0000950170-24-009126 8-K 13 20240130 2.02 9.01 20240131 20240131 TERADYNE, INC 0000097210 3825 08 Industrial Applications and Services 042272148 MA 1231 8-K 34 001-06462 24580479 600 RIVERPARK DRIVE NORTH READING MA 01864 978-370-2700 600 RIVERPARK DRIVE NORTH READING MA 01864 TERADYNE INC 19920703 8-K 1 ter-20240130.htm 8-K 0000097210false00000972102024-01-302024-01-30 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of report (Date of earliest event reported): January 30, 2024 TERADYNE, INC. (Exact Name of Registrant as Specified in Charter) Massachusetts 001-06462 04-2272148 (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 600 Riverpark Drive, North Reading, MA 01864 (Address of Principal Executive Offices) (Zip Code) Registrant’s telephone number, including area code: (978) 370-2700 (Former Name or Former Address, if Changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): ? Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) ? Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) ? Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) ? Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) Securities registered pursuant to Section 12(b) of the Act: Trading Name of each exchange Title of each class Symbol(s) on which registered Common Stock, par value $0.125 per share TER Nasdaq Stock Market LLC Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ? If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ? -------------------------------------------------------------------------------- Item 2.02 Results of Operations and Financial Condition. On January 30, 2024, Teradyne, Inc. (“Teradyne”) issued a press release regarding its financial results for the fourth quarter ended December 31, 2023. Teradyne’s press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K. Item 9.01 Financial Statements and Exhibits. (d) Exhibits. Exhibit Description 99.1 Press Release dated January 30, 2024. 104 Cover Page Interactive Data File (embedded within the Inline XBRL document) -------------------------------------------------------------------------------- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. TERADYNE, INC. Dated: January By: 31, 2024 /s/ SANJAY MEHTA Name: Sanjay Mehta Vice President, Chief Financial Title: Officer and Treasurer -------------------------------------------------------------------------------- EX-99.1 2 ter-ex99_1.htm EX-99.1 Exhibit 99.1 Teradyne Reports Fourth Quarter and Fiscal Year 2023 Results • Revenue of $671 million in Q4'23, down 8% from Q4'22 • Revenue of $2,676 million in FY 2023, down 15% from FY 2022 • Record Robotics revenue in Q4'23, up 50% from Q3'23 and 17% from Q4'22 Q4'23 Q4'22 Q3'23 FY 2023 FY 2022 Revenue (mil) $ 671 $ 732 $ 704 $ 2,676 $ 3,155 GAAP EPS $ 0.72 $ 1.04 $ 0.78 $ 2.73 $ 4.22 Non-GAAP EPS $ 0.79 $ 0.92 $ 0.80 $ 2.93 $ 4.25 NORTH READING, Mass. – January 30, 2024 – Teradyne, Inc. (NASDAQ: TER) reported revenue of $671 million for the fourth quarter of 2023 of which $431 million was in Semiconductor Test, $86 million in System Test, $25 million in Wireless Test and $129 million in Robotics. GAAP net income for the fourth quarter was $117 million or $0.72 per diluted share. On a non-GAAP basis, Teradyne’s net income in the fourth quarter was $127 million, or $0.79 per diluted share, which excluded pension actuarial losses, acquired intangible asset amortization, restructuring and other charges, and included the related tax impact on non-GAAP adjustments. “We closed out 2023 with Q4 revenue and profit in line with our guidance as strong demand for memory test systems and 50% quarterly growth of Robotics revenue offset weakening demand for System-on-a-Chip (SOC) test systems,” said Teradyne CEO Greg Smith. “Looking into the new year, we expect low tester utilization will impact