Teradata (TDC) opened 2026 with Q1 revenue of US$444 million and basic EPS of US$3.60, against a backdrop of trailing 12 month revenue of US$1.69 billion and EPS of US$4.48, where earnings over that period are reported to have grown very strongly year over year. Over recent quarters, revenue has moved from US$409 million in Q4 2024 to US$418 million in Q1 2025 and US$421 million in Q4 2025, while quarterly EPS has ranged between roughly US$0.09 and US$0.46 before this latest jump. This sets up a quarter in which profitability metrics take center stage for investors watching how margins are being managed.

See our full analysis for Teradata.

With the headline numbers on the table, the next step is to set these results against the widely shared narratives about Teradata, highlighting where the story around growth, risk, and profitability is reinforced and where it is challenged.

Margins Stand Out With 24.9% Net Profit

• Over the last 12 months, Teradata reported a net profit margin of 24.9%, compared with 8.1% a year earlier, alongside trailing revenue of US$1.689b and net income of US$421 million.
• What bullish investors highlight is that this margin profile sits alongside strong trailing earnings growth of 205.1% year over year and a five year average earnings growth rate of 22.5%, yet
  • trailing revenue growth in the dataset is modest at 0.7% per year, so most of the earnings improvement is coming from profitability rather than rapid top line expansion
  • analysts in the same dataset still project earnings to decline by 40.1% per year over the next three years, which directly contrasts with the recent margin strength.

Stronger profitability on trailing numbers and a sharp gap between those margins and future earnings forecasts is exactly what bullish investors focus on when they argue the recent improvement is more durable than the projections suggest. It can be useful to see how that argument is built out in more detail in the dedicated bull case for Teradata 🐂 Teradata Bull Case

EPS Jump to US$3.60 Versus Single Digit Millions Prior

• Q1 2026 basic EPS came in at US$3.60 on net income of US$335 million, compared with quarterly net income figures between US$9 million and US$44 million and EPS between roughly US$0.09 and US$0.46 across the four quarters of 2025.
• Bears argue that such a sharp move in EPS is hard to extrapolate because their narrative assumes earnings will trend toward US$87.3 million in a future year rather than holding near US$421 million of trailing net income,
  • the risk section in the dataset points to a forecast earnings decline of 40.1% per year over the next three years, which lines up with that cautious view
  • recent share price volatility and insider selling over the last three months are also flagged as minor risks, which bears treat as signs that the market is hesitant to treat the most recent EPS print as a steady baseline.

The size of the EPS jump, set against forecasts calling for earnings declines and recent insider selling, is exactly the type of tension cautious investors focus on, and the full bear case for Teradata walks through that argument in more detail 🐻 Teradata Bear Case

P/E Of 6.8x Versus Software Peers At 27x

• The trailing P/E in the dataset is 6.8x at a share price of US$30.28, compared with a reported US software industry average P/E of 30.4x and a peer average of 27x, while the DCF fair value in the same materials is US$43.60.
• Consensus style narratives point out that this discount sits alongside both strong trailing earnings growth and modest revenue movement, which creates a mixed picture where
  • the apparent value gap to the DCF fair value of US$43.60 and to the quoted analyst target of US$33.44 exists despite trailing earnings growth of 205.1% and a net profit margin of 24.9%
  • yet flat revenue expectations and the forecast 40.1% annual decline in earnings in the dataset help explain why the market may be comfortable valuing Teradata at a P/E that is well below the sector averages.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Teradata on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

With such a split view between bulls and bears, the key question is how you see the balance of risks and rewards today. Take a moment to review the underlying figures, pressure test both narratives, then form your own stance with the help of 3 key rewards and 3 important warning signs

Explore Alternatives

Teradata's story mixes strong recent margins with modest 0.7% revenue growth and a forecast 40.1% annual earnings decline. This combination raises questions about durability.

If this mix of rich current profitability and cautious forecasts leaves you uneasy, compare it with companies screened as 74 resilient stocks with low risk scores to see options with steadier profiles.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.