Teradata Earnings Call Nuggets: Promising Q4 Metrics and Legacy Business
Promising Q4 Metrics
Katy Huberty – Morgan Stanley: There were number of promising metrics in the fourth quarter. Consulting growth accelerated off of the lows in June, deferred revenue was better than seasonal. It looks like you invested the revenue upside in more sales heads and just based on the DSOs it looks like you saw strength in December similar to what AMC and others commented on. So, can you just help us better reconcile those metrics which would suggest that a good growth rate continues with your more cautious comments on the first half. I understand there’s tough compares, but what are you really seeing that would offset those metrics that suggest that you’re setup for a pretty good 2013?
Michael F. Koehler – President and CEO: I think what you are alluding to, if you look at the fundamentals in the Company, the fundamentals are very, very sound and we’re going to continue to invest at a rate that we’ve been investing in the past several years and longer-term we see a very good picture for Teradata. Basically what’s happened shorter-term is the economic uncertainty and then in particular the number of large deals that we currently have in play and the size of those large deals are down in the Americas. So, that is the one metric when you step back and look at everything that has caused a conservatism in our guidance when you look at the entire year for 2013.
Katy Huberty – Morgan Stanley: Did you just as a quick follow-up, did you also see weak or lower number of large deals in the fourth quarter?
Michael F. Koehler – President and CEO: We definitely did in the third quarter. The fourth quarter in the Americas actually came back a little bit. There might have been just a little bit of budget flushing, so the number of large deals and the size of the deals in Q4 were down, but not to the degree they were in the third quarter and not what we’re currently seeing right now. I just want to comment that this is what we’re seeing right now. Everything is subject to change and you know we will adjust guidance appropriately if in fact anything does change here in the near future.