demand in the first half of the year but anticipate the full year Semiconductor test demand to incrementally improve from 2023. In Robotics, after expected seasonal weakness in Q1, we project consistent quarterly growth powered by new products, new applications and improvements in our global distribution channels.” Guidance for the first quarter of 2024 is revenue of $540 million to $590 million, with GAAP net income of $0.19 to $0.35 per diluted share and non-GAAP net income of $0.22 to $0.38 per diluted share. Non-GAAP guidance excludes acquired intangible asset amortization and includes the related tax impact on non-GAAP adjustments. Webcast A conference call to discuss the fourth quarter results, along with management’s business outlook, will follow at 8:30 a.m. ET, Wednesday, January 31, 2024. Interested investors should access the webcast at www.teradyne.com and click on "Investors" at least five minutes before the call begins. Presentation materials will be available starting at 8:30 a.m. ET. A replay will be available on the Teradyne website at www.teradyne.com/investors. -------------------------------------------------------------------------------- Page 2 Non-GAAP Results In addition to disclosing results that are determined in accordance with GAAP, Teradyne also discloses non-GAAP results of operations that exclude certain income items and charges. These results are provided as a complement to results provided in accordance with GAAP. Non-GAAP income from operations and non-GAAP net income exclude acquired intangible assets amortization, restructuring and other, pension actuarial gains and losses, stock compensation modification expense, discrete income tax adjustments, and includes the related tax impact on non-GAAP adjustments. GAAP requires that these items be included in determining income from operations and net income. Non-GAAP income from operations, non-GAAP net income, non-GAAP income from operations as a percentage of revenue, non-GAAP net income as a percentage of revenue, and non-GAAP net income per share are non-GAAP performance measures presented to provide meaningful supplemental information regarding Teradyne’s baseline performance before gains, losses or other charges that may not be indicative of Teradyne’s current core business or future outlook. These non-GAAP performance measures are used to make operational decisions, to determine employee compensation, to forecast future operational results, and for comparison with Teradyne’s business plan, historical operating results and the operating results of Teradyne’s competitors. Non-GAAP diluted shares include the impact of Teradyne’s call option on its shares. Management believes each of these non-GAAP performance measures provides useful supplemental information for investors, allowing greater transparency to the information used by management in its operational decision making and in the review of Teradyne’s financial and operational performance, as well as facilitating meaningful comparisons of Teradyne’s results in the current period compared with those in prior and future periods. A reconciliation of each available GAAP to non-GAAP financial measure discussed in this press release is contained in the attached exhibits and on the Teradyne website at www.teradyne.com by clicking on “Investor Relations” and then selecting “Financials” and the “GAAP to Non-GAAP Reconciliation” link. The non-GAAP performance measures discussed in this press release may not be comparable to similarly titled measures used by other companies. The presentation of non-GAAP measures is not meant to be considered in isolation, as a substitute for, or superior to, financial measures or information provided in accordance with GAAP. About Teradyne Teradyne (NASDAQ:TER) test technology