Teradyne Reports Third Quarter 2022 Results

• Revenue and earnings above the mid-point of Q3 steering
• Test income declined 14% from Q3’21, incrementally stronger than July steering on improved provide chain efficiency
• Industrial Automation income declined 2% from Q3’21 in greenback phrases, grew 7% in fixed forex

NORTH READING, Mass., Oct. 25, 2022 (GLOBE NEWSWIRE) — Teradyne, Inc. (NASDAQ: TER) reported income of $827 million for the third quarter of 2022 of which $576 million was in Semiconductor Test, $116 million in System Test, $46 million in Wireless Test and $89 million in Industrial Automation (IA). GAAP internet revenue for the third quarter was $183.5 million or $1.10 per diluted share. On a non-GAAP foundation, Teradyne’s internet revenue within the third quarter was $189.2 million, or $1.15 per diluted share, which excluded acquired intangible asset amortization and restructuring and different costs.

“We delivered revenue and earnings above the mid-point of our July outlook as some supply line constraints eased through the quarter enabling greater than expected shipments to memory, automotive and industrial semiconductor test customers,” stated Teradyne CEO Mark Jagiela. “The short-term outlook in semiconductor test remains mixed with automotive and industrial demand relatively strong while muted compute and mobility demand persists. In industrial automation, slowing manufacturing activity and foreign exchange headwinds continue to impact our full year growth outlook.”

Guidance for the fourth quarter of 2022 is income of $670 million to $750 million, with GAAP internet revenue of $0.59 to $0.84 per diluted share and non-GAAP internet revenue of $0.62 to $0.86 per diluted share. Non-GAAP steering excludes acquired intangible asset amortization.

Webcast
A convention name to debate the third quarter outcomes, together with administration’s business outlook, will comply with at 8:30 a.m. ET, Wednesday, October 26. Interested traders ought to entry the webcast at www.teradyne.com and click on on “Investors” not less than 5 minutes earlier than the decision begins. Presentation supplies shall be out there beginning at 8:30 a.m. ET. A replay shall be out there on the Teradyne web site at https://investors.teradyne.com/events-presentations.

Non-GAAP Results
In addition to disclosing outcomes which are decided in accordance with GAAP, Teradyne additionally discloses non-GAAP outcomes of operations that exclude sure revenue objects and costs and discloses sure income at fixed forex. These outcomes are offered as a complement to outcomes offered in accordance with GAAP. Non-GAAP revenue from operations and non-GAAP internet revenue exclude acquired intangible belongings amortization, restructuring and different, pension actuarial good points and losses, losses on convertible debt conversions, non-cash convertible debt curiosity, discrete revenue tax changes, and contains the associated tax impression on non-GAAP changes. GAAP requires that this stuff be included in figuring out revenue from operations and internet revenue. Non-GAAP revenue from operations, non-GAAP internet revenue, non-GAAP revenue from operations as a share of income, non-GAAP internet revenue as a share of income, and non-GAAP internet revenue per share are non-GAAP efficiency measures offered to supply significant supplemental info concerning Teradyne’s baseline efficiency earlier than good points, losses or different costs that is probably not indicative of Teradyne’s present core business or future outlook. Constant forex income excludes the impression of modifications in international forex change charges, that are required by GAAP. These non-GAAP efficiency measures are used to make operational choices, to find out worker compensation, to forecast future operational outcomes, and for comparability with Teradyne’s business plan, historic working outcomes and the working outcomes of Teradyne’s rivals. Non-GAAP diluted shares embrace the impression of Teradyne’s name choice on its shares. Management believes every of those non-GAAP efficiency measures supplies helpful supplemental info for traders, permitting higher transparency to the knowledge utilized by administration in its operational resolution making and within the overview of Teradyne’s monetary and operational efficiency, in addition to facilitating significant comparisons of Teradyne’s leads to the present interval in contrast with these in prior and future intervals. A reconciliation of every out there GAAP to non-GAAP monetary measure mentioned on this press launch is contained within the hooked up displays and on the Teradyne web site at www.teradyne.com by clicking on “Investor Relations” after which deciding on “Financials” and the “GAAP to Non-GAAP Reconciliation” hyperlink. The non-GAAP efficiency measures mentioned on this press launch is probably not similar to equally titled measures utilized by different corporations. The presentation of non-GAAP measures shouldn’t be meant to be thought-about in isolation, as an alternative choice to, or superior to, monetary measures or info offered in accordance with GAAP.

