete item related to the impacts from the SAP Legal Settlement Agreement.

Note 7: Derivative Instruments and Hedging Activities 7 changes

2 unchanged paragraphs

On June 17, 2026, the Company restructured its net investment hedge by terminating its existing cross-currency swap and simultaneously entering into two replacement cross-currency swaps (designated as net investment hedges of the Company's euro-denominated net investment in certain foreign subsidiaries) of approximately € 71 million / $ 75 million , each. One swap matures on June 29, 2029 and the second swap matures on June 30, 2031. The restructuring extended the hedge horizon without changing the Company's risk management objective. In connection with the restructuring, the Company made a cash payment of approximately $ 1 million to reduce the embedded market value of the original swap. The remaining fair value was incorporated into the pricing of the replacement swaps and is being recognized consistent with the accounting for net investment hedges.

As of June September 30, 2026, the Company maintained these two cross-currency swaps with an aggregate notional amount of € 143 million and $ 150 million from the counterparty. The Company will receive receives monthly interest payments from the counterparty based on a fixed interest rate until maturity of the agreements. Under the agreements, the Company will deliver Euro notional amounts and receive U.S. dollar notional amounts at maturity and receives fixed-rate interest payments from the counterparties over the remaining terms of the swaps.

The Company performed an effectiveness assessment upon designation of the replacement swaps and concluded they were highly effective. Effectiveness is evaluated quarterly. Changes in fair value are recorded in Accumulated other comprehensive loss and periodic settlements are recorded in inte rest expense. income. The Company will systematically amortize the initial excluded component, which was immaterial at inception, to interest expense income over the term of the hedging relationships.

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In millions June 30,

In millions September 30,

Contract notional amount of foreign exchange forward contracts $ 98 39 $ 81

Net contract notional amount of foreign exchange forward contracts $ 60 10 $ 7

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Note 8: Commitments and Contingencies 3 changes

1 unchanged paragraph

As such, the Company has generally not recorded a liability in connection with these indemnification arrangements. Historically, payments made by the Company under these types of agreements have not had a material effect on the Company's consolidated financial condition, results of operations or cash flows.

Other Contingencies. Additionally, the Company provides its customers with certain indemnification rights. In general, the Company agrees to indemnify the customer if a third party asserts patent or other infringement on the part of the customer for its use of the Company's offerings. The Company has indemnification obligations under its charter and bylaws to its officers and directors, and has entered into indemnification agreements with its officers and directors and with the officers and directors of its subsidiaries. From time to time, the Company also enters into agreements in connection with its acquisition and divestiture activities that include indemnification obligations by the Company. The fair value of these indemnification obligations is typically not readily determinable due to the conditional nature of the Company's potential obligations and the specific facts and circumstances involved with each particular agreement. As such, the Company has generally not recorded a liability in connection with these indemnification arrangements. Historically, payments made by the Company under these types of agreements have not had a material effect on the Company's consolidated financial condition, results of operations or cash flows.

Concentrations of Risk . The Company is potentially subject to concentrations of credit risk on accounts receivable and financial instruments such as hedging instruments, and cash and cash equivalents. Credit risk includes the risk of nonperformance by counterparties. The maximum potential loss may exceed the amount recognized on the balance sheet. Exposure to credit risk is managed through credit approvals, credit limits, selecting major international financial institutions (as counterparties to hedging transactions) and monitoring procedures. Teradata's business often involves large transactions with customers, and if one or more of those customers were to default in its obligations under applicable contractual arrangements, the Company could be exposed to potentially significant losses. However, management believes that the reserves for potential losses were adequate at June September 30, 2026 and December 31, 2025.

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Note 9: Fair Value Measurements 6 changes

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The Company uses foreign exchange forward contracts and cross-currency swaps to manage foreign currency exposure. During the three months ended June 30, 2026, the Company restructured its net investment hedge cross- currency swaps (aggregate notional value of € 143 million/$ 150 million) and terminated its interest rate swap in connection with the repayment of its term loan. See Note 7, Derivative Instruments and Hedging Activities, for further detail.

