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Segment and Other Supplemental Information
 3 Months Ended
Mar. 31, 2025
Segment Reporting [Abstract]  
Segment and Other Supplemental Information Segment and Other Supplemental Information
On August 5, 2024, Teradata announced that it realigned its sales function and initiated global restructuring to optimize operations. Due to these organizational changes Teradata now manages its business under two segments, which are also the Company’s operating segments: (1) Product Sales and (2) Consulting Services. The Company’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 line item, each as disclosed in the Company’s financial statements and in the tables in this Form 10-Q. 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, who is the Company's President and Chief Executive Officer, evaluates the performance of the segments based on revenue and multiple profit measures, including segment gross profit. For management reporting purposes, assets are not allocated to the segments. Prior period segment information has been reclassified to conform to the current period presentation.
The following table presents segment revenue and segment gross profit for the Company:
 Three Months Ended
March 31,
In millions20252024
Segment revenue
Product Sales$368 $396 
Consulting Services50 69 
Total revenue418 465 
Segment cost of revenue
Product Sales (1)
115 118
Consulting Services (2)
51 58
Total segment cost of revenue166 176 
Segment gross profit
Product Sales253 278 
Consulting Services(1)11 
Total segment gross profit252 289 
Stock-based compensation expense4 4 
Acquisition, integration, reorganization, and transformation-related costs— 1 
Total gross profit248 284 
Selling, general and administrative expenses116 161 
Research and development expenses66 75 
Income from operations$66 $48 
(1) Cost of Product Sales, for the three months ended March 31, included product costs of $64 million in 2025 and $55 million in 2024, for Public Cloud fees and direct product and third-party software costs associated with the Company's perpetual product sales. Depreciation expense for the three months ended March 31, included in Cost of Product Sales was $16 million in 2025, and $21 million in 2024. The remaining cost of Product Sales included payroll and benefits costs, and corporate allocations including back-office information technology, real estate, and other support services.   
(2) Cost of Consulting Services, for the three months ended March 31, included payroll and benefit costs of $32 million in 2025 and $37 million in 2024. The remaining cost of Consulting Services included 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.