TER 10-Q

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Teradyne, Inc (TER)

10-Q 2021-11-05 For: 2021-10-03

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Added on April 10, 2026

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Massachusetts		04-2272148
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

600 Riverpark Drive, North Reading, Massachusetts		01864
(Address of Principal Executive Offices)		(Zip Code)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.125 per share	TER	Nasdaq Stock Market LLC


		Page No.

	PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements (Unaudited):

	Condensed Consolidated Balance Sheets as of October 3, 2021 and December 31, 2020		1

	Condensed Consolidated Statements of Operations for the Three and Nine Months Ended October 3, 2021 and September 27, 2020		2

	Condensed Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended October 3, 2021 and September 27, 2020		3

	Condensed Consolidated Statements of Shareholders’ Equity for the Three and Nine Months Ended October 3, 2021 and September 27, 2020		4

	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended October 3, 2021 and September 27, 2020		5

	Notes to Condensed Consolidated Financial Statements		6

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		28

Item 3.	Quantitative and Qualitative Disclosures about Market Risk		38

Item 4.	Controls and Procedures		39

	PART II. OTHER INFORMATION

Item 1.	Legal Proceedings		39

Item 1A.	Risk Factors		39

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		40

Item 4.	Mine Safety Disclosures		41

Item 6.	Exhibits		42


	October 3, 2021		December 31, 2020

	(in thousands, except per share amount)
ASSETS
Current assets:
Cash and cash equivalents	$	1,079,454	$	914,121
Marketable securities		233,397		522,280
Accounts receivable, less allowance for credit losses of $1,913 and $2,034 at October 3, 2021 and December 31, 2020, respectively		597,124		497,506
Inventories, net		224,242		222,189
Prepayments and other current assets		386,967		259,338

Total current assets		2,521,184		2,415,434
Property, plant and equipment, net		390,545		394,800
Operating lease right-of-use assets, net		61,608		54,569
Marketable securities		136,664		117,980
Deferred tax assets		96,808		87,913
Retirement plans assets		16,958		17,468
Other assets		23,340		9,384
Acquired intangible assets, net		81,677		100,939
Goodwill		433,398		453,859

Total assets	$	3,762,182	$	3,652,346

LIABILITIES
Current liabilities:
Accounts payable	$	154,912	$	133,663
Accrued employees’ compensation and withholdings		196,928		220,321
Deferred revenue and customer advances		140,380		134,662
Other accrued liabilities		135,492		77,581
Operating lease liabilities		20,601		20,573
Income taxes payable		73,077		80,728
Current debt		32,219		33,343

Total current liabilities		753,609		700,871
Retirement plans liabilities		153,249		151,140
Long-term deferred revenue and customer advances		60,022		58,359
Long-term contingent consideration		—		7,227
Long-term other accrued liabilities		19,704		19,352
Deferred tax liabilities		6,907		10,821
Long-term operating lease liabilities		48,492		42,073
Long-term incomes taxes payable		67,041		74,930
Debt		112,784		376,768

Total liabilities		1,221,808		1,441,541

Commitments and contingencies
Mezzanine equity:
Convertible common shares		2,881		3,787
SHAREHOLDERS’ EQUITY
Common stock, $0.125 par value, 1,000,000 shares authorized; 163,728 and 166,123 shares issued and outstanding at October 3, 2021 and December 31, 2020, respectively		20,466		20,765
Additional paid-in capital		1,800,373		1,765,323
Accumulated other comprehensive income		4,217		33,516
Retained earnings		712,437		387,414

Total shareholders’ equity		2,537,493		2,207,018

Total liabilities, convertible common shares and shareholders’ equity	$	3,762,182	$	3,652,346


	For the Three Months Ended						For the Nine Months Ended
	October 3, 2021			September 27, 2020			October 3, 2021			September 27, 2020

	(in thousands, except per share amount)
Revenues:
Products	$	825,448		$	697,745		$	2,437,901		$	2,043,281
Services		125,053			121,739			379,934			319,219

Total revenues		950,501			819,484			2,817,835			2,362,500
Cost of revenues:
Cost of products		333,229			300,174			989,859			882,902
Cost of services		46,271			60,382			148,368			143,647

Total cost of revenues (exclusive of acquired intangible assets amortization shown separately below)		379,500			360,556			1,138,227			1,026,549

