8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (date of earliest event reported): August 7, 2014

TERADATA CORPORATION

(Exact name of registrant as specified in its charter)

Commission File Number 001-33458

Delaware	75-3236470
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

10000 Innovation Drive

Dayton, Ohio 45342

(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code: (866) 548-8348

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition.

The Company is furnishing the following information as required under Item 2.02 “Results of Operations and Financial Condition” of Form 8-K and Item 7.01 “Regulation FD Disclosure.” Such information, including Exhibit 99.1 attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934.

On August 7, 2014, the Company issued a press release setting forth its second quarter 2014 revenue and earnings per share amounts. A copy of the press release is attached hereto as Exhibit 99.1 and hereby incorporated by reference.

Item 7.01 Regulation FD Disclosure.

The information set forth above under Item 2.02 “Results of Operations and Financial Condition” is furnished pursuant to this Item 7.01 and Exhibit 99.1 is hereby incorporated by reference into this Item 7.01.

The discussion under the heading “Balance Sheet” in the press release incorrectly stated that Teradata had purchased 4.5 million shares for approximately $190 million during the year to date through July 31. The purchases reported were actually for the year to date through June 30, the end of the second quarter.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits:

The following exhibits are attached with this current report on Form 8-K:

Exhibit No.	Description
99.1	Press Release, dated August 7, 2014, issued by the Company.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	TERADATA CORPORATION
Date: August 7, 2014	By:	/s/ Stephen M. Scheppmann
		Stephen M. Scheppmann
		Executive Vice President and Chief Financial Officer

Index to Exhibits

Exhibit No.	Description
99.1	Press Release, dated August 7, 2014, issued by the Company.

EX-99.1

Exhibit 99.1

NEWS RELEASE

Teradata Reports 2014 Second Quarter Results

• Revenue increased 1 percent in the second quarter, as reported and in constant currency⁽¹⁾

• International revenue increased 14 percent in the second quarter

• GAAP EPS $0.60, non-GAAP EPS $0.72 ⁽²⁾

• Cash from Operations for the first six months increased 26 percent versus prior year

ATLANTA, Georgia (August 7, 2014) – Teradata Corp. (NYSE: TDC) reported revenue of $676 million for the quarter ended June 30, 2014, an increase of 1 percent from $670 million in the second quarter of 2013. Revenue in the second quarter increased 1 percent when compared in constant currency.⁽¹⁾

Gross margin was 54.9 percent, as reported under U.S. Generally Accepted Accounting Principles (GAAP), versus 56.6 percent in the second quarter of 2013. On a non-GAAP basis, excluding stock-based compensation expense and the other special items described in footnote #2, gross margin was 56.1 percent, versus 57.9 percent in the second quarter of 2013.⁽²⁾

Teradata reported second quarter net income of $96 million, or $0.60 per diluted share, which compared to net income of $108 million, or $0.65 per diluted share, in the second quarter of 2013. Stock-based compensation expense and other special items reduced Teradata’s second quarter net income by $18 million (or 12 cents of EPS) as reported under GAAP.⁽²⁾ Excluding stock-based compensation expense and the other special items detailed in footnote #2, non-GAAP net income in the second quarter of 2014 was $114 million, or $0.72 per diluted share, versus $126 million, or $0.76 per diluted share, in the second quarter of 2013.⁽²⁾

“We made good progress in several areas of our business in the quarter, and for the first half. New data warehouse customer wins were the second highest ever recorded for a Q2 and for a first half. International revenue was up 14 percent in the second quarter, and up 10 percent for the first half,” said Mike Koehler, president and chief executive officer, Teradata Corporation. “We continue to experience strong activity with our Unified Data Architecture, Teradata Aster and big data-related solutions and services, as customers build out their analytical ecosystems.”

