Teradata: Hadoop, big data technologies 'small factor' in our slowdown

Teradata: Hadoop, big data technologies 'small factor' in our slowdown

Summary: CEO Mike Koehler said that the company is continuing to invest in big data analytics and integrated marketing tools, but projected flat revenue for 2013 relative to 2012


Teradata on Thursday moved to shoot down the theory that Hadoop and open source big data technologies are putting the kibosh on data warehouse rollouts.

The data warehouse software and hardware provider reported third quarter earnings of $98 million, or 59 cents a share, on revenue of $666 million, up 3 percent from a year ago. The company had issued a warning that its sales and earnings would fall short of expectations.

teradata 3q financials


CEO Mike Koehler said that the company is continuing to invest in big data analytics and integrated marketing tools, but projected flat revenue for 2013 relative to 2012.

Also: Teradata touts Netflix, P&G customer wins | Teradata announces cloud platform, competitive appliance economics

Following Teradata's warning, analysts surmised that the company was starting to see a hit from Hadoop, NoSQL and a bevy of other open source technologies that are being used instead of data warehouse implementations. Koehler disputed that take.

On a conference call, he said:

The major contributor to our reduced revenue guidance for 2013 was the number of data warehouse opportunities that have moved out into 2014 with a large amount of that happening in the US where the pent-up demand in our user base that we expected to see in the second half has not materialized yet. And to a lesser degree, due to reductions in revenue forecasts in the second half for the emerging markets as well as for consulting services. Our win rates remain strong and consistent with previous years. We are aware of the speculation that new and lower cost technology offerings are impacting Teradata's revenue growth. We believe it is a factor, but a small factor. When costs becomes a top priority in corporations, many of our customers invest more time and resources to optimize their current analytic environments and also evaluate potentially lower cost alternatives.

Koehler followed up with the following points:

  • Hadoop is being used by Teradata customers, but the workloads are different. "Hadoop does not address the mission critical complex business analytic work loads which Teradata provides to our customers and excels at. Based on the work we are doing with many of our largest customers, we believe that the likely impact of Hadoop on Teradata is minimal," said Koehler.
  • Four percent to 8 percent of Teradata workloads could move to Hadoop in the future.
  • Analytics will remain a top priority for enterprises and if anything Hadoop may be complementary.
  • Teradata can grow at a double digit clip in the futures.

Analysts on the call sounded a wee bit skeptical about Teradata's points, but time will tell where the company ultimately fits into the fabric that will meld data warehouses and big data.

Topics: Enterprise Software, Big Data, Hardware

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