Reorganization and Business Transformation

9 Months Ended

Sep. 30, 2017

Restructuring and Related Activities [Abstract]

Reorganization and Business Transformation

In the fourth quarter of 2015, the Company announced a plan to realign Teradata’s business by reducing its cost structure and focusing on the Company’s core data and analytics business. This business transformation included exiting the marketing applications business, rationalizing costs, and modifying the Company’s go-to-market approach. The Company incurred the following costs for the nine months ended September 30:



	Nine Months Ended September 30,
In millions	2017		2016
Employee severance and other employee related cost	$	2	$	12
Asset write-downs	1		80
Professional services, legal and other transformation costs	24		27
Total reorganization and business transformation cost	$	27	$	119

For the nine months ended September 30, 2017, costs incurred above includes $3 million for an inventory charge and other associated transformation costs related to the discontinuation of Teradata's prior hardware platforms. In addition to the costs and charges incurred above, the Company made cash payments of less than $1 million for the nine months ended September 30, 2017 and $18 million for the nine months ended September 30, 2016 for employee severance related to this business transformation that did not have a material impact on its Statement of Operations due to Teradata's accounting for its postemployment benefits under Accounting Standards Codification 712, Compensation - Nonretirement Postemployment Benefits (“ASC 712”), which uses actuarial estimates and defers the immediate recognition of gains or losses.