1

Segment Revenue Performance

(in millions)

	For the Three Months Ended June 30
	2014		2013		% Change as Reported			% Change in Constant Currency(1)
Americas	$	374	$	405		-8	%		-7	%
International	$	302	$	265		14	%		13	%
Total Revenue	$	676	$	670		1	%		1	%

	For the Six Months Ended June 30
	2014		2013		% Change as Reported			% Change in Constant Currency(1)
Americas	$	758	$	760		0	%		0	%
International	$	546	$	497		10	%		10	%
Total Revenue	$	1,304	$	1,257		4	%		4	%

Operating Income

Second quarter operating income of $133 million decreased from $147 million reported in the second quarter of 2013. On a non-GAAP basis, operating income was $159 million versus $174 million in the second quarter of 2013.⁽²⁾ The difference was primarily due to lower margins from increased amortization of previously capitalized software development costs, lower service margins, and higher operating expenses including increased research and development expense.

Cash Flow

During the second quarter of 2014, Teradata generated $138 million of cash from operating activities, which compared to $140 million in the prior-year period. Teradata generated $113 million of free cash flow (cash from operating activities less capital expenditures and additions to capitalized software)⁽³⁾ in the second quarter of 2014, versus $102 million in the same period in 2013.

Year to date, Teradata generated $481 million of cash from operating activities, compared to $383 million in the prior-year period. Teradata generated $423 million of free cash flow⁽³⁾ in the first six months of 2014, a 33 percent increase from $318 million generated in the same period in 2013.

Balance Sheet

Teradata ended the quarter with $934 million in cash, a $12 million increase from March 31, 2014. During the quarter, Teradata purchased approximately 2.5 million shares of its stock for approximately $104 million during the quarter. Year to date, through July 31, Teradata purchased 4.5 million shares for approximately $190 million.

2

As of June 30, 2014, Teradata had total debt of $263 million outstanding under a term loan. Additionally, Teradata has $300 million available through a pre-arranged credit facility; however, no funds were drawn from the credit facility.

2014 Outlook

Teradata continues to expect full-year 2014 revenue to grow at the lower end of its original 3-7 percent guidance range. Based on currency rates at the end of July 2014, currency translation is not expected to have a meaningful impact on Teradata’s full-year revenue comparison.⁽¹⁾ Teradata also continues to expect 2014 non-GAAP earnings per share (which excludes stock-based compensation expense and other special items) to be at the lower end of the $2.85-$3.00 range.⁽²⁾

2014 Second Quarter Earnings Conference Call

A conference call is scheduled today at 8:30 a.m. (ET) to discuss the company’s second quarter 2014 results. Access to the conference call, as well as a replay of the call, is available on Teradata’s web site at investor.teradata.com.

Supplemental financial information regarding Teradata’s operating results is also available on the Investor Relations page of Teradata’s web site.

1. The impact of currency is determined by calculating the prior-period results using the current-year monthly average currency rates. See the foreign currency fluctuation schedule on the Investor Relations page of the company’s web site at investor.teradata.com, which is used to determine revenue on a constant currency (cc) basis.

(in millions)

	For the Three Months										For the Six Months
	Ended June 30										Ended June 30
	2014		2013		Chg As Rpt’d			Chg In CC			2014		2013		Chg As Rpt’d			Chg In CC
Revenue
Products (software/hardware)	$	300	$	303		-1	%		-1	%	$	573	$	552		4	%		4	%
Consulting services	$	203	$	207		-2	%		-2	%	$	392	$	393		0	%		0	%
Maintenance services	$	173	$	160		8	%		9	%	$	339	$	312		9	%		10	%
Total Services	$	376	$	367		2	%		3	%	$	731	$	705		4	%		4	%
Total Revenue	$	676	$	670		1	%		1	%	$	1,304	$	1,257		4	%		4	%
By segment
Americas	$	374	$	405		-8	%		-7	%	$	758	$	760		0	%		0	%
International	$	302	$	265		14	%		13	%	$	546	$	497		10	%		10	%
Total Revenue	$	676	$	670		1	%		1	%	$	1,304	$	1,257		4	%		4	%

3

2. Teradata reports its results in accordance with GAAP. However, as described below, the company believes that certain non-GAAP measures (such as non-GAAP gross margin, non-GAAP operating income, non-GAAP net income, and non-GAAP earnings per diluted share, or EPS, which exclude certain items as well as free cash flow) are useful for investors. Our non-GAAP measures are not meant to be considered in isolation or as substitutes for, or superior to, results determined in accordance with GAAP, and should be read only in conjunction with our condensed consolidated financial statements prepared in accordance with GAAP.

