Biz data wrangler's lost its head and gained another. Let's have a look at the Tera...data
Geddit? We mean the numbers. Financial results. Oh forget it
After its first 2016 quarter loss and CEO change how did business data analysis haus Teradata do in its second 2016 quarter?
Revenues of $599m were down down 3.9 per cent on the year-ago quarter’s $623m but 9.9 per cent higher than the first 2016 quarter, good news there. There was a profit of $64m, better than last quarter’s loss of $46m and much, much better than the year-ago quarter's loss of $265m, good news there as well.
Teradata says this is better than expected. Excluding the troubled Marketing Applications business, revenue was $564m, down 3.6 per cent on the year. This business was sold on July 1 to an affiliate of Marlin Equity Partners for approximately $90m, with net proceeds of about $75m, which will be used for general corporate purposes. Not bad for a Teradata boat anchor.
New CEO Vic Lund’s canned quote said: "In the second quarter, we delivered solid results, advanced our strategy and accelerated the pace of our technology innovations. … We will remain unwavering in our focus on delivering what customers want and need.”
The outlook for 2016 remains between $2.32bn and $2.39bn, with next quarter's revenues expected to be between $550m and $560m. Teradata said its transformation has “progressed from the planning stage to the execution stage of its transformation. Additionally, Teradata has moved from the cost reduction stage to active cost management as it invests for the future of the company, including its cloud-based initiatives and realignment of its go-to-market approach.”
COO and co-president Bob Fair has departed. He replaced COO Bruce Langos in January this year so his COO-ship has been cut short. He gets $1.47m in severance pay plus health coverage for 18 months and his 2016 incentive bonus pro-rated to his November 1 departure date.
In the earnings call, Lund said Teradata would look to make its software available on the Amazon and Azure public clouds. Indeed, Teradata's database with MPP offering on AWS will be ready later this quarter. Aster will soon be available on AWS and Teradata's database with MPP will become available on Azure.
Lund also said Teradata would examine ideas about co-operating with open source Big data technology such as Hadoop. The sales force will be geed up and tooled up to perform better. Consultancy offerings will be increased.
No CEO search is underway so Lund, if he is a stop-gap CEO, is in for a longer gap.
The company has to embrace cloud computing as a delivery channel and as a (subscription and rental-type) business model. It has to work with the grain of modern Big Data analytics instead of fighting it. Teradata is coming quite late to the cloud and Hadoop-era and will almost certainly see a difficult transition from its proprietary, on-premises past to a hybrid on-premises-cloud future with open source Big Data software co-operation.
Let’s hope Lund’s drive and luck are strong enough to pull Teradata through. ®