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Segment, Other Supplemental Information and Concentrations | 12 Months Ended
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Dec. 31, 2024
Segment Reporting [Abstract] |
Segment, Other Supplemental Information and Concentrations | Segment, Other Supplemental Information and Concentrations Teradata now manages its business under two segments, which are also the Company’s new operating segments: (1) Product Sales and (2) Consulting Services. Teradata’s Product Sales segment represents the results for the Recurring Revenue and Perpetual Software Licenses, Hardware and Other line items and the Consulting Services segment represents the Consulting Services. The prior year results have been updated to conform to the current year presentation. Prior to August 5, 2024, Teradata managed its business under three geographic regions, which were also the Company’s operating segments: (1) Americas region (North America and Latin America); (2) EMEA region (Europe, Middle East and Africa) and (3) APJ region (Asia Pacific and Japan). For purposes of discussing results by segment, management excludes the impact of certain items, consistent with the manner by which management evaluates the performance of each segment. This format is useful to investors because it allows analysis and comparability of operating trends. It also includes the same information that is used by Teradata management to make decisions regarding the segments and to assess financial performance. The chief operating decision maker ("CODM"), who is our President and Chief Executive Officer, evaluates the performance of each segment by comparing segment revenue and segment gross profit results to historical and previously forecasted financial information on a monthly and quarterly basis to allocate operating and capital resources. Our CODM monitors assets for the consolidated Company but does not use assets by segment when assessing performance or making operating segment resource allocations. The following table presents segment revenue, segment cost of revenue and segment gross profit for the Company for the years ended December 31:
In millions | 2024 |  | 2023 |  | 2022
Segment revenue |  |  |  |  |
Product Sales | $ | 1,502 |  |  | $ | 1,537 |  |  | $ | 1,484 |
Consulting Services | 248 |  |  | 296 |  |  | 311 |
Total revenue | 1,750 |  |  | 1,833 |  |  | 1,795 |
Segment cost of revenue |  |  |  |  |
Product Sales (1) | 453 |  |  | 446 |  |  | 428 |
Consulting Services (2) | 217 |  |  | 254 |  |  | 262 |
Total segment cost of revenue | 670 |  |  | 700 |  |  | 690 |
Segment gross profit |  |  |  |  |
Product Sales | 1,049 |  |  | 1,091 |  |  | 1,056 |
Consulting Services | 31 |  |  | 42 |  |  | 49 |
Total segment gross profit | 1,080 |  |  | 1,133 |  |  | 1,105 |
Stock-based compensation expense | 17 |  |  | 17 |  |  | 16 |
Acquisition, integration and reorganization-related costs | 5 |  |  | 1 |  |  | 8 |
Total gross profit | 1,058 |  |  | 1,115 |  |  | 1,081 |
Selling, general and administrative expenses | 565 |  |  | 635 |  |  | 650 |
Research and development expenses | 284 |  |  | 294 |  |  | 313 |
Total income from operations | $ | 209 |  |  | $ | 186 |  |  | $ | 118 |
(1) Cost of Product Sales includes product costs of $223 million in 2024, $193 million in 2023, and $148 million in 2022 for Public Cloud fees and direct product and third-party software costs associated with the Company's perpetual product sales. Depreciation expense included in Cost of Product Sales was $79 million in 2024, $88 million in 2023, and $100 million in 2022. The remaining cost of Product Sales includes payroll and benefits costs, and corporate allocations including back-office information technology, real estate, and other support services. (2) Cost of Consulting Services includes payroll and benefit costs of $137 million in 2024, $149 million in 2023, and $154 million in 2022. The remaining cost of Consulting Services includes corporate allocations, including back-office information technology, real estate, and other support services. Certain items, including stock-based compensation and reorganization-related costs, were excluded from segment gross profit to conform to the way the Company manages and reviews the results by segment. The following table presents revenues by geographic area for the years ended December 31:
In millions | 2024 |  | 2023 |  | 2022
United States | $ | 894 |  |  | $ | 973 |  |  | $ | 914 |
International | 856 |  |  | 860 |  |  | 881 |
Total revenue | $ | 1,750 |  |  | $ | 1,833 |  |  | $ | 1,795 |
The following table presents property and equipment, net by geographic area at December 31:
In millions | 2024 |  | 2023
United States | $ | 122 |  |  | $ | 170 |
International | 63 |  |  | 69 |
Property and equipment, net | $ | 185 |  |  | $ | 239 |
Concentrations. No single customer accounts for more than 10% of the Company's revenue for any period presented. No country outside the United States accounts for more than 10% of the Company's revenue or property and equipment, net, for any period presented. As of December 31, 2024, the Company is not aware of any significant concentration of business transacted with a particular customer that could, if suddenly eliminated, have a material adverse effect on the Company’s operations. The Company's hardware components are assembled primarily by Flex. In addition, the Company utilizes preferred supplier relationships to better ensure more consistent quality, cost, and delivery. There can be no assurances that a disruption in production at Flex or at a supplier would not have a material adverse effect on the Company's operations. In addition, a significant change in the forecasts to any of these preferred suppliers could result in purchase obligations or components that may be in excess of demand.

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- Definition The entire disclosure for reporting segments including data and tables. 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