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Employee Stock-based Compensation Plans (Tables)
 12 Months Ended
Dec. 31, 2014
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Stock-Based Compensation Expense
The Company recorded stock-based compensation expense for the years ended December 31 as follows: 
In millions
2014
 
2013
 
2012
Stock options
$
13

 
$
14

 
$
15

Restricted stock
33

 
32

 
28

Employee share repurchase program (compensatory effective 1/1/13)
4

 
3

 
—

Total stock-based compensation before income taxes
50

 
49

 
43

Tax benefit
(16
)
 
(16
)
 
(14
)
Total stock-based compensation, net of tax
$
34

 
$
33

 
$
29
Fair Value of Each Option Award on the Grant Date Using the Black-Scholes Option-Pricing Model
The fair value of each option award on the grant date was estimated using the Black-Scholes option-pricing model with the following assumptions:
 
2014
 
2013
 
2012
Dividend yield
—
%
 
—
%
 
—
%
Risk-free interest rate
1.73
%
 
1.77
%
 
0.87
%
Expected volatility
37.8
%
 
37.6
%
 
35.7
%
Expected term (years)
6.3

 
6.3

 
6.3
The Company's Stock Option Activity
The following table summarizes the Company’s stock option activity for the year ended December 31, 2014: 
Shares in thousands
Shares
Under
Option
 
Weighted-
Average
Exercise
Price per
Share
 
Weighted-
Average
Remaining
Contractual
Term (in
years)
 
Aggregate
Intrinsic
Value (in
millions)
Outstanding at January 1, 2013
7,012

 
$
33.27

 
6.3
 
$
100

Granted
921

 
$
44.43

 
 
 
 
Exercised
(561
)
 
$
19.02

 
 
 
 
Canceled
(36
)
 
$
41.83

 
 
 
 
Forfeited
(99
)
 
$
50.98

 
 
 
 
Outstanding at December 31, 2014
7,237

 
$
35.50

 
6.1
 
$
78

Fully vested and expected to vest at December 31, 2014
7,194

 
$
35.44

 
6.0
 
$
78

Exercisable at December 31, 2014
5,190

 
$
30.63

 
4.9
 
$
78
Total Intrinsic Value of Options Exercised and The Cash Received
The following table summarizes the total intrinsic value of options exercised and the cash received by the Company from option exercises under all share-based payment arrangements at December 31:
In millions
2014
 
2013
 
2012
Intrinsic value of options exercised
$
14

 
$
19

 
$
113

Cash received from option exercises
$
11

 
$
9

 
$
43

Tax benefit realized from option exercises
$
5

 
$
6

 
$
38
Restricted Stock and Restricted Stock Unit Activity
The following table reports restricted stock and restricted stock unit activity during the year ended December 31, 2014: 
Shares in thousands
Number of
Shares
 
Weighted-
Average 
Grant
Date Fair
 Value
per Share
Unvested shares at January 1, 2014
2,578

 
$
50.30

Granted
1,447

 
$
44.39

Vested
(537
)
 
$
50.91

Forfeited/canceled
(236
)
 
$
54.17

Unvested shares at December 31, 2014
3,252

 
$
47.18
Weighted-Average Fair Value and Total Fair Value of Shares Vested
The following table summarizes the weighted-average fair value of restricted stock units granted for Teradata equity awards and the total fair value of shares vested at December 31:
 
2014
 
2013
 
2012
Weighted-average fair value of restricted stock units granted
$
44.39

 
$
48.24

 
$
60.71

Total fair value of shares vested (in millions)
$
27

 
$
30

 
$
15
The Composition of Teradata Restricted Stock Grants
The following table represents the composition of Teradata restricted stock unit grants in 2014: 
Shares in thousands
Number of
Shares
 
Weighted-
Average 
Grant
Date Fair 
Value
Service-based shares
1,361

 
$
44.28

Performance-based shares
86

 
$
46.26

Total stock grants
1,447

 
$
44.39
Primary Assumptions Used in Valuation of Market Component of Awards
The primary assumptions used in the valuation of the market component of the awards were as follows: 
 
2012
Grant date fair value per share of Company common stock
$
58.63

Expected volatility
36.44
%
Risk-free interest rate
0.47
%
Dividend yield
—

Performance vesting hurdle - future fair value per share of Company common stock
$
85.00
Employee Purchases and Aggregate Cost
Employee purchases and aggregate cost were as follows at December 31:
In millions
2014
 
2013
 
2012
Employee share purchases
0.4

 
0.4

 
0.2

Aggregate cost
$
18

 
$
20

 
$
12