TERADYNE, INC Quarterly Report for Q3 Ended Jul 3, 2022

Summary

Teradyne, Inc. reported revenues of $840.8 million for the second quarter of 2022, a decrease of 22.1% compared to the same period in 2021, largely driven by a significant decline in its Semiconductor Test segment. Despite the revenue drop, gross profit margin remained strong at 60.2%, a slight increase from the prior year's 59.6%, attributed to a favorable product mix. However, operating expenses increased as a percentage of revenue, impacting net income, which fell to $197.8 million from $328.3 million year-over-year. The company cited ongoing supply chain constraints, particularly impacting its test businesses, as a key factor for projected revenue shortfalls in the next quarter. Teradyne continued its capital allocation strategies, repurchasing $532.8 million of its stock and paying dividends. The company maintains a solid balance sheet with $572.0 million in cash and cash equivalents and $321.8 million in marketable securities, and has undrawn credit facilities available.

Key Highlights

• 1Total revenues for Q2 2022 decreased by 22.1% to $840.8 million compared to $1,085.7 million in Q2 2021.
• 2Semiconductor Test revenue significantly declined by 35.1% ($292.7 million) due to lower tester sales in high-performance compute processor and mobile applications.
• 3Gross profit margin improved slightly to 60.2% from 59.6% in the prior year, driven by a favorable product mix.
• 4Net income for Q2 2022 was $197.8 million ($1.16 per diluted share), down from $328.3 million ($1.76 per diluted share) in Q2 2021.
• 5The company experienced significant share repurchases totaling $532.8 million in the first six months of 2022.
• 6Supply chain constraints are projected to impact Q3 2022 revenue by approximately $50 million, primarily in test businesses.
• 7Cash and cash equivalents decreased to $572.0 million at July 3, 2022, from $1,122.2 million at December 31, 2021.

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