Special items included in Teradata’s 2014 second quarter GAAP operating income results as reported in this release included $13 million of stock-based compensation expense; $11 million of amortization of acquisition-related intangible assets; and $2 million of acquisition, integration and reorganization expenses. In addition to the special items included in Teradata’s 2014 second quarter GAAP operating income, Teradata’s GAAP net income also included a $1 million impairment of an equity investment.

Teradata’s year-to-date 2013 GAAP net income included a $4 million income tax benefit related to the 2012 U.S. Research & Development tax credit. This benefit was included in Teradata’s non-GAAP results in the fourth quarter of 2012, since the benefit related to the 2012 tax reporting period. However, Teradata could not include the tax benefit in its GAAP results in the fourth quarter of 2012 due to the American Taxpayer Relief Act of 2012 not being enacted until January 2013. As a result, the $4 million tax benefit was included in Teradata’s 2013 GAAP net income, but was excluded from the company’s non-GAAP net income.

The following tables reconcile Teradata’s actual and projected results and EPS under GAAP to the company’s actual and projected non-GAAP results and EPS for the periods presented, which exclude certain items. Our management regularly uses supplemental non-GAAP financial measures, such as gross margin, operating income, net income and EPS, excluding certain items internally, to understand, manage and evaluate our business and support operating decisions. The company believes such non-GAAP financial measures (1) provide useful information to investors regarding the underlying business trends and performance of the company’s ongoing operations, (2) are useful for period-over-period comparisons of such operations and results, that may be more easily compared to peer companies and allow investors a view of the company’s operating results excluding special items, (3) provide useful information to management and investors regarding present and future business trends, and (4) provide consistency and comparability with past reports and projections of future results.

Teradata’s reconciliation of GAAP to non-GAAP results included in this release:

(in millions, except per share data)

	For the Three Months									For the Six Months
	Ended June 30									Ended June 30
	2014			2013			Chg as Rpt’d			2014			2013			Chg As Rpt’d
Gross Margin:
GAAP Gross Margin	$	371		$	379			-2	%	$	704		$	684			3	%
% of Revenue		54.9	%		56.6	%					54.0	%		54.4	%
Excluding:
Stock-based compensation expense		3			2						6			3
Amortization of acquisition-related intangible assets		5			6						10			13
Acquisition, integration and reorganization related costs		—			1						4			1
Non-GAAP Gross Margin	$	379		$	388			-2	%	$	724		$	701			3	%
% of Revenue		56.1	%		57.9	%					55.5	%		55.8	%
Operating Income:
GAAP Operating Income	$	133		$	147			-10	%	$	222		$	223			0	%
% of Revenue		19.7	%		21.9	%					17.0	%		17.7	%
Excluding:
Stock-based compensation expense		13			14						25			27
Amortization of acquisition-related intangible assets		11			10						23			22
Acquisition, integration and reorganization related costs		2			3						14			6
Non-GAAP Operating Income	$	159		$	174			-9	%	$	284		$	278			2	%
% of Revenue		23.5	%		26.0	%					21.8	%		22.1	%

4

	For the Three Months									For the Six Months
	Ended June 30									Ended June 30
	2014			2013			Chg as Rpt’d			2014			2013			Chg As Rpt’d
Net Income:
GAAP Net Income	$	96		$	108			-11	%	$	155		$	167			-7	%
% of Revenue		14.2	%		16.1	%					11.9	%		13.3	%
Excluding:
Stock-based compensation expense		9			10						17			18
Amortization of acquisition-related intangible assets		7			6						15			14
Acquisition, integration and reorganization related costs		1			2						8			4
Net loss on equity investments		1			—						6			—
2012 R&D Tax Credit, enacted in 2013		—			—						—			(4	)
Non-GAAP Net Income	$	114		$	126			-10	%	$	201		$	199			1	%
% of Revenue		16.9	%		18.8	%					15.4	%		15.8	%

