10-KPeriod: FY2014

TERADYNE, INC Annual Report, Year Ended Dec 31, 2014

Filed February 27, 2015For Securities:TER

Summary

Teradyne, Inc.'s 2014 Form 10-K filing reveals a company navigating shifts in its core markets. While Semiconductor Test revenue saw a significant increase of 27% in 2014, driven by demand in application processors, the Wireless Test segment experienced a substantial 27% decline, largely due to lower cellular and connectivity product volumes. This decline in Wireless Test led to a goodwill impairment charge of $98.9 million, highlighting strategic challenges within that segment. The company's overall revenue grew by 15% to $1.65 billion in 2014, supported by the strong performance in Semiconductor Test. However, gross profit margin decreased by 3.3 percentage points due to an unfavorable product mix in Semiconductor Test and lower Wireless Test sales. Despite revenue growth, the company's income from operations was significantly impacted by the goodwill impairment and increased pension expenses. Teradyne also initiated a quarterly dividend in 2014 and announced a substantial $500 million stock repurchase program in early 2015, signaling a focus on returning capital to shareholders.

Financial Highlights

52 data points
Beta

Revenue

$1.65B

53.3% Gross Margin

Net Income

$81.27M

4.9% Net Margin

EPS (Diluted)

$0.37

Total Assets

$2.54B

Cash & Equivalents

$294.26M

Free Cash Flow

$323.08M

Financial Statements
Beta
Revenue$1.65B
Cost of Revenue$769.02M
Gross Profit$878.81M
SG&A Expenses$319.71M
Operating Expenses$782.38M
Operating Income$96.42M
Interest Expense$6.93M
Net Income$81.27M
EPS (Basic)$0.40
EPS (Diluted)$0.37
Shares Outstanding (Basic)202.91M
Shares Outstanding (Diluted)222.55M

Key Highlights

  • 1Semiconductor Test revenue increased by 27% to $1.30 billion in 2014, driven by strong demand in the application processor market.
  • 2Wireless Test revenue decreased by 27% to $184.5 million in 2014, impacting overall segment performance.
  • 3The company recorded a significant goodwill impairment charge of $98.9 million in the Wireless Test segment due to decreased projected demand.
  • 4Total revenues for 2014 reached $1.65 billion, an increase of 15% compared to 2013.
  • 5Gross profit margin decreased to 53.3% in 2014 from 56.6% in 2013, influenced by product mix and lower Wireless Test sales.
  • 6Teradyne initiated a quarterly dividend of $0.06 per share in 2014.
  • 7A new $500 million stock repurchase program was authorized in January 2015.

Frequently Asked Questions

Teradyne's revenue growth in 2014 was primarily driven by a significant increase in its Semiconductor Test segment, which saw a 27% rise in revenue due to strong demand in the application processor test market.

Teradyne incurred a $98.9 million goodwill impairment charge in its Wireless Test segment. This was a result of decreased projected demand in that market, attributed to factors such as the reuse of wireless test equipment, price competition, and evolving testing techniques.

Teradyne's gross profit margin decreased to 53.3% in 2014, down from 56.6% in 2013. This was primarily due to an unfavorable product mix within the Semiconductor Test segment and lower sales in the Wireless Test segment.

In 2014, Teradyne initiated a quarterly cash dividend of $0.06 per share. Furthermore, in January 2015, the company authorized a substantial $500 million stock repurchase program, indicating a commitment to returning capital to its shareholders.