Derivative fair values are measured using market spot and forward exchange rates (Level 2). Unrealized gains are recorded in other assets and unrealized losses in other liabilities, classified between current and long-term by remaining duration. Fair values of foreign exchange forward contracts and realized hedge gains/losses (net of underlying exposure offsets) were not material for the th e three and six nine months ended June September 30, 2026 and 2025.

The Company's other assets and other liabilities measured at fair value on a recurring basis and subject to fair value disclosure requirements at June September 30, 2026 and December 31, 2025 were as follows:

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Money market funds at June September 30, 2026

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3 Year foreign currency swap at June September 30, 2026

5 Year foreign currency swap at June September 30, 2026

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Note 10: Debt 2 changes

3 unchanged paragraphs

As of June September 30, 2026, the Company had no borrowings outstanding under the Revolving Credit Facility, leaving $ 400 million in borrowing capacity available under the Revolving Credit Facility. The Company was in compliance with all covenants under the Credit Agreement as of June September 30, 2026.

For the three months ended June 30, 2026 and June September 30, 2025, the blended all-in interest rate associated with the Prior Term Loan was 4.10 % and 4.17 4.14 %. respectively.

1 unchanged paragraph

Note 11: Earnings per Share 12 changes

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June 30, Six Months Ended June 30,

September 30, Nine Months Ended September 30,

1 unchanged paragraph

Weighted average outstanding shares of common stock 93.9 95.3 93.5 95.2

Net income attributable to common stockholders $ 46 38 $ 9 40 $ 381 419 $ 53 93

Weighted average outstanding shares of common stock 92.6 94.2 93.2 94.9

Dilutive effect of employee stock options, restricted stock and other stock awards 2.3 0.7 2.9 1.8 1.3 3.0 1.6

Common stock and common stock equivalents 95.5 95.5 96.2 96.0 96.4 97.0 96.5

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Basic $ 0.49 $ 0.09 $ 4.07 $ 0.56

Diluted $ 0.48 $ 0.09 $ 3.95 $ 0.55

Basic $ 0.41 $ 0.42 $ 4.50 $ 0.98

Diluted $ 0.40 $ 0.42 $ 4.36 $ 0.96

Options to purchase 0.1 million shares in the three and six nine months ended June September 30, 2025, were not included in the computation of diluted earnings per share because the exercise prices of these options were greater than the average market price of the common shares for the period, and therefore would have been anti-dilutive. There were no anti‑dilutive share options for the three and six nine months ended June September 30, 2026 .

Note 12: Segment and Other Supplemental Information 28 changes

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June 30, Six Months Ended June 30,

September 30, Nine Months Ended September 30,

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Product Sales $ 371 $ 357 $ 772 $ 725

Consulting Services 39 51 82 101

Total revenue 410 408 854 826

Product Sales $ 362 $ 369 $ 1,134 $ 1,094

Consulting Services 37 47 119 148

Total revenue 399 416 1,253 1,242

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Total segment cost of revenue 162 170 323 336 157 157 480 493

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Product Sales 248 239 529 492

Consulting Services — ( 1 ) 2 ( 2 )

Total segment gross profit 248 238 531 490

Stock-based compensation expense 4 5 8 9

Total gross profit 243 230 519 478

Income from operations $ 48 $ 24 $ 12 $ 90

Product Sales 240 255 769 747

Consulting Services 2 4 4 2

Total segment gross profit 242 259 773 749

Stock-based compensation expense 5 4 13 13

Acquisition, integration, reorganization, and transformation-related costs ( 1 3 4 ) 2 3 5

Total gross profit 238 253 757 731

Selling, general and administrative expenses 120 135 360 251 109 122 469 373

Research and development expenses 75 71 147 137 70 222 207

Income from operations $ 54 $ 61 $ 66 $ 151

(1) Cost of Product Sales, for the three months ended June September 30, included product costs of $ 65 60 million in 2026 and $ 59 60 million in 2025 for Public Cloud fees and direct product and third-party software costs associated with the Company's perpetual product sales. Depreciation expense for the three months ended June September 30, included in Cost of Product Sales, was $ 18 19 million in 2026, and $ 19 18 million in 2025. The remaining cost of Product Sales included payroll and benefits costs, and corporate allocations including back-office information technology, real estate, and other support services.

