Teradata (TDC) is expected to benefit from growth in artificial intelligence workloads and continued execution in H2, RBC Capital Markets said in a note on Wednesday.

The company is seeing growth in a loyal customer base for both on-premises and cloud offerings, which will lead to earnings expansion in 2026, the note said.

RBC said the company expects annual recurring revenue, or ARR ,to decline in Q1 due to typical seasonality, but with stabilization and expansion through the year, with most of the growth in the second half.

Current guidance does not fully incorporate the significant incremental ARR potential, suggesting upside if execution accelerates and new products are launched in Q2 and Q3, RBC said.

RBC maintained its sector-perform rating on the stock and raised its price target to $35 from $32.

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