Claire Bramley: Thank you, Wamsi.
Operator: Our next question comes from Pat Walravens from JMP Securities. Your line is now open.
Pat Walravens: Oh, great. Thank you, and let me add my congratulations. Steve, how would you say the competitive environment for Teradata today has changed from what it was three years ago?
Steve McMillan: Hey, Pat, thanks for — that’s a very direct into the point question. In terms of the competitive environment, I think we’ve repositioned the company. So, we’ve gone from a company that was focused on being the best on-prem enterprise data warehouse, and we have repositioned the company as a leader in cloud database management systems in the marketplace. And our customers are looking at us now as being the right choice to continue their investment in data and analytics, but not only that moves the most complex workloads that they have in their on-prem systems that they were unable to migrate to the cloud and take those to the cloud now. And now with the launch of VantageCloud Lake and ClearScape Analytics, that’s just building on the capabilities that we have from a cloud perspective and setting apart or differentiates the value proposition.
And I mentioned it a little bit earlier in the Q&A session and also in my prepared remarks, if you look at where this — what this company has done in the last 2.5 years, it’s increased its cloud ARR six-fold to over $350 million of cloud ARR. You don’t do that without significantly changing your positioning in the marketplace, how our customers view us and how our customers view us in terms of being a strategic platform that can integrate into their environments of the future to deliver the most complex workloads and capabilities that they have — that they need to address the environment that we’re working in. So, I think compared to three years ago, we’re a completely different company.
Pat Walravens: Yes, I agree. And — but what — in terms of who you’re competing against, how has that evolved? And I know this is a big picture, but I think it’s helpful.
Steve McMillan: Yes, I think if (ph) the Gartner Magic Quadrant, you can really — you can see the competitive landscape from a cloud DBMS perspective. From — as we look at competition, we think about it in three segments. We think about it from a traditional competitive perspective with the Oracles and IBMs, but clearly, we’ve got a fantastic differentiated capability. We think about it in terms of the native capabilities that the CSPs put out there, like (ph) from AWS or the native services from Microsoft or Google, and then you’ve got the kind of new cloud native entrants like Snowflake and Databricks. Our new next-generation platform enables us to win across all three segments of the competition that we see, we can differentiate from a capabilities perspective, from an enterprise performance perspective, from a cost per query perspective, and also just the fundamental capabilities of the Teradata platform have completely changed.
So, we can — we feel very confident and our sales teams feel very confident now about going out and positioning Teradata as a future platform to take on the likes of Databricks to win back workload from Snowflake and to win against competition in the marketplace. And certainly, all of the decisions that we come across from a migration perspective or from a new logo perspective is against competitive activity. Our customers are smart customers. They want to make sure that they get the best possible deal in the marketplace and I’m really proud how the Teradata capabilities stack up competitively against the new cloud native providers, against the CSP capabilities and against our traditional competitors in terms of delivering something that none of those organizations can deliver alone.
Pat Walravens: Awesome. Thank you.
Steve McMillan: Thanks, Pat.
Operator: Our last question today comes from Howard Ma from Guggenheim Securities. Your line is now open.
Howard Ma: Okay. Great. Thanks for fitting me in. I have one question for Steve and a follow-up for Claire. First for Steve. I want to ask you about your go-to-market strategy and how that will continue to evolve in 2023 to put VantageCloud products more at the forefront of customers’ buying decisions? So, Steve, you mentioned making a significant investment in partner ecosystem in 2022. So, specifically, this year, what are you doing incrementally from a partner standpoint, also from a sales incentive standpoint or any notable changes in pricing and packaging?
Steve McMillan: Yes, thanks for the question, Howard. The — just from — I’ll start in the reverse order. From a pricing and packaging perspective, we launched a new pricing model through 2022. It’s probably one of the most flexible and dynamic pricing models that’s in the marketplace. We certainly believe that in terms of having both effects and consumption-based approach, which gives us certainty in terms of our P&L and our outlook for 2023. From a sales incentive perspective, we are incenting our sales force even more to be working with partners. We’re incenting our consulting teams to ensure that they are there to help work with and enable SIs and resellers in terms of working with the Teradata ecosystem. We’re investing in capabilities as being part of the developer ecosystem in 2023.
That’s an investment area for us in terms of ensuring that we capture the hearts and minds of developers and (ph) their customers and potential customers, and then continuing to invest both with CSPs and the systems integrators. We said that in the prepared remarks, 75% of the large transactions that we executed had systems integrators engaged and involved. We’d like to take that to 100%. We see tremendous interest from the SIs, I’ll mention Accenture as an example of that. Some of the strategic partnership that we have with Accenture in terms of jointly taking industry value propositions to our customers, having those system integrators invest in solution capabilities built on Teradata that utilize capabilities that only Teradata can perform and execute at scale, given the masses of data that some of these industry solutions require, we’re going to continue to see an acceleration of that.
I know you’ve got a question for Claire, so I’ll stop there and let you ask that.