Cost of Product Sales, for the six nine months ended June September 30, included product costs of $ 120 180 million in 2026 and $ 123 183 million in 2025 for Public Cloud fees and direct product and third-party software costs associated with the Company's perpetual product sales. Depreciation expense for the six nine months ended June September 30, included in Cost of Product Sales, was $ 38 57 million in 2026, and $ 35 53 million in 2025. The remaining cost of Product Sales included payroll and benefits costs, and corporate allocations including back-office information technology, real estate, and other support services.

(2) Cost of Consulting Services, for the three months ended June September 30, included payroll and benefit costs of $ 26 25 million in 2026 and $ 33 29 million in 2025. The remaining cost of Consulting Services included corporate allocations, including back-office information technology, real estate, and other support services.

Cost of Consulting Services, for the six nine months ended June September 30, included payroll and benefit costs of $ 54 79 million in 2026 and $ 65 94 million in 2025. The remaining cost of Consulting Services included corporate allocations, including back-office information technology, real estate, and other support services.

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Note 13: Reorganization and Business Transformation 3 changes

On August 5, 2024, the Company announced that it realigned its sales function and initiated global restructuring and cost actions to optimize operations, reduce non-revenue generating expenses, and drive efficiencies for long-term growth and profitability (the "Restructuring"). The actions related to the Restructuring have been were completed as of June 30, 2026.

The majority of the costs related to the Restructuring include one-time employee separation benefits, transition support, and other employee-related costs. The Company recognized costs of $ 20 million related to the Restructuring in 2025 and 2024. Cash expenditures related to these actions were $ 45 million. The Company recorded $ 41 million of cash payments from these actions in 2025 and 2024, and $ 4 million of cash payments in the six nine months ended June September 30, 2026.

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In millions Balance at December 31, 2025 Expense accruals Cash payments Balance at June September 30, 2026

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MD&A 124 changes

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• Gross margin increased to 59.3% in the second quarter of 2026 from 56.4% in the second quarter of 2025, primarily due to a greater mix of recurring revenue in the period.

Second Third Quarter Financial Overview

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 third quarter of 2026:

• At the end of the second third quarter of 2026, Total ARR was $1.509 $1.512 billion compared to $1.489 $1.490 billion at the end of the second third quarter of 2025 , increasing 1% as compared to the second third quarter of 2025, including a 1% negative impa ct from foreign currency fluctuations.

• At the end of the second third quarter of 2026, Public Cloud ARR was $686 $700 million compared to $634 $633 million at the end of the second third quarter of 2025, increasing 8% 11% as compared to the second third quarter of 2025, w ith a 1% an immaterial negative impact from foreign currency fluctuations.

• Total revenue was $410 $399 million for the second third quarter of 2026 , increasing decreasing by $2 $17 million compared to the second third quarter of 2025, with recurring revenue up 3%. down 2%. Perpetual software licenses, hardware and other revenue increased by 167% ($5 million) , was flat year over year, and consulting services revenue decreased 24% 21% . Foreign currency fluctuations did not have a material impact on o n total revenue for the quarter compared to the prior year.

• Gross margin decreased to 59.6% i n the third quarter of 2026 from 60.8% in the third quarter of 2025, primarily due to a higher mix of Public Cloud revenue, the timing of infrastructure charges, and adverse deal mix within the Perpetual software licenses, hardware and other revenue in the period.

• Operating expenses for the second third quarter of 2026 decreased 5% 4% compared to the second third quarter of 2025, largely from lower employee compensation salary and wage expense in the second third quarter of 2026, due to the impact of restructuring actions taken in the prior year, as well as incremental provisions for uncollectable accounts in the prior year that didn't recur in the current period.

• The Company saw an operating income of $48 $54 million in the second third quarter of 2026, compared to operating income of $24 $61 million in the second third quarter of 2025.

• Net income in the second third quarter of 2026 was $46 $38 million , compared to $9 $40 million in the second third quarter of 2025.