About Teradyne
Teradyne (NASDAQ:TER) brings high-quality improvements resembling sensible units, life-saving medical gear and knowledge storage methods to market, quicker. Its superior check options for semiconductors, digital methods, wi-fi units and extra be sure that merchandise carry out as they have been designed. Its Industrial Automation choices embrace collaborative and cell robots that assist producers of all sizes enhance productiveness and decrease prices. In 2021, Teradyne had income of $3.7 billion and immediately employs over 6,500 individuals worldwide. For extra info, go to teradyne.com. Teradyne^® is a registered trademark of Teradyne, Inc. within the U.S. and different international locations.

Safe Harbor Statement
This launch accommodates forward-looking statements concerning Teradyne’s future business prospects, the impression of the worldwide pandemic of the novel pressure of the coronavirus (COVID-19), outcomes of operations, market situations, earnings per share, the impression of provide chain situations on the business, buyer gross sales expectations, the fee of a quarterly dividend, the repurchase of Teradyne frequent inventory pursuant to a share repurchase program, sanctions towards Russia and Russian corporations, and the impression of U.S. and Chinese export and tariff legal guidelines, together with new rules printed by the U.S. Department of Commerce on October 7, 2022. Such statements are primarily based on the present assumptions and expectations of Teradyne’s administration and are neither guarantees nor ensures of future efficiency, occasions, buyer gross sales, provide chain situations or enhancements, earnings per share, use of money, fee of dividends, repurchases of frequent inventory, fee of the senior convertible notes, the impression of the COVID-19 pandemic, sanctions towards Russia and Russian corporations, the impression of any tariffs or export controls imposed by the U.S. or China, compliance with commerce safety measures or export restrictions, the impression of U.S. Department of Commerce or different authorities company rules regarding Huawei, HiSilicon and different clients or potential clients, the impression of U.S. Department Commerce export management rules for sure U.S. merchandise and expertise bought to army finish customers or for army end-use in China, Russia and Venezuela, or the impression of rules printed by the U.S. Department of Commerce regarding the export of semiconductors and semiconductor manufacturing gear destined to sure finish customers and for sure finish makes use of in China. There will be no assurance that administration’s estimates of Teradyne’s future outcomes or different forward-looking statements shall be achieved. Specifically, Teradyne’s 2024 earnings mannequin is aspirational and contains many assumptions. There will be no assurance that these assumptions shall be correct or that mannequin outcomes shall be achieved. As set forth beneath, there are numerous components that would trigger our 2024 earnings mannequin and precise outcomes to vary materially from these presently anticipated. Additionally, the present dividend and share repurchase packages could also be modified, suspended or discontinued at any time.

On October 7, 2022, the U.S. Department of Commerce printed new rules limiting the export to China of superior semiconductors, supercomputer expertise, gear for the manufacturing of superior semiconductors and parts and expertise for the manufacturing in China of sure semiconductor manufacturing gear. The new restrictions are prolonged and sophisticated. Teradyne continues to evaluate the impression of those rules on its business. At this time, the Company has decided that restrictions on the sale of semiconductor testers in China to check sure superior semiconductors will impression Teradyne’s gross sales to sure corporations in China. Several multinational corporations manufacturing these superior semiconductors in China have obtained one-year licenses permitting suppliers resembling Teradyne to proceed to supply testers to the services operated by these corporations. We count on that different corporations manufacturing superior semiconductors in China is not going to obtain licenses, thereby limiting Teradyne’s capacity to supply testers to the services operated by these corporations that don’t obtain a license. The Company is also assessing the submitting of license requests to promote to and assist sure clients in China for sure finish makes use of that, if granted, might cut back the impression of those restrictions on the Company’s business. At this time, Teradyne doesn’t know the impression these finish person and finish use restrictions may have on its business in China or on future revenues. In addition to the particular restrictions impacting Teradyne’s business, the rules might have an opposed impression on sure precise or potential clients and on the worldwide semiconductor trade. To the extent the rules impression precise and potential clients or disrupt the worldwide semiconductor trade, Teradyne’s business and revenues shall be adversely impacted.

The Company additionally has decided that the restrictions on the export of sure US origin parts and expertise to be used within the improvement and manufacturing in China of sure semiconductor manufacturing gear impression its manufacturing and improvement operations in China. Teradyne has obtained a brief authorization from the Department of Commerce permitting the Company to proceed its manufacturing and improvement operations in China till the Department of Commerce points a license to switch this momentary authorization. Teradyne will file an utility with the Department of Commerce for a license to switch the momentary authorization by November 17, 2022. The Company can not assess the chance or timing of receiving this license. In addition to requesting a license, the Company is implementing procedures for minimizing the impression of those new rules, however there isn’t a assurance that these procedures will succeed.

