10-QPeriod: Q1 FY2024

TERADYNE, INC Quarterly Report for Q1 Ended Mar 31, 2024

Filed May 3, 2024For Securities:TER

Summary

Teradyne, Inc. reported total revenues of $599.8 million for the first quarter of 2024, a decrease of 2.9% compared to $617.5 million in the prior year period. This decline was primarily driven by a significant drop in Wireless Test revenues, down 36.4%, and a slight decrease in Semiconductor Test revenues. The company's net income for the quarter was $64.2 million, or $0.40 per diluted share, compared to $83.5 million, or $0.50 per diluted share, in the first quarter of 2023. This performance reflects a challenging market environment, particularly in the mobility sector, although artificial intelligence applications provided a boost to Semiconductor Test performance. Despite the revenue dip, Teradyne maintained a strong gross profit margin of 56.6%. The company is actively managing its operating expenses, with a slight decrease in Selling and Administrative and Engineering and Development costs. Teradyne is also progressing with its strategic partnership with Technoprobe S.p.A., with the transaction expected to close in the second quarter of 2024. The company continues to return capital to shareholders through dividends and share repurchases, demonstrating a commitment to shareholder value while navigating market fluctuations.

Financial Highlights

53 data points
Beta

Revenue

$599.82M

56.6% Gross Margin

Net Income

$64.20M

10.7% Net Margin

EPS (Diluted)

$0.40

Total Assets

$3.41B

Cash & Equivalents

$707.40M

Free Cash Flow

-$36.74M

Financial Statements
Beta
Revenue$599.82M
Cost of Revenue$260.54M
Gross Profit$339.28M
SG&A Expenses$149.19M
Operating Expenses$261.51M
Operating Income$77.77M
Interest Expense$661K
Net Income$64.20M
EPS (Basic)$0.42
EPS (Diluted)$0.40
Shares Outstanding (Basic)153.05M
Shares Outstanding (Diluted)162.35M

Key Highlights

  • 1Total revenues decreased by 2.9% year-over-year to $599.8 million in Q1 2024.
  • 2Net income decreased to $64.2 million ($0.40/share) in Q1 2024 from $83.5 million ($0.50/share) in Q1 2023.
  • 3Wireless Test revenue saw a significant decline of 36.4% compared to the prior year period.
  • 4Semiconductor Test revenue showed resilience, driven by AI applications, offsetting weakness in mobility.
  • 5Gross profit margin remained strong at 56.6%, although down slightly from 57.7% in the prior year.
  • 6The company repurchased $22.1 million of common stock in Q1 2024 and paid $18.4 million in dividends.
  • 7The strategic partnership and acquisition of a 10% equity investment in Technoprobe is on track for closing in Q2 2024.

Frequently Asked Questions

Teradyne's total revenues decreased by 2.9% to $599.8 million in the first quarter of 2024 compared to the same period in 2023. The primary drivers for this decline were a significant decrease of 36.4% in Wireless Test revenues and a slight decrease in Semiconductor Test revenues, though this was partially offset by AI-driven demand in Memory Test. The mobility test market also continues to experience weak demand.

Teradyne demonstrated effective cost management. Selling and administrative expenses decreased slightly by $1.8 million, and engineering and development expenses decreased by $2.6 million, primarily due to lower spending in the Robotics segment and Semiconductor Test, respectively. The company also recorded $4.2 million in restructuring and other charges, including acquisition and divestiture costs related to the Technoprobe transaction and severance charges.

Teradyne announced a strategic partnership with Technoprobe S.p.A. on November 7, 2023, which includes Teradyne investing 481.0 million Euros for a 10% equity stake and Technoprobe acquiring Teradyne's Device Interface Solutions (DIS) business for $85.0 million. This transaction is expected to close in the second quarter of 2024, subject to regulatory approvals.

Teradyne continued its commitment to returning capital to shareholders in the first quarter of 2024. The company repurchased approximately $22.1 million of its common stock and declared a quarterly cash dividend of $0.12 per share, resulting in $18.4 million in dividend payments. The company intends to repurchase up to $90.0 million of its common stock in 2024, subject to market conditions.