	For the Three Months				For the Six Months
	Ended June 30				Ended June 30
Diluted Earnings Per Share:	2014		2013		2014		2013			2014 Full Year Guidance
GAAP Diluted Earnings Per Share	$	0.60	$	0.65	$	0.97	$	1.00		$	2.33 - $2.48
Excluding:
Stock-based compensation expense	$	0.06	$	0.06	$	0.11	$	0.11		$	0.22
Amortization of acquisition-related intangible assets	$	0.04	$	0.04	$	0.09	$	0.08		$	0.19
Acquisition, integration and reorganization related costs	$	0.01	$	0.01	$	0.05	$	0.02		$	0.08
Net loss on equity investments	$	0.01		—	$	0.03		—		$	0.03
2012 R&D Tax Credit, enacted in 2013		—		—		—	($	0.02	)		—
Non-GAAP Diluted Earnings Per Share	$	0.72	$	0.76	$	1.25	$	1.19		$	2.85 - $3.00

3. As described above, the company believes that free cash flow is a useful non-GAAP measure for investors. Teradata defines free cash flow as cash provided/used by operating activities less capital expenditures for property and equipment, and additions to capitalized software. Free cash flow does not have a uniform definition under GAAP and therefore, Teradata’s definition may differ from other companies’ definitions of this measure. Teradata’s management uses free cash flow to assess the financial performance of the company and believes it is useful for investors because it relates the operating cash flow of the company to the capital that is spent to continue and improve business operations. In particular, free cash flow indicates the amount of cash generated after capital expenditures for, among other things, investment in the company’s existing businesses, strategic acquisitions, strengthening the company’s balance sheet, repurchase of the company’s stock and repayment of the company’s debt obligations, if any. Free cash flow does not represent the residual cash flow available for discretionary expenditures since there may be other nondiscretionary expenditures that are not deducted from the measure. This non-GAAP measure is not meant to be considered in isolation, as a substitute for, or superior to, results determined in accordance with GAAP, and should be read only in conjunction with our condensed consolidated financial statements prepared in accordance with GAAP.

5

	For the Three Months Ended June 30						For the Six Months Ended June 30
	(in millions)						(in millions)
	2014			2013			2014			2013
Cash provided by operating activities (GAAP)	$	138		$	140		$	481		$	383
Less capital expenditures for:
Expenditures for property and equipment		(9	)		(21	)		(21	)		(31	)
Additions to capitalized software		(16	)		(17	)		(37	)		(34	)
Total capital expenditures		(25	)		(38	)		(58	)		(65	)
Free Cash Flow (non-GAAP measure)	$	113		$	102		$	423		$	318