helps bring high-quality innovations such as smart devices, life-saving medical equipment and data storage systems to market, faster. Its advanced test solutions for semiconductors, electronic systems, wireless devices and more ensure that products perform as they were designed. Its robotics offerings include collaborative and mobile robots that help manufacturers of all sizes increase productivity, improve safety, and lower costs. In 2023, Teradyne had revenue of $2.7 billion and today employs over 6,500 people worldwide. For more information, visit teradyne.com. Teradyne® is a registered trademark of Teradyne, Inc., in the U.S. and other countries. Safe Harbor Statement This release contains forward-looking statements including statements regarding Teradyne’s future business prospects, financial performance or position and results of operations. You can identify forward-looking statements by their use of forward-looking words such as “anticipate,” “expect,” “plan,” “could,” “may,” “will,” “believe,” “estimate,” “goal” or other comparable terms. Forward-looking statements in this press release address various matters, including statements regarding Teradyne’s financial guidance. Investors are cautioned that such forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements due to known and unknown risks, uncertainties, assumptions, and other factors. Such factors include, but are not limited to, macroeconomic factors and slowdowns or downturns in economic conditions generally and in the markets in which Teradyne operates; decreased or delayed product demand from one or more significant customers; a slowdown or inability in the development, delivery and acceptance of new products; the ability to grow the Robotics business; the impact of increased research and development spending; the impact of epidemics or pandemics such as COVID-19; the impact of a supply shortage on our supply chain and contract manufacturers; the consummation and success of any mergers or acquisitions; unexpected cash needs; the business judgment of the board of directors that a declaration of a dividend or the repurchase of common stock is not in Teradyne’s best interests; changes to U.S. or global tax regulations or guidance; the impact of any tariffs or export controls imposed by the U.S. or China; the impact of U.S. Department of Commerce or other government agency regulations relating to Huawei, HiSilicon and other customers or potential customers; the impact of U.S. Department -------------------------------------------------------------------------------- Page 3 Commerce export control regulations for certain U.S. products and technology sold to military end users or for military end-use in China; the impact of the Israel-Hamas conflict; the impact of regulations published by the U.S. Department of Commerce relating to semiconductors and semiconductor manufacturing equipment destined for certain end uses in China. The risks included above are not exhaustive. For a more detailed description of the risk factors associated with Teradyne, please refer to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, 2022 and Quarterly Report on Form 10-Q for the fiscal quarter ended October 1, 2023. Many of these factors are macroeconomic in nature and are, therefore, beyond Teradyne’s control. We caution readers not to place undue reliance on any forward-looking statements included in this press release which speak only as to the date of this press release. Teradyne specifically disclaims any obligation to update any forward-looking information contained in this press release or with respect to the announcements described herein. -------------------------------------------------------------------------------- Page 4 TERADYNE, INC. REPORT FOR FOURTH FISCAL QUARTER OF 2023 