Gross profit		571,001			458,928			1,679,608			1,335,951
Operating expenses:
Selling and administrative		134,829			115,840			404,812			340,488
Engineering and development		107,220			94,909			317,644			274,170
Acquired intangible assets amortization		5,355			6,219			16,293			25,052
Restructuring and other		1,197			(27,701	)		(3,426	)		1,915

Total operating expenses		248,601			189,267			735,323			641,625

Income from operations		322,400			269,661			944,285			694,326
Non-operating (income) expense:
Interest income		(626	)		(1,071	)		(2,066	)		(5,189	)
Interest expense		3,785			6,237			15,354			17,831
Other (income) expense, net		21,486			764			25,223			3,595

Income before income taxes		297,755			263,731			905,774			678,089
Income tax provision		41,037			41,013			115,225			90,274

Net income	$	256,718		$	222,718		$	790,549		$	587,815

Net income per common share:
Basic	$	1.56		$	1.34		$	4.77		$	3.54

Diluted	$	1.41		$	1.21		$	4.26		$	3.23

Weighted average common shares—basic		164,583			166,014			165,690			166,131

Weighted average common shares—diluted		181,987			184,338			185,492			181,777

				Shareholders’ Equity
	Convertible Common Share s Value			Common Stock Shares			Common Stock Par Value			Additional Paid-in Capital			Accumulated Other Comprehensive Income (Loss)			Retained Earnings (Accumulated Deficit)			Total Shareholders’ Equity

				(in thousands)
For the Three Months Ended October 3, 2021
Balance, July 4, 2021	$	21,386			165,444		$	20,680		$	1,772,302		$	15,322		$	684,952		$	2,493,256
Net issuance of common stock under stock-based plans					8			1			(259	)								(258	)
Stock-based compensation expense											10,042									10,042
Repurchase of common stock					(1,724	)		(215	)								(212,781	)		(212,996	)
Cash dividends ($0.10 per share)																	(16,452	)		(16,452	)
Settlements of convertible notes					5,589			699			636,798									637,497
Exercise of convertible notes hedge call options					(5,589	)		(699	)		(637,015	)								(637,714	)
Convertible common shares		(18,505	)								18,505									18,505
Net income																	256,718			256,718
Other comprehensive loss														(11,105	)					(11,105	)

Balance, October 3, 2021	$	2,881			163,728		$	20,466		$	1,800,373		$	4,217		$	712,437		$	2,537,493


For the Three Months Ended September 27, 2020
Balance, June 28, 2020	$	—			165,806		$	20,725		$	1,730,716		$	(8,500	)	$	1,610		$	1,744,551
Net issuance of common stock under stock-based plans					237			30			13,515									13,545
Stock-based compensation expense											12,600									12,600
Cash dividends ($0.10 per share)																	(16,618	)		(16,618	)
Net income																	222,718			222,718
Other comprehensive income														16,748						16,748

Balance, September 27, 2020	$	—			166,043		$	20,755		$	1,756,831		$	8,248		$	207,710		$	1,993,544


For the Nine Months Ended October 3, 2021
Balance, December 31, 2020	$	3,787			166,123		$	20,765		$	1,765,323		$	33,516		$	387,414		$	2,207,018
Net issuance of common stock under stock-based plans					893			112			(48	)								64
Stock-based compensation expense											35,915									35,915
Repurchase of common stock					(3,288	)		(411	)								(415,769	)		(416,180	)
Cash dividends ($0.30 per share)																	(49,757	)		(49,757	)
Settlements of convertible notes					7,178			897			840,305									841,202
Exercise of convertible notes hedge call options					(7,178	)		(897	)		(842,028	)								(842,925	)
Convertible common shares		(906	)								906									906
Net income																	790,549			790,549
Other comprehensive loss														(29,299	)					(29,299	)

Balance, October 3, 2021	$	2,881			163,728		$	20,466		$	1,800,373		$	4,217		$	712,437		$	2,537,493


For the Nine Months Ended September 27, 2020
Balance, December 31, 2019	$	—			166,410		$	20,801		$	1,720,129		$	(18,854	)	$	(241,918	)	$	1,480,158
Net issuance of common stock under stock-based plans					1,150			144			3,019									3,163
Stock-based compensation expense											33,683									33,683
Repurchase of common stock					(1,517	)		(190	)								(88,275	)		(88,465	)
Cash dividends ($0.30 per share)																	(49,912	)		(49,912	)
Net income																	587,815			587,815
Other comprehensive income														27,102						27,102