Note to Investors

This news release contains forward-looking statements, including statements as to anticipated or expected results, beliefs, opinions and future financial performance, within the meaning of Section 21E of the Securities and Exchange Act of 1934. Forward-looking statements include projections of revenue, profit growth and other financial items, future economic performance and statements concerning analysts’ earnings estimates, among other things. These forward-looking statements are based on current expectations and assumptions and involve risks and uncertainties that could cause Teradata’s actual results to differ materially. In addition to the factors discussed in this release, other risks and uncertainties could affect our future results, and could cause actual results to differ materially from those expressed in such forward-looking statements. Such factors include those relating to: the global economic environment in general or on the ability of our suppliers to meet their commitments to us, or the timing of purchases by our current and potential customers, and other general economic and business conditions; the rapidly changing and intensely competitive nature of the information technology industry and the data analytics business, including the increased pressure on price/performance for data analytics solutions; fluctuations in our operating results, unanticipated delays or accelerations in our sales cycles and the difficulty of accurately estimating revenues; risks inherent in operating in foreign countries, including the impact of economic, political, legal, regulatory, compliance, cultural, foreign currency fluctuations and other conditions abroad; the timely and successful development, production or acquisition and market acceptance of new and existing products and services, including our ability to accelerate market acceptance of new products and services as well as the reliability, quality, security and operability of new products because of the difficulty and complexity associated with their testing and production; tax rates; turnover of workforce and the ability to attract and retain skilled employees; availability and successful exploitation of new acquisition and alliance opportunities; our ability to execute integration plans for newly acquired entities, including the possibility that expected synergies and operating efficiencies may not be achieved, that such integration efforts may be more difficult, time-consuming or costly than expected, and that operating costs, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, clients or suppliers) may be greater than expected following the transaction; recurring revenue may decline or fail to be renewed; changes in Generally Accepted Accounting Principles (GAAP) and the resulting impact, if any, on the company’s accounting policies; continued efforts to establish and maintain best-in-class and secure internal information technology and control systems; and other factors described from time-to-time in the company’s filings with the U.S. Securities and Exchange Commission, including its annual report on Form 10-K and subsequent quarterly reports on Forms 10-Q, as well as the company’s annual reports to stockholders. The company does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

About Teradata

Teradata (NYSE: TDC), a global leader in analytic data platforms, marketing applications, and consulting services, helps organizations become more competitive by increasing the value of their data and customer relationships. Visit teradata.com for details.

Get to know Teradata:

Teradata is a trademark or registered trademark of Teradata Corporation in the United States and other countries.

INVESTOR CONTACT: Gregg Swearingen Teradata (937) 242-4600 gregg.swearingen@teradata.com MEDIA CONTACT: Mike O’Sullivan Teradata (937) 242-4786 mike.osullivan@teradata.com

# # #

6

Schedule A

TERADATA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in millions, except per share amounts - unaudited)

	For the Period Ended June 30
	Three Months									Six Months
	2014			2013			% Chg			2014			2013			% Chg
Revenue
Products	$	300		$	303			-1	%	$	573		$	552			4	%
Services		376			367			2	%		731			705			4	%
Total revenue		676			670			1	%		1,304			1,257			4	%
Product gross margin		195			202						376			358
% of Revenue		65.0	%		66.7	%					65.6	%		64.9	%
Services gross margin		176			177						328			326
% of Revenue		46.8	%		48.2	%					44.9	%		46.2	%
Total gross margin		371			379						704			684
% of Revenue		54.9	%		56.6	%					54.0	%		54.4	%
Selling, general and administrative expenses		188			185						376			364
Research and development expenses		50			47						106			97
Income from operations		133			147						222			223
% of Revenue		19.7	%		21.9	%					17.0	%		17.7	%
Other expense, net		(1	)		—						(8	)		(1	)
Income before income taxes		132			147						214			222
% of Revenue		19.5	%		21.9	%					16.4	%		17.7	%
Income tax expense		36			39						59			55
% Tax rate		27.3	%		26.5	%					27.6	%		24.8	%
Net income	$	96		$	108					$	155		$	167
% of Revenue		14.2	%		16.1	%					11.9	%		13.3	%
Net income per common share
Basic	$	0.61		$	0.66					$	0.98		$	1.02
Diluted	$	0.60		$	0.65					$	0.97		$	1.00
Weighted average common shares outstanding
Basic		156.9			163.4						157.7			164.4
Diluted		159.4			166.3						160.2			167.4

Schedule B

TERADATA CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions - unaudited)