Results of Operations for the Three Months Ended June September 30, 2026

Compared to the Three Months Ended June September 30, 2025

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Recurring $ 363 88.5 % $ 354 86.8 %

Consulting services 39 9.5 % 51 12.5 %

Total revenue $ 410 100 % $ 408 100 %

Recurring $ 359 90.0 % $ 366 88.0 %

Perpetual software licenses, hardware and other 8 2.0 3 0.7 % 3 0.7 %

Consulting services 37 9.3 % 47 11.3 %

Total revenue $ 399 100 % $ 416 100 %

Total revenue increased $2 de creased $17 million, or 0%, 4% , in the second third quarter of 2026, with no material impact from foreign currency fluctuations. Recurring revenue increased 3% decreased 2% as compared c ompared to the second third quarter of 2025, including a 1% positive with no material impact from foreign currency fluctuations. The decrease in recurring revenue for the second third quarter of 2026 included growth from Public Cloud revenue, offset in part was impacted by lower annual upfront software subscription revenue, offset in part by growth from Public Cloud revenue. Revenue from perpetual software licenses, hardware and other increased $5 million year was flat yea r over year, primarily driven by consisting of perpetual hardware. Consulting services revenue decreased 24% 21% or $12 $10 million in i n the second third quarter of 2026, with a 1% 2% negative impact i mpact from foreign currency exchange rate fluctuations. The consulting services revenue revenu e decrease is primarily the result of lower order performance from the second half of 2025 and first quarter half of 2026.

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Our Total ARR is composed of three main categories: (1) Public Cloud ARR, (2) ARR related to on-premises subscription-based contracts and private cloud ("Subscription ARR"), and (3) ARR related to our legacy perpetual maintenance and software upgrade rights. At June September 30, 2026 and 2025 our Total ARR consisted of:

1 unchanged paragraph

Public Cloud $ 686 $ 634

Subscription 750 756

Total ARR $ 1,509 $ 1,489

Public Cloud $ 700 $ 633

Subscription 744 765

Maintenance and Software upgrade rights 73 99 68 92

Total ARR $ 1,512 $ 1,490

At the end of the second third quarter of 2026, Total ARR increased 1% a s compared to the second third quarter of 2025, including a 1% negative imp act impact from foreign currency fluctuations. At the end of the second third quarter of 2026, Public Cloud ARR increased 8% 11% as compared to the second third quarter of 2025, with a 1 % negative an immaterial impact from foreign currency fluctuations. Public Cloud ARR growth in t he second third quarter of 2026 was primarily driven by customer demand of our Public Cloud offering and customer migrations. The decreases in Subscriptions and Maintenance and Software upgrade rights ARR were primarily driven by customer migrations to Public Cloud ARR and on-premises erosions.

In the second third quarter of 2026, we experienced expe rienced the following trends:

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• Continued macroeconomic and geopolitical uncertainty, including evolving global trade and tariff policy and elevated interest rates, contributing to elongated customer decision cycles and staged purchasing decisions.

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As a portion of the Company's operations and revenue occur outside the United States, and in currencies other than the United States ("U.S.") dollar, the Company is exposed to fluctuations in foreign currency exchange rates. Based on currency rates as o f June September 30, 2026, Teradata is now estimating 0.0%-0.5% an approximately 0.5% positive impact from currency translation on our 2026 full-year total reported revenues.

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Recurring $ 243 66.9 % $ 235 66.4 %

Consulting services (2) (5.1) % (5) (9.8) %

Total gross profit $ 243 59.3 % $ 230 56.4 %

Recurring $ 239 66.6 % $ 250 68.3 %

Perpetual software licenses, hardware and other 2 25.0 (1) (33.3) % — — 3 100.0 %

Consulting services — — % — — %

Total gross profit $ 238 59.6 % $ 253 60.8 %

The increase in decrease i n recurring revenue gross profit as a percentage of revenue was primarily due to continued improvement in our Public Cloud margin rate, offset in part impacted by a higher mix of Public Cloud revenues versus on-premises revenue as compared to the prior-year period, the impact of upfront subscription software revenue recognized earlier in the year, as well as the timing of certain infrastructure charges recognized in the period, offset in part by continued improvement in our Public Cloud margin rate.

Perpetual software licenses, hardware and other gross profit as a percentage of revenue increased decreased as compared to the prior-year period primarily due to deal mix.

Consulting services gross profit as a percentage of revenue increased was flat as compared to the prior year primarily due to as cost reduction efforts were taken reflective of the revenue decline over the past year.