Balance, September 27, 2020	$	—			166,043		$	20,755		$	1,756,831		$	8,248		$	207,710		$	1,993,544


	For the Nine Months Ended
	October 3, 2021			September 27, 2020

	(in thousands)
Cash flows from operating activities:
Net income	$	790,549		$	587,815
Adjustments to reconcile net income from operations to net cash provided by operating activities:
Depreciation		67,866			58,111
Stock-based compensation		34,649			33,028
Amortization		27,626			36,577
Loss on convertible debt conversion		25,397			—
Provision for excess and obsolete inventory		11,775			13,116
Deferred taxes		(10,732	)		(4,547	)
Contingent consideration adjustment		(7,227	)		(7,967	)
Gains on investments		(4,750	)		(3,515	)
Retirement plan actuarial (gains) losses		(627	)		2,589
Other		243			750
Changes in operating assets and liabilities, net of businesses acquired:
Accounts receivable		(103,299	)		(222,015	)
Inventories		21,943			16,998
Prepayments and other assets		(138,564	)		(40,751	)
Accounts payable and other liabilities		65,064			81,557
Deferred revenue and customer advances		8,699			36,589
Retirement plans contributions		(4,123	)		(3,884	)
Income taxes		(17,406	)		24,060

Net cash provided by operating activities		767,083			608,511

Cash flows from investing activities:
Purchases of property, plant and equipment		(103,162	)		(146,872	)
Purchases of marketable securities		(509,470	)		(488,428	)
Proceeds from maturities of marketable securities		571,277			309,407
Proceeds from sales of marketable securities		209,437			32,611
Purchase of investment and acquisition of business		(12,000	)		149
Proceeds from life insurance		—			546

Net cash provided by (used for) investing activities		156,082			(292,587	)

Cash flows from financing activities:
Issuance of common stock under stock purchase and stock option plans		32,590			26,528
Repurchase of common stock		(406,180	)		(88,465	)
Payments of convertible debt principal		(301,997	)		—
Dividend payments		(49,711	)		(49,870	)
Payments related to net settlement of employee stock compensation awards		(32,045	)		(22,735	)
Payments of contingent consideration		—			(8,852	)

Net cash used for financing activities		(757,343	)		(143,394	)

Effects of exchange rate changes on cash and cash equivalents		(489	)		(1,274	)

Increase in cash and cash equivalents		165,333			171,256
Cash and cash equivalents at beginning of period		914,121			773,924

Cash and cash equivalents at end of period	$	1,079,454		$	945,180

Non-cash investing activities:
Capital expenditures incurred but not yet paid:	$	2,286		$	3,119


	Semiconductor Test						Industrial Automation
	System on-a-Chip		Memory		System Test		Universal Robots		Mobile Industrial Robots		AutoGuide		Wireless Test		Corporate and Other			Total
	(in thousands)
For the Three Months Ended October 3, 2021 (1)
Timing of Revenue Recognition
Point in Time	$	508,747	$	105,454	$	88,155	$	76,008	$	12,351	$	226	$	65,409	$	(63	)	$	856,287
Over Time		66,270		7,761		14,450		1,742		607		80		3,304		—			94,214

Total	$	575,017	$	113,215	$	102,605	$	77,750	$	12,958	$	306	$	68,713	$	(63	)	$	950,501

Geographical Market
Asia Pacific	$	519,886	$	110,362	$	62,757	$	19,654	$	2,788	$	—	$	54,344	$	—		$	769,791
Americas		29,119		2,281		34,560		23,429		5,015		306		11,352		(63	)		105,999
Europe, Middle East and Africa		26,012		572		5,288		34,667		5,155		—		3,017		—			74,711

Total	$	575,017	$	113,215	$	102,605	$	77,750	$	12,958	$	306	$	68,713	$	(63	)	$	950,501

For the Three Months Ended September 27, 2020 (1)
Timing of Revenue Recognition
Point in Time	$	393,717	$	137,929	$	101,045	$	51,523	$	10,175	$	4,076	$	37,901	$	(41	)	$	736,325
Over Time		55,988		4,507		17,124		1,686		59		1,192		2,603		—			83,159

Total	$	449,705	$	142,436	$	118,169	$	53,209	$	10,234	$	5,268	$	40,504	$	(41	)	$	819,484