Following Russia’s invasion of Ukraine in February 2022, the U.S. and different international locations imposed vital sanctions towards the Russian authorities and lots of Russian corporations and people. Although Teradyne doesn’t have vital operations in Russia, the sanctions may impression Teradyne’s business in different international locations and will have a unfavourable impression on the Company’s provide chain, both of which may adversely have an effect on Teradyne’s business and monetary outcomes.

COVID-19 has resulted in authorities implementing quite a few measures to attempt to comprise the virus, resembling journey bans and restrictions, quarantines, authorities vaccination mandates and different authorities rules. These measures have impacted and will additional impression Teradyne’s workforce and operations, the operations of its clients, and people of its contract producers and suppliers. As Teradyne implements measures to adjust to further rules, the Company might expertise elevated compliance prices, elevated danger of non-compliance and elevated danger of worker attrition.

The COVID-19 pandemic has adversely impacted the Company’s outcomes of operations, together with elevated prices company-wide and constraints throughout the Company’s provide chain. The Company can not precisely estimate the quantity of the impression on Teradyne’s 2022 monetary outcomes and to its future monetary outcomes. The COVID-19 outbreak has considerably elevated financial and demand uncertainty in Teradyne’s markets. This uncertainty resulted in a big lower in demand for sure Teradyne merchandise and will proceed to impression demand for an unsure time period. The unfold of COVID-19 has triggered Teradyne to change its business practices (together with worker journey, workers working remotely, and cancellation of in individual participation in conferences, occasions and conferences) and the Company might take additional actions as could also be required by authorities authorities or that it determines are in one of the best pursuits of its workers, clients, contract producers and suppliers. There is uncertainty that such measures shall be adequate to mitigate the dangers posed by the virus, and Teradyne’s capacity to carry out vital features may very well be impacted. The diploma to which COVID-19 continues to impression Teradyne’s outcomes will rely on future developments, that are extremely unsure and can’t be predicted, together with, however not restricted to, the length and continued unfold of the virus, its severity, the actions to comprise the virus or the supply and impression of vaccines in international locations the place the Company does business, and the way shortly and to what extent regular financial and working situations can resume.

Important components that would trigger precise outcomes, the 2024 earnings mannequin, earnings per share, use of money, dividend funds, repurchases of frequent inventory, or fee of the senior convertible notes to vary materially from these presently anticipated embrace: situations affecting the markets wherein Teradyne operates; decreased or delayed product demand from a number of vital clients; improvement, supply and acceptance of recent merchandise; the power to develop the Industrial Automation business; elevated analysis and improvement spending; deterioration of Teradyne’s monetary situation; the continued impression of the COVID-19 pandemic and associated authorities responses in the marketplace and demand for Teradyne’s merchandise, on its contract producers and provide chain, and on its workforce; the impression of the worldwide semiconductor provide scarcity on our provide chain and contract producers; the consummation and success of any mergers or acquisitions; demand for merchandise by the Company’s largest clients; sudden money wants; inadequate money move to make required funds and pay the principal quantity on the senior convertible notes; the business judgment of the board of administrators {that a} declaration of a dividend or the repurchase of frequent inventory shouldn’t be within the Company’s greatest pursuits; further U.S. tax rules or IRS steering; the impression of any tariffs or export controls imposed by the U.S. or China; compliance with commerce safety measures or export restrictions; the impression of U.S. Department of Commerce or different authorities company rules regarding Huawei, HiSilicon and different clients or potential clients; the impression of U.S. Department Commerce export management rules for sure U.S. merchandise and expertise bought to army finish customers or for army end-use in China, Russia and Venezuela; sanctions imposed towards the Russian authorities and sure Russian corporations and people by the U.S., and different international locations; the impression of rules printed by the U.S. Department of Commerce regarding semiconductors and semiconductor manufacturing gear destined for sure finish makes use of in China; and different occasions, components and dangers disclosed in filings with the SEC, together with, however not restricted to, the “Risk Factors” sections of Teradyne’s Annual Report on Form 10-Ok for the fiscal 12 months ended December 31, 2021 and Quarterly Report on Form 10-Q for the fiscal quarter ended July 3, 2022. The forward-looking statements offered by Teradyne on this press launch characterize administration’s views as of the date of this launch. Teradyne anticipates that subsequent occasions and developments might trigger administration’s views to alter. However, whereas Teradyne might elect to replace these forward-looking statements in some unspecified time in the future sooner or later, Teradyne particularly disclaims any obligation to take action. These forward-looking statements shouldn’t be relied upon as representing Teradyne’s views as of any date subsequent to the date of this launch.