Teradata Q2 Results and Q3 Outlook
Teradata Corp. (NYSE:TDC) reported second‑quarter 2026 results that surpassed analyst expectations. Adjusted earnings per share were $0.69, outpacing the consensus estimate of $0.55 by $0.14. Revenue reached $410 million, beating the $396.07 million forecast and remaining essentially flat versus $408 million in the same quarter a year earlier. Recurring revenue grew 3% year‑over‑year to $363 million.
Operating performance improved, with the adjusted operating margin expanding 510 basis points year‑over‑year to 21.5%. Cash flow from operations surged 147% to $106 million, and public‑cloud annual recurring revenue increased 8% year‑over‑year to $686 million.
Despite the strong quarter, the company issued a weaker outlook for the third quarter. Teradata guided adjusted EPS to a range of $0.55‑$0.59, with a midpoint of $0.57, below the analyst consensus of $0.62. It also projected third‑quarter recurring revenue to decline 2%‑4% year‑over‑year and total revenue to fall 4%‑6% year‑over‑year.
For the full fiscal year 2026, Teradata raised its adjusted EPS guidance to $2.65‑$2.73, with a midpoint of $2.69, slightly above the consensus of $2.67. The adjusted free cash flow outlook was increased to a range of $330 million‑$350 million.
CEO and President Steve McMillan said the quarter demonstrated solid performance, noting growth in total ARR, recurring revenue, and meaningful free cash flow. He highlighted the launch of the Autonomous Knowledge Platform, describing it as a powerful set of capabilities to help enterprises deploy agentic AI.
Following the release, Teradata shares dropped 17.5% in after‑hours trading on Tuesday.