Geographical Market
Asia Pacific	$	420,821	$	137,286	$	78,534	$	14,471	$	1,566	$	—	$	33,865	$	—		$	686,543
Americas		17,678		3,730		35,140		16,527		3,981		5,268		5,211		(41	)		87,494
Europe, Middle East and Africa		11,206		1,420		4,495		22,211		4,687		—		1,428		—			45,447

Total	$	449,705	$	142,436	$	118,169	$	53,209	$	10,234	$	5,268	$	40,504	$	(41	)	$	819,484

For the Nine Months Ended October 3, 2021 (2)
Timing of Revenue Recognition
Point in Time	$	1,548,895	$	291,578	$	295,666	$	214,427	$	41,506	$	106	$	154,908	$	(352	)	$	2,546,734
Over Time		188,022		21,776		44,595		5,001		1,483		628		9,596		—			271,101

Total	$	1,736,917	$	313,354	$	340,261	$	219,428	$	42,989	$	734	$	164,504	$	(352	)	$	2,817,835

Geographical Market
Asia Pacific	$	1,618,117	$	301,562	$	223,507	$	55,531	$	8,674	$	—	$	133,678	$	—		$	2,341,069
Americas		71,562		9,373		98,475		66,390		17,065		734		24,228		(352	)		287,475
Europe, Middle East and Africa		47,238		2,419		18,279		97,507		17,250		—		6,598		—			189,291

Total	$	1,736,917	$	313,354	$	340,261	$	219,428	$	42,989	$	734	$	164,504	$	(352	)	$	2,817,835

For the Nine Months Ended September 27, 2020 (2)
Timing of Revenue Recognition
Point in Time	$	1,261,468	$	298,150	$	259,498	$	140,829	$	30,468	$	8,608	$	125,304	$	(294	)	$	2,124,031
Over Time		162,159		14,000		46,553		5,628		176		2,083		7,870		—			238,469

Total	$	1,423,627	$	312,150	$	306,051	$	146,457	$	30,644	$	10,691	$	133,174	$	(294	)	$	2,362,500

Geographical Market
Asia Pacific	$	1,330,463	$	296,679	$	197,208	$	39,665	$	4,391	$	—	$	113,576	$	—		$	1,981,982
Americas		51,315		11,481		91,924		42,634		9,836		10,691		15,253		(294	)		232,840
Europe, Middle East and Africa		41,849		3,990		16,919		64,158		16,417		—		4,345		—			147,678

Total	$	1,423,627	$	312,150	$	306,051	$	146,457	$	30,644	$	10,691	$	133,174	$	(294	)	$	2,362,500


	October 3, 2021		December 31, 2020

	(in thousands)
Raw material	$	131,807	$	114,133
Work-in-process		34,911		25,408
Finished goods		57,524		82,648

	$	224,242	$	222,189


	October 3, 2021
	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total

	(in thousands)
Assets
Cash	$	577,752	$	—	$	—	$	577,752
Cash equivalents		176,703		324,999		—		501,702
Available-for-sale securities:
Commercial paper		—		179,629		—		179,629
U.S. Treasury securities		—		80,519		—		80,519
Corporate debt securities		—		58,648		—		58,648
Debt mutual funds		8,937		—		—		8,937
U.S. government agency securities		—		4,616		—		4,616
Certificates of deposit and time deposits		—		1,346		—		1,346
Non-U.S. government securities		—		590		—		590
Equity securities:
Mutual funds		35,776		—		—		35,776

	$	799,168	$	650,347	$	—	$	1,449,515
Derivative assets		—		93		—		93

Total	$	799,168	$	650,440	$	—	$	1,449,608

Liabilities
Derivative liabilities		—		433		—		433

Total	$	—	$	433	$	—	$	433


Reported as follows:
	(Level 1)		(Level 2)		(Level 3)		Total

	(in thousands)
Assets
Cash and cash equivalents	$	754,455	$	324,999	$	—	$	1,079,454
Marketable securities		—		233,397		—		233,397
Long-term marketable securities		44,713		91,951		—		136,664
Prepayments and other current assets		—		93		—		93

Total	$	799,168	$	650,440	$	—	$	1,449,608

Liabilities
Other current liabilities	$	—	$	433	$	—	$	433

Total	$	—	$	433	$	—	$	433


	October 3, 2021				December 31, 2020
	Carrying Value		Fair Value		Carrying Value		Fair Value

