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TERADYNE, INC 8-K Report, Financial Results (Jan 31, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed January 31, 2024
Period End
January 30, 2024
Security
TER
In the record · 2016–202610-K1110-Q328-K91

TER filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 91 current reports (8-K) between 2016 and 2026.

  1. Leadership change8-K · Jun ’17Jun ’17
  2. Material agreement8-K · May ’20May ’20
  3. Leadership change8-K · Jun ’22Jun ’22
  4. Material agreement8-K · Aug ’26Aug ’26

01—Abstract

Summary

Summary of the 8-K filed January 31, 2024. Cited figures are marked; the original filing is the authoritative source.

Teradyne (NASDAQ: TER) reported fourth-quarter 2023 revenue of $671 milliona, down 8% from $732 million a year earlier and roughly flat with the $704 million reported in Q3 2023.

GAAP diluted EPS was $0.72b and non-GAAP diluted EPS was $0.79, compared with $1.04 and $0.92 in Q4 2022. Full-year 2023 revenue fell 15% to $2,676 million from $3,155 million, and GAAP diluted EPS dropped to $2.73 from $4.22. Growth was concentrated in Robotics, which set a quarterly record with $129 million of revenue, up 50% sequentially and 17% year over year, while Semiconductor Test ($431 million) benefited from strong memory test demand offset by weakness in System-on-a-Chip test systems.

Management said Q4 results were in line with guidance. The outlook is cautious for the near term. Management expects low tester utilization to weigh on Semiconductor Test demand in the first half of 2024, though it anticipates full-year semiconductor test demand to improve incrementally from 2023.

Robotics is expected to show seasonal weakness in Q1 before resuming consistent quarterly growth. First-quarter 2024 guidance calls for revenue of $540 million to $590 millionc, GAAP diluted EPS of $0.19 to $0.35, and non-GAAP diluted EPS of $0.22 to $0.38, which implies a meaningful sequential decline from Q4 2023. Balance sheet and capital return metrics remained solid.

Cash and cash equivalents were $758 milliond at year-end, with total marketable securities of about $180 million, and no current debt remained after $50 million of convertible debt principal was repaid during 2023. Full-year operating cash flow was $585 million.

The company repurchased $397 million of common stock in 2023, down from $752 million in 2022, and paid $0.11 per quarter in dividends. Investors should weigh the Robotics growth and balance sheet strength against a soft first-half 2024 outlook and continued pressure on the semiconductor test business.

02—Key points

Key Highlights

  1. Q4 2023 revenue of $671 million was down 8% year over year but in line with company guidance; GAAP diluted EPS was $0.72 and non-GAAP diluted EPS was $0.79.
  2. FY 2023 revenue fell 15% to $2,676 million, and GAAP diluted EPS declined 35% to $2.73 from $4.22, with full-year operating margin compressing to 18.7% from 26.4%.
  3. Robotics posted record quarterly revenue of $129 million, up 50% sequentially and 17% year over year, a key bright spot in the portfolio.
  4. Semiconductor Test generated $431 million in Q4, supported by strong memory test demand, which offset weaker System-on-a-Chip test system demand.
  5. Q1 2024 guidance of $540 million to $590 million in revenue and non-GAAP diluted EPS of $0.22 to $0.38 signals a sequential decline, with management citing low tester utilization in the first half.
  6. Management expects full-year 2024 semiconductor test demand to improve incrementally from 2023, while Robotics is projected to grow consistently each quarter after a seasonal Q1 dip.
  7. The company ended 2023 with $758 million in cash and equivalents, no current debt, and $585 million in operating cash flow, while returning capital through $397 million in buybacks and $0.44 per share in annual dividends.

03—Questions

Frequently Asked Questions

  1. Did Teradyne meet its Q4 2023 expectations?

    Yes. Management said Q4 revenue and profit were in line with guidance. Revenue of $671 million came in slightly below Q3 2023's $704 million but was supported by memory test strength and a 50% sequential jump in Robotics.

  2. What is the outlook for Teradyne in the first half of 2024?

    The outlook is soft. First-quarter 2024 revenue guidance of $540 million to $590 million is below Q4 2023 levels, and management expects low tester utilization to weigh on semiconductor test demand through the first half. Robotics is expected to see seasonal weakness in Q1 before growing consistently.

  3. Why did Teradyne's earnings decline so much in 2023?

    Full-year revenue fell 15% to $2,676 million, and operating margin declined to 18.7% from 26.4%, which reduced GAAP diluted EPS to $2.73 from $4.22. The decline reflected weaker demand in System-on-a-Chip test and lower overall volume, partially offset by memory test and Robotics growth.

  4. Is Teradyne's balance sheet strong enough to support its capital returns?

    Yes. The company ended 2023 with $758 million in cash and equivalents, about $180 million in marketable securities, and no current debt. It generated $585 million in operating cash flow, repurchased $397 million of stock, and paid $0.44 per share in dividends during the year.

  5. What is driving growth in Teradyne's Robotics business?

    Management attributes Robotics growth to new products, new applications, and improvements in its global distribution channels. Q4 2023 Robotics revenue of $129 million was a quarterly record, up 17% from Q4 2022.

04—Continue

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