	June 30,			March 31,			December 31,
	2014			2014			2013
Assets
Current assets
Cash and cash equivalents	$	934		$	922		$	695
Accounts receivable, net		550			607			717
Inventories		50			42			56
Other current assets		103			88			95
Total current assets		1,637			1,659			1,563
Property and equipment, net		156			159			161
Capitalized software, net		196			199			195
Goodwill		950			946			946
Acquired intangible assets		126			138			149
Deferred income taxes		24			24			24
Other assets		47			53			58
Total assets	$	3,136		$	3,178		$	3,096
Liabilities and stockholders’ equity
Current liabilities
Accounts payable	$	112		$	97		$	114
Payroll and benefits liabilities		125			133			136
Deferred revenue		442			499			390
Other current liabilities		167			153			136
Total current liabilities		846			882			776
Long-term debt		225			240			248
Pension and other postemployment plan liabilities		72			75			76
Long-term deferred revenue		26			24			25
Deferred tax liabilities		73			78			87
Other liabilities		32			30			27
Total liabilities		1,274			1,329			1,239
Stockholders’ equity
Preferred stock		—			—			—
Common stock		2			2			2
Paid-in capital		1,012			993			973
Treasury Stock		(1,374	)		(1,270	)		(1,184	)
Retained earnings		2,188			2,092			2,033
Accumulated other comprehensive income		34			32			33
Total stockholders’ equity		1,862			1,849			1,857
Total liabilities and stockholders’ equity	$	3,136		$	3,178		$	3,096

Schedule C

TERADATA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions - unaudited)

	For the Period Ended June 30
	Three Months						Six Months
	2014			2013			2014			2013
Operating activities
Net income	$	96		$	108		$	155		$	167
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		43			36			84			70
Stock-based compensation expense		13			14			25			27
Excess tax benefit from stock-based compensation		—			(1	)		(1	)		(4	)
Deferred income taxes		(7	)		—			(12	)		6
Loss on investments		1			—			9			—
Changes in assets and liabilities:
Receivables		57			(1	)		168			157
Inventories		(8	)		(5	)		6			(23	)
Current payables and accrued expenses		(1	)		15			2			(72	)
Deferred revenue		(56	)		(38	)		53			46
Other assets and liabilities		—			12			(8	)		9
Net cash provided by operating activities		138			140			481			383
Investing activities
Expenditures for property and equipment		(9	)		(21	)		(21	)		(31	)
Additions to capitalized software		(16	)		(17	)		(37	)		(34	)
Business acquisitions and other investing activities		(3	)		(39	)		(7	)		(39	)
Net cash used in investing activities		(28	)		(77	)		(65	)		(104	)
Financing activities
Repurchases of common stock		(98	)		(91	)		(184	)		(184	)
Repayments of long-term borrowings		(7	)		(4	)		(11	)		(8	)
Excess tax benefit from stock-based compensation		—			1			1			4
Other financing activities, net		7			8			14			15
Net cash used in financing activities		(98	)		(86	)		(180	)		(173	)
Effect of exchange rate changes on cash and cash equivalents		—			(4	)		3			(9	)
Increase (decrease) in cash and cash equivalents		12			(27	)		239			97
Cash and cash equivalents at beginning of period		922			853			695			729
Cash and cash equivalents at end of period	$	934		$	826		$	934		$	826

Schedule D

TERADATA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in millions - unaudited)

	For the Period Ended June 30
	Three Months												Six Months
	2014			2013			% Change As Reported			% Change Constant Currency			2014			2013			% Change As Reported			% Change Constant Currency
Segment Revenue
Americas	$	374		$	405			-8	%		-7	%	$	758		$	760			0	%		0	%
International		302			265			14	%		13	%		546			497			10	%		10	%
Total revenue		676			670			1	%		1	%		1,304			1,257			4	%		4	%
Segment gross margin
Americas		217			240									440			435
% of Revenue		58.0	%		59.3	%								58.0	%		57.2	%
International		154			139									264			249
% of Revenue		51.0	%		52.5	%								48.4	%		50.1	%
Total gross margin		371			379									704			684
% of Revenue		54.9	%		56.6	%								54.0	%		54.4	%
Selling, general and administrative expenses		188			185									376			364
Research and development expenses		50			47									106			97
Income from operations	$	133		$	147								$	222		$	223
% of Revenue		19.7	%		21.9	%								17.0	%		17.7	%