	(in thousands)
Assets
Cash and cash equivalents	$	1,079,454	$	1,079,454	$	914,121	$	914,121
Marketable securities		370,061		370,061		640,260		640,260
Derivative assets		93		93		95		95
Liabilities
Contingent consideration		—		—		7,227		7,227
Derivative liabilities		433		433		504		504
Convertible debt (1)		145,003		546,464		410,111		1,739,553


	October 3, 2021
	Available-for-Sale
	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value		Fair Market Value of Investments with Unrealized Losses

	(in thousands)
Commercial paper	$	179,624	$	5	$	—		$	179,629	$	20,799
U.S. Treasury securities		80,370		636		(487	)		80,519		17,336
Corporate debt securities		53,329		5,421		(102	)		58,648		22,010
Debt mutual funds		8,872		65		—			8,937		—
U.S. government agency securities		4,610		11		(5	)		4,616		3,302
Certificates of deposit and time deposits		1,346		—		—			1,346		—
Non-U.S. government securities		590		—		—			590		—

	$	328,741	$	6,138	$	(594	)	$	334,285	$	63,447


	Balance Sheet Location		October 3, 2021			December 31, 2020

			(in thousands)
Derivatives not designated as hedging instruments:
Foreign exchange contracts		Prepayments	$	93		$	95
Foreign exchange contracts		Other current liabilities		(433	)		(504	)

Total derivatives			$	(340	)	$	(409	)


	For the Three Months Ended				For the Nine Months Ended
	October 3, 2021		September 27, 2020		October 3, 2021		September 27, 2020

	(in thousands)
Contractual interest expense on the coupon	$	355	$	1,438	$	2,666	$	4,313
Amortization of the discount component and debt issue fees recognized as interest expense		2,424		3,887		9,771		11,518

Total interest expense on the convertible debt	$	2,779	$	5,325	$	12,437	$	15,831


	October 3, 2021
	Cost		Fair Market Value

	(in thousands)
Due within one year	$	233,327	$	233,397
Due after 1 year through 5 years		46,460		46,744
Due after 5 years through 10 years		6,120		6,586
Due after 10 years		33,962		38,621

Total	$	319,869	$	325,348


	Foreign Currency Translation Adjustment			Unrealized Gains (Losses) on Marketable Securities			Retirement Plans Prior Service Credit			Total

	(in thousands)
Nine Months Ended October 3, 2021
Balance at December 31, 2020, net of tax of $0, $1,910, $(1,126), respectively	$	25,389		$	6,954		$	1,173		$	33,516
Other comprehensive loss before reclassifications, net of tax of $0, $(516), $0, respectively		(26,672	)		(1,952	)		—			(28,624	)
Amounts reclassified from accumulated other comprehensive income, net of tax of $0, $(186), $(2), respectively		—			(670	)		(5	)		(675	)

Net current period other comprehensive loss, net of tax of $0 , $(702), $ (2), respectively		(26,672	)		(2,622	)		(5	)		(29,299	)

Balance at October 3, 2021, net of tax of $0, $1,208, $(1,128), respectively	$	(1,283	)	$	4,332		$	1,168		$	4,217


Nine Months Ended September 27, 2020
Balance at December 31, 2019, net of tax of $0, $946, $(1,124), respectively	$	(23,514	)	$	3,480		$	1,180		$	(18,854	)
Other comprehensive income before reclassifications, net of tax of $0, $1,410, $0, respectively		24,131			5,165			—			29,296
Amounts reclassified from accumulated other comprehensive income, net of tax of $0, $(615), $ (1 ), respectively		—			(2,188	)		(6	)		(2,194	)

Net current period other comprehensive income (loss), net of tax of $0, $795, $(1), respectively		24,131			2,977			(6	)		27,102

Balance at September 27, 2020, net of tax of $0, $1,741, $(1,125), respectively	$	617		$	6,457		$	1,174		$	8,248


Details about Accumulated Other Comprehensive Income Components	For the Three Months Ended				For the Nine Months Ended				Affected Line Item in the Statements of Operations
	October 3, 2021		September 27, 2020		October 3, 2021		September 27, 2020