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS Quarter Ended Twelve Months Ended December 31, October 1, December 31, December 31, December 31, 2023 2023 2022 2023 2022 Net revenues $ 670,600 $ 703,732 $ 731,836 $ 2,676,298 $ 3,155,045 Cost of revenues (exclusive of acquired intangible assets amortization shown separately below) (1) 291,055 305,441 311,387 1,139,550 1,287,894 Gross profit 379,545 398,291 420,449 1,536,748 1,867,151 Operating expenses: Selling and administrative (2) 142,336 138,330 142,752 577,315 558,103 Engineering and development 102,207 104,413 108,810 418,089 440,591 Acquired intangible assets amortization 4,651 4,720 4,670 18,999 19,333 Restructuring and other (3) 6,027 6,856 (2,369 ) 21,277 17,185 Operating expenses 255,221 254,319 253,863 1,035,680 1,035,212 Income from operations 124,324 143,972 166,586 501,068 831,939 Interest and other (income) expense (4) (15,482 ) (308 ) (28,651 ) (24,504 ) (8,446 ) Income before income taxes 139,806 144,280 195,237 525,572 840,385 Income tax provision 22,752 16,164 22,936 76,820 124,884 Net income $ 117,054 $ 128,116 $ 172,301 $ 448,752 $ 715,501 Net income per common share: Basic $ 0.77 $ 0.83 $ 1.11 $ 2.91 $ 4.52 Diluted $ 0.72 $ 0.78 $ 1.04 $ 2.73 $ 4.22 Weighted average common shares - basic 152,812 153,762 155,762 154,310 158,434 Weighted average common shares - diluted (5) 162,106 164,050 165,468 164,304 169,734 Cash dividend declared per common share $ 0.11 $ 0.11 $ 0.11 $ 0.44 $ 0.44 (1) Cost of revenues includes: Quarter Ended Twelve Months Ended December 31, October 1, December 31, December 31, December 31, 2023 2023 2022 2023 2022 Provision for excess and obsolete inventory $ 5,289 $ 11,728 $ 11,787 $ 28,358 $ 31,452 Sale of previously written down inventory (1,115 ) (1,198 ) (828 ) (5,161 ) (1,808 ) $ 4,174 $ 10,530 $ 10,959 $ 23,197 $ 29,644 (2) For the twelve months ended December 31, 2023, selling and administrative expenses included an equity charge of $5.9 million for the modification of Teradyne’s retired CEO’s outstanding equity awards in connection with his February 1, 2023 retirement. (3) Restructuring and other consists of: Quarter Ended Twelve Months Ended December 31, October 1, December 31, December 31, December 31, 2023 2023 2022 2023 2022 Acquisition and divestiture related expenses $ 3,132 $ — $ — $ 3,132 $ — Employee severance 2,892 4,658 775 14,727 2,924 Contract termination — 1,511 — 1,511 — Litigation settlement — — — — 14,700 Gain on sale of asset — — (3,410 ) — (3,410 ) Other 3 687 266 1,907 2,971 $ 6,027 $ 6,856 $ (2,369 ) $ 21,277 $ 17,185 -------------------------------------------------------------------------------- Page 5 (4) Interest and other (income) expense includes: Quarter Ended Twelve Months Ended December 31, October 1, December 31, December 31, December 31, 2023 2023 2022 2023 2022 Pension actuarial losses (gains) $ 2,575 $ 72 $ (25,592 ) $ 2,703 $ (25,584 ) Gain on foreign exchange option (7,464 ) — — (7,464 ) — (5) Under GAAP, when calculating diluted earnings per share, convertible debt must be assumed to have converted if the effect on EPS would be dilutive. Diluted shares assume the conversion of the convertible debt as the effect would be dilutive. Accordingly, for the quarters ended December 31, 2023, October 1, 2023 and December 31, 2022, 0.2 million, 0.6 million and 1.2 million shares, respectively, have been included in diluted shares. For the twelve months ended December 31, 2023 and December 31, 2022, 0.6 million and 1.8 million shares, respectively, have been included in diluted shares. For the quarters ended December 31, 2023, October 1, 2023 and December 31, 2022, diluted shares also included 8.6 million, 9.2 million and 7.9 million shares, respectively, from the convertible note hedge transaction. For the