Back to top

Image: Bigstock

Investing in Teradata (TDC)? Don't Miss Assessing Its International Revenue Trends

Read MoreHide Full Article

Have you assessed how the international operations of Teradata (TDC - Free Report) performed in the quarter ended June 2024? For this data management company, possessing an expansive global footprint, parsing the trends of international revenues could be critical to gauge its financial resilience and growth prospects.

In the current era of a tightly interconnected global economy, the proficiency of a company to penetrate international markets significantly influences its financial health and trajectory of growth. For investors, the key is to grasp how reliant a company is on overseas markets, as this provides insights into the durability of its earnings, its ability to exploit different economic cycles, and its overall growth capabilities.

Being present in international markets serves as a counterbalance to domestic economic challenges while offering chances to engage with more rapidly evolving economies. However, this kind of diversification introduces challenges like currency fluctuations, geopolitical uncertainties and varying market trends.

Upon examining TDC's recent quarterly performance, we noticed several interesting patterns in the revenue generated from its international segments, which are commonly analyzed and observed by Wall Street experts.

The company's total revenue for the quarter amounted to $436 million, showing decrease of 5.6%. We will now explore the breakdown of TDC's overseas revenue to assess the impact of its international operations.

A Look into TDC's International Revenue Streams

Asia Pacific and Japan accounted for 16.1% of the company's total revenue during the quarter, translating to $70 million. Revenues from this region represented a surprise of +7.78%, with Wall Street analysts collectively expecting $64.95 million. When compared to the preceding quarter and the same quarter in the previous year, Asia Pacific and Japan contributed $63 million (13.6%) and $76 million (16.5%) to the total revenue, respectively.

Of the total revenue, $116 million came from Europe, Middle East and Africa during the last fiscal quarter, accounting for 26.6%. This represented a surprise of -2.04% as analysts had expected the region to contribute $118.41 million to the total revenue. In comparison, the region contributed $125 million, or 26.9%, and $118 million, or 25.5%, to total revenue in the previous and year-ago quarters, respectively.

Revenue Forecasts for the International Markets

Wall Street analysts expect Teradata to report $427.46 million in total revenue for the current fiscal quarter, indicating a decline of 2.4% from the year-ago quarter. Asia Pacific and Japan and Europe, Middle East and Africa are expected to contribute 14.3% ($61.24 million) and 27.3% ($116.49 million) to the total revenue, respectively.

For the entire year, the company's total revenue is forecasted to be $1.77 billion, which is a reduction of 3.3% from the previous year. The revenue contributions from different regions are expected as follows: Asia Pacific and Japan will contribute 14.3% ($253.13 million) and Europe, Middle East and Africa 27.2% ($482.33 million) to the total revenue.

In Conclusion

The dependency of Teradata on global markets for its revenues presents a mix of potential gains and hazards. Thus, monitoring the trends in its overseas revenues can be a key indicator for predicting the firm's future performance.

With the increasing intricacies of global interdependence and geopolitical strife, Wall Street analysts meticulously observe these patterns, especially for companies with an international footprint, to tweak their forecasts of earnings. Importantly, several additional factors, such as a company's domestic market status, also impact these earnings forecasts.

Emphasizing a company's shifting earnings prospects is a key aspect of our approach at Zacks, especially since research has proven its substantial influence on a stock's price in the short run. This correlation is positively aligned, meaning that improved earnings projections tend to boost the stock's price.

With an impressive externally audited track record, our proprietary stock rating tool - the Zacks Rank - harnesses the power of earnings estimate revisions and serves as an effective indicator of a stock's near-term price performance.

Teradata, bearing a Zacks Rank #3 (Hold), is expected to mirror the broader market's movements in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Examining the Latest Trends in Teradata's Stock Value


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Teradata Corporation (TDC) - free report >>

Published in