	(in thousands)
Available-for-sale marketable securities:
Unrealized gains, net of tax of $65, $194, $186, $615, respectively	$	229	$	689	$	670	$	2,188		Other (income) expense, net
Defined benefit postretirement plan:
Amortization of prior service credit, net of tax of $0, $0, $2, $1, respectively		2		2		5		6		(a)

Total reclassifications, net of tax of $65, $194, $188, $616, respectively	$	231	$	691	$	675	$	2,194		Net income


	Industrial Automation			System Test			Wireless Test			Semiconductor Test			Total

	(in thousands)
Balance at December 31, 2020
Goodwill	$	433,752		$	158,699		$	361,819		$	262,155		$	1,216,425
Accumulated impairment losses		—			(148,183	)		(353,843	)		(260,540	)		(762,566	)

		433,752			10,516			7,976			1,615			453,859
Foreign currency translation adjustment		(20,373	)		—			—			(88	)		(20,461	)

Balance at October 3, 2021
Goodwill		413,379			158,699			361,819			262,067			1,195,964
Accumulated impairment losses		—			(148,183	)		(353,843	)		(260,540	)		(762,566	)

	$	413,379		$	10,516		$	7,976		$	1,527		$	433,398


	Gross Carrying Amount		Accumulated Amortization			Foreign Currency Translation Adjustment			Net Carrying Amount

Balance at October 3, 2021		(in thousands)

Developed technology	$	272,547	$	(220,147	)	$	(3,489	)	$	48,911
Customer relationships		57,739		(48,351	)		174			9,562
Tradenames and trademarks		70,120		(46,643	)		(273	)		23,204

Total intangible assets	$	400,406	$	(315,141	)	$	(3,588	)	$	81,677

Balance, December 31, 2020
Developed technology	$	272,547	$	(210,479	)	$	(1,610	)	$	60,458
Customer relationships		66,239		(54,524	)		305			12,020
Tradenames and trademarks		70,120		(42,344	)		685			28,461

Total intangible assets	$	408,906	$	(307,347	)	$	(620	)	$	100,939


Year	Amortization Expense
	(in thousands)
2021 (remainder)	$	5,199
2022		20,299
2023		19,815
2024		19,507
2025		11,645
Thereafter		5,212


	For the Three Months Ended
	October 3, 2021						September 27, 2020
	United States			Foreign			United States			Foreign

	(in thousands)
Service cost	$	452		$	240		$	417		$	216
Interest cost		1,098			86			1,460			123
Expected return on plan assets		(936	)		(17	)		(1,170	)		(16	)
Net actuarial loss		—			—			2,238			—
Settlement loss		—			—			450			—

Total net periodic pension cost	$	614		$	309		$	3,395		$	323


	For the Nine Months Ended
	October 3, 2021						September 27, 2020
	United States			Foreign			United States			Foreign
	(in thousands)
Service cost	$	1,357		$	720		$	1,283		$	648
Interest cost		3,295			257			4,505			369
Expected return on plan assets		(2,809	)		(50	)		(3,634	)		(47	)
Net actuarial (gain) loss		(400	)		—			2,418			—
Settlement loss		—			—			450			—

Total net periodic pension cost	$	1,443		$	927		$	5,022		$	970


	For the Three Months Ended						For the Nine Months Ended
	October 3, 2021			September 27, 2020			October 3, 2021			September 27, 2020

	(in thousands)
Service cost	$	16		$	14		$	48		$	43
Interest cost		43			60			128			180
Amortization of prior service credit		(2	)		(2	)		(7	)		(7	)
Net actuarial gain		—			—			(228	)		(279	)

Total net periodic postretirement benefit cost (credit)	$	57		$	72		$	(59	)	$	(63	)


	For the Three Months Ended						For the Nine Months Ended
	October 3, 2021			September 27, 2020			October 3, 2021			September 27, 2020


U.S. statutory federal tax rate		21.0	%		21.0	%		21.0	%		21.0	%
Foreign taxes		(4.4	)		(6.9	)		(4.4	)		(5.8	)
Tax credits		(1.9	)		(1.6	)		(1.4	)		(1.6	)
International provisions of the U.S. Tax Cuts and Jobs Act of 2017		(1.5	)		3.0			(1.6	)		0.5
Discrete benefit related to equity compensation		(0.1	)		(0.4	)		(1.6	)		(1.4	)
Other, net		0.7			0.5			0.7			0.6