twelve months ended December 31, 2023 and December 31, 2022, diluted shares included 8.9 million and 8.8 million shares, respectively, from the convertible note hedge transaction. -------------------------------------------------------------------------------- Page 6 CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) December 31, December 31, 2023 2022 Assets Cash and cash equivalents $ 757,571 $ 854,773 Marketable securities 62,154 39,612 Accounts receivable, net 422,124 491,145 Inventories, net 309,974 325,019 Prepayments 548,970 532,962 Other current assets 37,992 14,404 Current assets held for sale 23,250 — Total current assets 2,162,035 2,257,915 Property, plant and equipment, net 445,492 418,683 Operating lease right-of-use assets, net 73,417 73,734 Marketable securities 117,434 110,777 Deferred tax assets 175,775 142,784 Retirement plans assets 11,504 11,761 Other assets 38,580 28,925 Acquired intangible assets, net 35,404 53,478 Goodwill 415,652 403,195 Assets held for sale 11,531 — Total assets $ 3,486,824 $ 3,501,252 Liabilities Accounts payable $ 180,131 $ 139,722 Accrued employees’ compensation and withholdings 191,750 212,266 Deferred revenue and customer advances 99,804 148,285 Other accrued liabilities 114,712 112,271 Operating lease liabilities 17,522 18,594 Income taxes payable 48,653 65,010 Current debt — 50,115 Current liabilities held for sale 7,379 — Total current liabilities 659,951 746,263 Retirement plans liabilities 132,090 116,005 Long-term deferred revenue and customer advances 37,282 45,131 Long-term other accrued liabilities 19,998 15,981 Deferred tax liabilities 183 3,267 Long-term operating lease liabilities 65,092 64,176 Long-term income taxes payable 44,331 59,135 Liabilities held for sale 2,000 — Total liabilities 960,927 1,049,958 Shareholders’ equity 2,525,897 2,451,294 Total liabilities and shareholders’ equity $ 3,486,824 $ 3,501,252 -------------------------------------------------------------------------------- Page 7 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) Quarter Ended Twelve Months Ended December 31, December 31, December 31, December 31, 2023 2022 2023 2022 Cash flows from operating activities: Net income $ 117,054 $ 172,301 $ 448,752 $ 715,501 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 23,260 22,861 92,118 90,763 Stock-based compensation 12,443 10,808 57,682 48,228 Provision for excess and obsolete inventory 5,289 11,787 28,358 31,452 Amortization 4,685 4,900 18,768 19,912 Deferred taxes (13,616 ) (10,320 ) (37,642 ) (38,693 ) (Gains) losses on investments (11,756 ) (1,451 ) (14,915 ) 9,985 Retirement plans actuarial losses (gains) 2,575 (25,592 ) 2,703 (25,584 ) Gains on sale of asset — (3,410 ) — (3,410 ) Other (811 ) 1,621 (955 ) 2,353 Changes in operating assets and liabilities Accounts receivable 40,786 46,380 70,977 50,628 Inventories (1,068 ) (11,992 ) 5,327 (80,809 ) Prepayments and other assets 20,881 (46,382 ) (43,101 ) (140,713 ) Accounts payable and other liabilities 42,783 11,911 46,782 (60,507 ) Deferred revenue and customer advances (7,693 ) (337 ) (57,210 ) (6,233 ) Retirement plans contributions (1,794 ) (1,219 ) (5,492 ) (5,116 ) Income taxes 15,762 1,536 (26,921 ) (29,834 ) Net cash provided by operating activities 248,780 183,402 585,231 577,923 Cash flows from investing activities: Purchases of property, plant and equipment (44,336 ) (34,577 ) (159,642 ) (163,249 ) Purchases of marketable securities (24,120 ) (20,234 ) (161,906 ) (287,409 ) Proceeds from sales of marketable securities 24,438 8,858 61,401 268,058 Proceeds from maturities of marketable securities 13,595 40,849 85,042 222,941 Issuance of convertible loan — — (5,000 ) — Proceeds from life insurance — — 460 — Proceeds from sale of asset — 3,410 — 3,410 Net cash (used for) provided