TERADYNE, INC Quarterly Report for Q3 Ended Jul 3, 2011

Summary

Teradyne, Inc. reported its second quarter 2011 results, showing a year-over-year decrease in total net revenues to $410.5 million from $445.3 million, primarily driven by a decline in the Semiconductor Test segment. Despite the revenue dip, the company's net income remained strong at $89.1 million ($0.39 per diluted share) for the quarter. The Systems Test Group segment saw significant growth, more than doubling its revenue, largely due to increased sales of Hard Disk Drive test systems. The company ended the quarter with a robust liquidity position, with cash, cash equivalents, and marketable securities totaling $1.2 billion. Operating activities generated $121.6 million in cash for the six-month period, demonstrating effective cash flow management. Teradyne continues to invest in engineering and development, though expenses decreased slightly year-over-year. The company also provided an update on its restructuring activities, which are nearing completion.

Key Highlights

• 1Total net revenues decreased by 7.9% year-over-year to $410.5 million for Q2 2011.
• 2Semiconductor Test segment revenue declined by 17% to $343.1 million.
• 3Systems Test Group revenue more than doubled, increasing by 109% to $67.4 million.
• 4Net income for the quarter was $89.1 million, translating to $0.39 in diluted earnings per share.
• 5The company maintained a strong liquidity position with $1.2 billion in cash, cash equivalents, and marketable securities as of July 3, 2011.
• 6The book-to-bill ratio for the total company was 0.8 in Q2 2011, down from 1.1 in Q2 2010, indicating slower order intake relative to sales.
• 7The company sold its Diagnostic Solutions business on March 21, 2011, with results classified as discontinued operations.

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