Teddy has correctly set up the inequality to represent the problem, and upon solving, he found that \( x > 120 \).
In this context, \( x \) represents the number of customers James serves. Since the solution indicates that \( x \) must be greater than 120, Teddy should interpret this as:
James needs to serve more than 120 customers this week to meet his goal.
So, the correct interpretation is: James needs to serve more than 120 customers this week to meet his goal.