by investing activities (30,423 ) (1,694 ) (179,645 ) 43,751 Cash flows from financing activities: Repurchase of common stock (50,749 ) (2,082 ) (397,241 ) (752,082 ) Payments of convertible debt principal (23,529 ) (14,754 ) (50,264 ) (66,759 ) Dividend payments (16,797 ) (17,133 ) (67,878 ) (69,711 ) Payments related to net settlement of employee stock compensation awards (202 ) (183 ) (20,788 ) (33,170 ) Issuance of common stock under stock purchase and stock option plans 175 — 34,259 28,733 Net cash used for financing activities (91,102 ) (34,152 ) (501,912 ) (892,989 ) Effects of exchange rate changes on cash and cash equivalents (6,645 ) (3,529 ) (876 ) 3,889 Increase (decrease) in cash and cash equivalents 120,610 144,027 (97,202 ) (267,426 ) Cash and cash equivalents at beginning of period 636,961 710,746 854,773 1,122,199 Cash and cash equivalents at end of period $ 757,571 $ 854,773 $ 757,571 $ 854,773 -------------------------------------------------------------------------------- Page 8 GAAP to Non-GAAP Earnings Reconciliation (In millions, except per share amounts) Quarter Ended December 31, % of Net October 1, % of Net December 31, % of Net 2023 Revenues 2023 Revenues 2022 Revenues Net revenues $ 670.6 $ 703.7 $ 731.8 Gross profit GAAP and non-GAAP 379.5 56.6 % 398.3 56.6 % 420.4 57.4 % Income from operations - GAAP 124.3 18.5 % 144.0 20.5 % 166.6 22.8 % Restructuring and other (1) 6.0 0.9 % 6.9 1.0 % (2.4 ) -0.3 % Acquired intangible assets amortization 4.7 0.7 % 4.7 0.7 % 4.7 0.6 % Income from operations - non-GAAP $ 135.0 20.1 % $ 155.6 22.1 % $ 168.9 23.1 % Net Income Net Income Net Income per Common Share per Common Share per Common Share December 31, % of Net October 1, % of Net December 31, % of Net 2023 Revenues Basic Diluted 2023 Revenues Basic Diluted 2022 Revenues Basic Diluted Net income - GAAP $ 117.1 17.5 % $ 0.77 $ 0.72 $ 128.1 18.2 % $ 0.83 $ 0.78 $ 172.3 23.5 % $ 1.11 $ 1.04 Restructuring and other (1) 6.0 0.9 % 0.04 0.04 6.9 1.0 % 0.04 0.04 (2.4 ) -0.3 % (0.02 ) (0.01 ) Acquired intangible assets amortization 4.7 0.7 % 0.03 0.03 4.7 0.7 % 0.03 0.03 4.7 0.6 % 0.03 0.03 Pension mark-to-market adjustment (2) 2.6 0.4 % 0.02 0.02 0.1 0.0 % 0.00 0.00 (25.6 ) -3.5 % (0.16 ) (0.15 ) Gain on foreign exchange option (7.5 ) -1.1 % (0.05 ) (0.05 ) — — — — — — — — Exclude discrete tax adjustments 3.3 0.5 % 0.02 0.02 (4.8 ) -0.7 % (0.03 ) (0.03 ) (2.8 ) -0.4 % (0.02 ) (0.02 ) Non-GAAP tax adjustments 1.0 0.1 % 0.01 0.01 (3.5 ) -0.5 % (0.02 ) (0.02 ) 4.5 0.6 % 0.03 0.03 Convertible share adjustment (3) — — — — — — — — — — — 0.01 Net income - non-GAAP $ 127.2 19.0 % $ 0.83 $ 0.79 $ 131.5 18.7 % $ 0.86 $ 0.80 $ 150.8 20.6 % $ 0.97 $ 0.92 GAAP and non-GAAP weighted average common shares - basic 152.8 153.8 155.8 GAAP weighted average common shares - diluted 162.1 164.1 165.5 Exclude dilutive shares related to convertible note transaction (0.2 ) (0.6 ) (1.2 ) Non-GAAP weighted average common shares - diluted 161.9 163.4 164.3 (1) Restructuring and other consists of: Quarter Ended December 31, October 1, December 31, 2023 2023 2022 Acquisition and divestiture related expenses $ 3.1 $ — $ — Employee severance 2.9 4.7 0.8 Contract termination — 1.5 — Gain on sale of asset — — (3.4 ) Other — 0.6 0.3 $ 6.0 $ 6.9 $ (2.4 ) (2) For the quarters ended December 31, 2023, October 1, 2023 and December 31, 2022 adjustment to exclude actuarial (gain) loss recognized under GAAP in accordance with Teradyne’s mark-to-market pension accounting. -------------------------------------------------------------------------------- Page 9 (3) For the quarter ended December 31, 2022, the non-GAAP diluted EPS calculation adds back $0.2 million of convertible debt interest expense to non-GAAP net income. For the quarters ended December 31, 2023, October 