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Total operating expenses $ 195 47.6 % $ 206 50.5 %

Selling, general and administrative expenses $ 120 29.3 109 27.3 % $ 135 33.1 122 29.3 %

Research and development expenses 75 18.3 18.8 % 71 17.4 70 16.8 %

Total operating expenses $ 184 46.1 % $ 192 46.2 %

Selling, general and administrative ("SG&A") expense expens e decreased year over year due to lower employee compensation salary and wage expense, the result of continued budget discipline focused on cost reductions across the Company, including the impact of restructuring actions taken in the prior year, as well as incremental provisions for uncollectable accounts in the prior year that didn't recur in the current period. Research and development ("R&D") expense increased year over year due to investments in Public Cloud and AI-related technology opportunities offset in part by continued cost reduction initiatives.

1 unchanged paragraph

Interest income $ 7 $ 2

Interest expense (6) (6)

During the three months ended June 30, 2026, the Company recorded a gain of approximately $ 3 million related to the fair value of the Company's interest rate swap upon its termination, see Note 7, Derivative Instruments and Hedging Activities, for further details. As disclosed in Note 5 of Notes to Condensed Consolidated Financial Statements (Unaudited), during the three months ended June 30, 2025, we entered into Blue Chip Swap transactions in order to remit cash from our Argentine operations that resulted in an immaterial pre-tax loss on investment that is reported in "Other" expense. During the three months ended June 30, 2026 the Company incurred a pre-tax loss on investment of $1 million from Blue Chip Swap transactions.

Interest income $ 3 $ 2

Interest expense (2) (7)

Other expense, net $ (1) (4) $ (11) (7)

Other expense, net in the second third quarter of 2026 and 2025 is comprised primarily of interest expense on the recently paid-off long-term debt and finance leases, as well as benefit costs on our pension and postemployment plans, largely offset in part by interest income earned on our cash and cash equivalents, and gains gains/losses from foreign currency transactions.

As disclosed in Note 5 of Notes to Condensed Consolidated Financial Statements (Unaudited), during the three months ended September 30, 2026 and 2025, the Company incurred immaterial pre-tax investment losses relate d to Blue Chip Swap transactions.

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Effective tax rate 2.1 % 30.8 %

For the three months ended June 30, 2026, the Company recorded $12 million of net discrete tax benefit, a majority of which related to additional tax benefit resulting from available tax elections to expense certain research and development costs for purposes of computing its Net Controlled Foreign Corporation Tested Income ("NCTI").

For the three months ended June 30, 2025, the Company recorded $1 million of net discrete tax expense, a majority of which related to additional tax expense from vesting of stock-based compensation.

The effective tax rates for the three months ended June September 30, 2026 and 2025 were as follows:

Effective tax rate 24.0 % 25.9 %

For the three months ended September 30, 2026, the Company had no material discrete tax adjustments.

For the three months ended September 30, 2025, the Company had no material discrete tax adjustments.

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The forecasted tax rate is based on the foreign profits being taxed at an overall effective tax rate of approximately 16%, 20%, as compared to the U.S. federal statutory tax ra te of 21%.

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Results of Operations for the Six Nine Months Ended June September 30, 2026

Compared to the Six Nine Months Ended June September 30, 2025

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Recurring $ 763 89.3 % $ 712 86.2 %

Perpetual software licenses, hardware and other 9 1.1 % 13 1.6 %

Consulting services 82 9.6 % 101 12.2 %

Total revenue $ 854 100 % $ 826 100 %

Recurring $ 1,122 89.5 % $ 1,078 86.8 %

Perpetual software licenses, hardware and other 12 1.0 % 16 1.3 %

Consulting services 119 9.5 % 148 11.9 %

Total revenue $ 1,253 100 % $ 1,242 100 %

Total revenue increased $28 million, $11 m illion, or 3%, 1% , in the first six nine months of 2026, with a 1% positive impact from foreign currency fluctuations. Recurring revenue increased 7%, 4%, with a 2% 1% positive impact from foreign currency fluctuations, and benefit from higher annual upfront software revenue associated with on-premises subscription software as compared to the prior-year period. Within recurring revenue, Public Cloud revenue, which increased primarily due to expansions and migrations.

