Teradata at Citi’s 2026 Global TMT Conference: cloud, AI and hybrid push

Citi's 2026 Global TMT Conference provided a platform for Teradata Corporation to discuss its recent business transformation. CEO Steve McMillan highlighted that the company's cloud revenue has seen significant growth, reaching 50% of recurring revenue, up from its traditional on-premise model. This shift reflects Teradata's strategic pivot towards a cloud-enabled, AI-driven enterprise technology company, a move that began under McMillan's leadership since his arrival in June 2020.

The Teradata Autonomous Knowledge Platform, introduced in May 2026, represents a comprehensive architecture redesign centered around AI agents and human operators. This platform, termed "Teradata 3.0," builds upon the company's latest product, the Teradata Autonomous Knowledge Platform, which includes new capabilities at every layer of the stack.

Key components of the platform include Tera Harness, which enables customers to manage costs and governance through support for various language models, including ChatGPT and Claude. The company also announced the opening of the Tera Harness codebase for customization by customers, while maintaining a managed version for support.

Teradata unveiled several new products aimed at enterprise AI workloads. These include the Dynamic Compute Engine, introduced in June 2026, which offers ephemeral compute resources suitable for AI tasks, similar to solutions from Snowflake and Databricks. Additionally, the Active Compute Engine supports high-concurrency AI workloads, capable of managing tens of thousands of concurrent agents.

A new context layer facilitates AI agents' understanding of enterprise data structures, initially developed for Teradata data and later extended to integrate with Google BigQuery.

The company's go-to-market strategy has evolved with the Forward Deployed Engineering program, which integrates consulting, sales, and systems engineering to help customers transition from proof of concept to production deployment. This approach is tailored to industry verticals such as military, financial services, telecommunications, and healthcare, aiming to turn concepts into production deployments typically within 6 to 9 months.

Management reported positive trends in retention and annual recurring revenue (ARR) growth. Retention improved in both 2025 and 2026, while ARR returned to growth in 2025 and is expected to accelerate in 2026. R&D spending stands at approximately $110 million, focused on platform differentiation and innovation. Despite the progress, McMillan acknowledged that full monetization of new products may take longer, extending into 2027.

The company's hybrid deployment strategy reflects the trend towards flexible choices based on compliance, cost, and performance, emphasizing the option for customers to maintain data sovereignty within controlled environments.