1, 2023, and December 31, 2022, non-GAAP weighted average diluted common shares include 8.6 million, 9.2 million and 7.9 million shares, respectively, from the convertible note hedge transaction. Twelve Months Ended December 31, % of Net December 31, % of Net 2023 Revenues 2022 Revenues Net Revenues $ 2,676.3 $ 3,155.0 Gross profit GAAP and non-GAAP 1,536.7 57.4 % 1,867.2 59.2 % Income from operations - GAAP 501.1 18.7 % 831.9 26.4 % Restructuring and other (1) 21.3 0.8 % 17.2 0.5 % Acquired intangible assets amortization 19.0 0.7 % 19.3 0.6 % Equity modification charge (2) 5.9 0.2 % — — Income from operations - non-GAAP $ 547.3 20.4 % $ 868.4 27.5 % Net Income Net Income per Common Share per Common Share December 31, % of Net December 31, % of Net 2023 Revenues Basic Diluted 2022 Revenues Basic Diluted Net income - GAAP $ 448.8 16.8 % $ 2.91 $ 2.73 $ 715.5 22.7 % $ 4.52 $ 4.22 Restructuring and other (1) 21.3 0.8 % 0.14 0.13 17.2 0.5 % 0.11 0.10 Acquired intangible assets amortization 19.0 0.7 % 0.12 0.12 19.3 0.6 % 0.12 0.11 Equity modification charge (2) 5.9 0.2 % 0.04 0.04 — — — — Pension mark-to-market adjustment (3) 2.7 0.1 % 0.02 0.02 (25.6 ) -0.8 % (0.16 ) (0.15 ) Gain on foreign exchange option (7.5 ) -0.3 % (0.05 ) (0.05 ) — — — — Exclude discrete tax adjustments (3.4 ) -0.1 % (0.02 ) (0.02 ) (12.1 ) -0.4 % (0.08 ) (0.07 ) Non-GAAP tax adjustments (7.7 ) -0.3 % (0.05 ) (0.05 ) (1.4 ) 0.0 % (0.01 ) (0.01 ) Convertible share adjustment (4) — — — 0.01 — — — 0.05 Net income - non-GAAP $ 479.1 17.9 % $ 3.10 $ 2.93 $ 712.9 22.6 % $ 4.50 $ 4.25 GAAP and non-GAAP weighted average common shares - basic 154.3 158.4 GAAP weighted average common shares - diluted 164.3 169.7 Exclude dilutive shares from convertible note (0.6 ) (1.8 ) Non-GAAP weighted average common shares - diluted 163.7 167.9 (1) Restructuring and other consists of: Twelve Months Ended December 31, December 31, 2023 2022 Employee severance $ 14.8 $ 2.9 Acquisition and divestiture related expenses 3.1 — Contract termination 1.5 — Litigation settlement — 14.7 Gain on sale of asset — (3.4 ) Other 1.9 3.0 $ 21.3 $ 17.2 (2) For the twelve months ended December 31, 2023, selling and administrative expenses include an equity charge of $5.9 million for the modification of Teradyne’s retired CEO’s outstanding equity awards in connection with his February 1, 2023 retirement. -------------------------------------------------------------------------------- Page 10 (3) For the twelve months ended December 31, 2023 and December 31, 2022, adjustment to exclude actuarial (gain) loss recognized under GAAP in accordance with Teradyne’s mark-to-market pension accounting. (4) For the twelve months ended December 31, 2023 and December 31, 2022, the non-GAAP diluted EPS calculation adds back $0.2 million and $1.0 million, respectively, of convertible debt interest expense to non-GAAP net income. For the twelve months ended December 31, 2023 and December 31, 2022, non-GAAP weighted average diluted common shares include 8.9 million and 8.8 million shares, respectively, related to the convertible debt hedge transaction. GAAP to Non-GAAP Reconciliation of First Quarter 2024 guidance: GAAP and non-GAAP first quarter revenue guidance: $540 million to $590 million GAAP net income per diluted share $ 0.19 $ 0.35 Exclude acquired intangible assets amortization 0.03 0.03 Exclude restructuring and other charges 0.01 0.01 Non-GAAP tax adjustments (0.01 ) (0.01 ) Non-GAAP net income per diluted share $ 0.22 $ 0.38 For press releases and other information of interest to investors, please visit Teradyne’s homepage at http://www.teradyne.com. Contact: Teradyne, Inc. Andy Blanchard 978-370-2425 Vice President of Corporate Relations --------------------------------------------------------------------------------