Revenues from perpetual software licenses, hardware and other decreased $4 million, or 31% o r 25% year over year in the first six nine months of 2026.

Consulting services revenue decreased 19% 20% in the t he first six nine months of 2026, with no material a 1% negative impact from foreign currency fluctuations. The consulting services revenue decrease is primarily the result of lower order performance from the second half of 2025 and the first half of 2026.

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Recurring $ 520 68.2 % $ 485 68.1 %

Perpetual software licenses, hardware and other 3 33.3 % 1 7.7 %

Consulting services (4) (4.9) % (8) (7.9) %

Total gross profit $ 519 60.8 % $ 478 57.9 %

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and 44 more changes in the filing

Controls and procedures 2 changes

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Based on their evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of June September 30, 2026, our disclosure controls and procedures were effective to provide reasonable assurance that the information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

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There have been no changes in our internal control over financial reporting that occurred during the last fiscal quarter ended June September 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Unregistered sales of stock 2 changes

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From time to time, the Company's Section 16 officers sell to the Company shares of the Company's common stock received upon vesting of restricted share units at the current market price to cover their withholding tax obligations. For the six nine months ended June September 30, 2026, the total of these purchases was 348,235 shares at an average price of $33.99 per share.

The following table provides information relating to the Company's share repurchase programs for the six nine months ended June September 30, 2026:

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Dilution 5 changes

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Second Quarter Total 1,331,914 $ 30.41 — 1,331,914 $ 730,792 $ 429,798,114

July 2026 565,476 $ 31.51 — 565,476 $ 730,792 $ 411,977,147

August 2026 695,289 $ 27.98 — 695,289 $ 730,792 $ 392,524,155

September 2026 690,236 $ 28.74 166,033 524,203 $ 308,181 $ 377,412,339

Second Third Quarter Total 1,331,914 1,951,001 $ 30.41 — 1,331,914 29.27 166,033 1,784,968 $ 730,792 308,181 $ 429,798,114 377,412,339 (1) The dilution offset share repurchase program allows the Company to repurchase Teradata common stock to the extent of cash received from the exercise of stock options and purchases under the ESPP to offset dilution from shares issued pursuant to these plans.

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Other information 9 changes

Name (Title) Action Date Trading Arrangement Total Shares to be Sold Expiration Date

Rule 10b5-1* Non-Rule 10b5-1**

Stephen McMillan ( Chief Executive Officer and director )

Adopted May 18, 2026 x Up to 80,000

Michael Hutchinson ( Chief Operating Officer )

Adopted May 7, 2026 x Up to 64,102

* Intended to satisfy the affirmative defense of Rule 10b5-1(c).

**Not intended to satisfy the affirmative defense of Rule 10b5-1.

During the three months ended June September 30, 2026, other than the director and officers shown in the table below, no other director or officer o f of Teradata Corporation adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) of Regulation S-K. Each individual noted below continues to be in compliance with the Company's applicable stock ownership requirement when factoring in the potential sales contemplated under the Rule 10b5-1 Plans disclosed in the following table.

Exhibits 9 changes

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Teradata 2023 Stock Incentive Plan (Amended and Restated as of May 14, 2026) (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K dated May 19, 2026 (SEC File No. 001-33458)).

Credit Agreement dated as of June 24, 2026 among Teradata Corporation, the lenders party thereto and Bank of America, N.A., as Administrative Agent (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K dated June 24, 2026 (SEC File No. 001-33458)).

Form of Indemnification Agreement between Teradata Corporation and each of its directors and executive officers (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed August 17, 2026 (SEC file number 001-33458)).

Teradata Employee Stock Purchase Plan (Amended and Restated as of September 1, 2026) (filed herewith). (incorporated by reference to Exhibit 10.2 to the Quarterly Report on Form 10-Q dated August 5, 2026 (SEC file number 001-33458 )) .

Certification pursuant to Rule 13a-14(a), dated August 5, November 6 , 2026.

Certification pursuant to Rule 13a-14(a), dated August 5 November 6 , 2026.

Certification pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, dated August 5 November 6 , 2026.

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* Management contracts or compensatory plans, contracts or arrangements.

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Date: August 5, November 6, 2026 By: /s/ John Ederer

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