Effective tax rate		13.8	%		15.6	%		12.7	%		13.3	%


	Semiconductor Test		System Test		Industrial Automation			Wireless Test		Corporate and Other			Consolidated

	(in thousands)

Three Months Ended October 3, 2021
Revenues	$	688,232	$	102,605	$	91,014		$	68,713	$	(63	)	$	950,501
Income (loss) before income taxes (1)(2)		265,017		31,773		(4,226	)		31,726		(26,535	)		297,755
Total assets (3)		1,251,549		147,970		696,792			119,568		1,546,303			3,762,182

Three Months Ended September 27, 2020
Revenues	$	592,141	$	118,169	$	68,711		$	40,504	$	(41	)	$	819,484
Income (loss) before income taxes (1)(2)		189,116		47,368		(5,302	)		10,938		21,611			263,731
Total assets (3)		1,069,830		155,642		667,132			108,671		1,435,237			3,436,512

Nine Months Ended October 3, 2021 (4)
Revenues	$	2,050,271	$	340,261	$	263,151		$	164,504	$	(352	)	$	2,817,835
Income (loss) before income taxes (1)(2)		778,687		116,788		(14,586	)		63,810		(38,925	)		905,774
Total assets (3)		1,251,549		147,970		696,792			119,568		1,546,303			3,762,182

Nine Months Ended September 27, 2020
Revenues	$	1,735,777	$	306,051	$	187,792		$	133,174	$	(294	)	$	2,362,500
Income (loss) before income taxes (1)(2)		571,719		114,968		(32,041	)		35,640		(12,197	)		678,089
Total assets (3)		1,069,830		155,642		667,132			108,671		1,435,237			3,436,512


	For the Three Months Ended						For the Nine Months Ended
	October 3,			September 27,			October 3,			September 27,
	2021			2020			2021			2020

Percentage of revenues:
Revenues:
Products		87	%		85	%		87	%		86	%
Services		13			15			13			14

Total revenues		100			100			100			100
Cost of revenues:
Cost of products		35			37			35			37
Cost of services		5			7			5			6

Total cost of revenues (exclusive of acquired intangible assets amortization shown separately below)		40			44			40			43

Gross profit		60			56			60			57
Operating expenses:
Selling and administrative		14			14			14			14
Engineering and development		11			12			11			12
Acquired intangible assets amortization		1			1			1			1
Restructuring and other		—			(3	)		—			—

Total operating expenses		26			23			26			27

Income from operations		34			33			34			29
Non-operating (income) expense:
Interest income		—			—			—			—
Interest expense		—			1			1			1
Other (income) expense, net		2			—			1			—

Income before income taxes		31			32			32			29
Income tax provision		4			5			4			4

Net income		27	%		27	%		28	%		25	%


Hypothetical Change in Teradyne Stock Price	Fair Value		Estimated change in fair value			Hypothetical percentage increase (decrease) in fair value

10% Increase	$	601,331	$	54,867			10.0	%
No Change		546,464		—			—
10% Decrease		491,600		(54,864	)		(10.0	)


Period	(a) Total Number of Shares (or Units) Purchased				(b) Average Price Paid per Share (or Unit)				(c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs		(d) Maximum Number (or Approximate Dollar Value) of Shares (or Units) that may Yet Be Purchased Under the Plans or Programs
July 5, 2021 - August 1, 2021		501			$	125.31				500	$	1,740,717
August 2, 2021 – August 29, 2021		545				121.08				545		1,674,719
August 30, 2021 – October 3, 2021		679				119.22				679		1,593,820

		1,725	(1	)	$	121.58	(1	)		1,724


Exhibit Number		Description

4.1		First Supplemental Indenture dated as of November 4, 2021 between Teradyne Inc. and Wilmington Trust, National Association, as trustee (filed herewith)

10.1		Deferral Plan for Non-Employee Directors, as amended (filed herewith)*

31.1		Certification of Principal Executive Officer, pursuant to Rule 13a-14(a) of Securities and Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)

31.2		Certification of Principal Financial Officer, pursuant to Rule 13a-14(a) of Securities and Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)

32.1		Certification of Principal Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)

32.2		Certification of Principal Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)

101.INS		XBRL Instance Document

101.SCH		XBRL Taxonomy Extension Schema Document

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		XBRL Taxonomy Extension Label Linkbase Document

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (formatted as Inline XBRL, and contained in Exhibit 101)