United States securities and exchange commission logo
September 21, 2022
Claire Bramley
Chief Financial Officer
Teradata Corporation
17095 Via Del Campo
San Diego, CA 92127
Re: Teradata
Corporation
Form 10-K for
Fiscal Year Ended December 31, 2021
Filed February 25,
2022
Form 10-Q for the
Quarterly Period Ended June 30, 2022
Filed August 5,
2022
File No. 001-33458
Dear Ms. Bramley:
We have limited our review of your filings to the financial
statements and related
disclosures and have the following comments. In some of our comments, we
may ask you to
provide us with information so we may better understand your disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Form 10-K for Fiscal Year Ended December 31, 2021
Management's Discussion and Analysis of Financial Condition and Results
of Operations
Overview, page 27
1. We note your disclosure
regarding Cloud Net Expansion Rate as one of the financial and
performance metrics you
utilize and that net expansion rates were in excess of 130%.
Please tell us, and in
future filings disclose, the specific net expansion rate percentage for
each period presented.
In addition, please tell us how you monitor retention and
expansion of other
recurring revenues, such as subscription arrangements
and maintenance and
software upgrade rights, considering the relative significance of the
related revenues and
Annual Recurring Revenue (ARR). Refer to Item 303(a) of
Regulation S-K and SEC
Release No. 33-10751.
Claire Bramley
FirstName LastNameClaire Bramley
Teradata Corporation
Comapany 21,
September NameTeradata
2022 Corporation
September
Page 2 21, 2022 Page 2
FirstName LastName
Consolidated Financial Statements
Consolidated Statements of Income (Loss), page 43
2. It appears based on your disclosure on page 49 that on-premises
subscription revenue that
is not cancellable is recognized upfront at a point in time and that
such revenue is included
within the recurring subscription line item. Please explain your basis
for characterizing
on-premise subscription licenses recognized at a point in time as
recurring and quantify
the amount of such revenues for each period presented.
Note 1 Description of Business, Basis of Presentation and Significant
Accounting Policies
Revenue Recognition, page 48
3. We note your disclosure on page 30 that on-premise customer
transactions involving
substantive long-term commitments are recognized on a recurring annual
basis rather than
a recurring quarterly basis resulting in a $30 million net positive
impact in 2021 compared
to 2020. Please tell us the following related to such transactions:
Describe the nature of the arrangements and terms of the long-term
commitments,
including any cancellation provisions.
Describe how the arrangements you recognize on an upfront annual
basis differ from
those that are recognized on a quarterly or monthly basis.
Explain why recognizing on an annual basis rather than quarterly
basis resulted in a
net positive impact on revenues for 2021.
Quantify the total amount of revenues from arrangements recognized
on an annual
basis for each period presented.
Form 10-Q for the Quarterly Period Ended June 30, 2022
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Overview, page 19
4. Please explain to us why you no longer disclose subscription ARR and
maintenance and
software upgrade rights ARR in your 2022 Forms 10-Q. In this regard,
we note that these
two ARR measures comprised over 85% of total ARR at December 31, 2021.
Please
quantify for us the amount of subscription ARR and maintenance and
software upgrade
rights ARR at March 31, 2022 and June 30, 2022.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
Claire Bramley
Teradata Corporation
September 21, 2022
Page 3
You may contact Joyce Sweeney, Senior Staff Accountant at 202-551-3449
or Christine
Dietz, Senior Staff Accountant at 202-551-3408 with any questions.
FirstName LastNameClaire Bramley Sincerely,
Comapany NameTeradata Corporation
Division of
Corporation Finance
September 21, 2022 Page 3 Office of Technology
FirstName LastName