Teradata Corp. (NYSE:TDC) reported revenue of $552 million for the quarter ended September 30, 2016, versus $606 million in the third quarter of 2015. Revenue in the third quarter of 2015 included $38 million of revenue from the Marketing Applications business that Teradata sold on July1, 2016. Excluding the Marketing Applications business, Teradata’s revenue decreased 3 percent from the prior year period. There was no currency impact on the overall third quarter revenue comparison.
Gross margin was 53.3 percent, as reported under U.S. Generally Accepted Accounting Principles (GAAP), versus 50.7 percent reported in the third quarter of 2015. On a non-GAAP basis, excluding stock-based compensation expense, special items and the Marketing Applications business as described in footnote #1, gross margin was 54.0 percent, versus 53.0 percent in the third quarter of 2015. The increase in gross margin for the quarter resulted primarily from favorable product and deal mix.
Teradata reported GAAP net income of $49 million in the third quarter, or $0.37 per diluted share, which compared to $78 million, or $0.55 per share, in the third quarter of 2015. Stock-based compensation expense, special items and the Marketing Applications business reduced Teradata’s third quarter net income by $42 million, or $0.32 per diluted share. Excluding stock-based compensation expense, special items and the Marketing Applications business, non-GAAP net income in the third quarter of 2016 was $91 million, or $0.69 per diluted share. Non-GAAP net income was $85 million or $0.60 per diluted share in the third quarter of 2015.
“In the third quarter, the Teradata team delivered revenue in line with our guidance and better than expected earnings per share while reshaping our business to deliver greater value to our customers and shareholders,” said Victor Lund, president and CEO, Teradata Corporation. “We advanced our business analytic solutions, ecosystem architecture consulting and our hybrid cloud offerings with industry-first initiatives like Teradata Everywhere and Borderless Analytics, which exemplify the new Teradata. We are accelerating execution of our strategy to better serve our customers and create new opportunities for our company.”