Segment, Other Supplemental Information and Concentrations

12 Months Ended

Dec. 31, 2019

Segment, Other Supplemental Information and Concentrations

Effective January 1, 2019, Teradata implemented an organizational change in which Teradata now manages its business under three geographic regions, which are also the Company’s operating segments: (1) Americas region (North America and Latin America); (2) EMEA region (Europe, Middle East and Africa) and (3) APAC 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, who is our Interim 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 periods have been restated to conform to the current year presentation.

The following table presents segment revenue and segment gross profit for the Company for the years ended December 31:



In millions	2019		2018		2017
Segment revenue
Americas	$	1,057	$	1,126	$	1,195
EMEA	492		587		567
APAC	350		451		394
Total revenue	1,899		2,164		2,156
Segment gross profit
Americas	626		621		675
EMEA	239		275		276
APAC	148		199		161
Total segment gross profit	1,013		1,095		1,112
Stock-based compensation expense	14		15		13
Acquisition, integration and reorganization-related costs	11		5		4
Amortization of capitalized software costs	33		49		71
Total gross profit	955		1,026		1,024
Selling, general and administrative expenses	618		666		651
Research and development expenses	327		317		305
Total income from operations	$	10	$	43	$	68

Prior period segment information has been reclassified to conform to the current period presentation. Certain items, including amortization of certain capitalized software 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	2019		2018		2017
United States	$	953	$	1,018	$	1,089
Americas (excluding United States)	104		108		106
EMEA	492		587		567
APAC	350		451		394
Total revenue	$	1,899	$	2,164	$	2,156

The following table presents property and equipment, net by geographic area at December 31:



In millions	2019		2018
United States	$	261	$	226
Americas (excluding United States)	19		18
EMEA	36		26
APAC	34		25
Property and equipment, net	$	350	$	295

Concentrations. No single customer accounts for more than 10% of the Company's revenue. As of December 31, 2019, 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 exclusively 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.