10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended July 1, 2012

OR

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from             to            

Commission File No. 001-06462

TERADYNE, INC.

(Exact name of registrant as specified in its charter)

Massachusetts	04-2272148
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
600 Riverpark Drive, North Reading, Massachusetts	01864
(Address of Principal Executive Offices)	(Zip Code)

978-370-2700

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to the filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files)    Yes  x    No  ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act (check one):

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ¨    No  x

The number of shares outstanding of the registrant’s only class of Common Stock as of August 6, 2012 was 187,592,476 shares.

TERADYNE, INC.

INDEX

		Page No.
PART I. FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited):
	Condensed Consolidated Balance Sheets as of July 1, 2012 and December 31, 2011		1
	Condensed Consolidated Statements of Operations for the Three and Six Months Ended July  1, 2012 and July 3, 2011		2
	Condensed Consolidated Statements of Comprehensive Income for the Three and Six Months Ended July 1, 2012 and July 3, 2011		3
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended July 1, 2012 and July  3, 2011		4
	Notes to Condensed Consolidated Financial Statements		5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		28
Item 3.	Quantitative and Qualitative Disclosures about Market Risk		42
Item 4.	Controls and Procedures		42
PART II. OTHER INFORMATION
Item 1.	Legal Proceedings		43
Item 1A.	Risk Factors		43
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		43
Item 4.	Mine Safety Disclosures		43
Item 6.	Exhibits		44

PART I

Item 1: Financial Statements

TERADYNE, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

	July 1, 2012		December 31, 2011
	(in thousands, except per share amount)
ASSETS
Current assets:
Cash and cash equivalents	$	589,056	$	573,736
Marketable securities		105,947		96,502
Accounts receivable, less allowance for doubtful accounts of $4,160 and $4,102 at July 1, 2012 and December 31, 2011, respectively		346,124		129,330
Inventories:
Raw materials		92,994		109,315
Assemblies in process		27,078		33,856
Finished goods		17,826		16,892
		137,898		160,063
Deferred tax assets		56,888		53,948
Prepayments and other current assets		80,895		86,308
Total current assets		1,316,808		1,099,887
Property, plant and equipment		827,608		798,194
Less: Accumulated depreciation		579,608		565,987
Net property, plant and equipment		248,000		232,207
Long-term marketable securities		133,750		84,407
Retirement plan assets		7,182		8,840
Intangible assets, net		356,117		392,975
Goodwill		352,778		352,778
Other assets		20,035		17,545
Total assets	$	2,434,670	$	2,188,639
LIABILITIES
Current liabilities:
Accounts payable	$	117,343	$	69,842
Accrued employees’ compensation and withholdings		80,118		90,427
Deferred revenue and customer advances		83,710		78,670
Contingent consideration		54,662		68,892
Other accrued liabilities		64,298		62,420
Accrued income taxes		23,218		860
Current debt		2,522		2,573
Total current liabilities		425,871		373,684
Long-term deferred revenue and customer advances		22,303		33,541
Retirement plan liabilities		77,295		76,638
Deferred tax liabilities		37,915		16,049
Long-term other accrued liabilities		20,573		23,711
Long-term debt		165,283		159,956
Total liabilities		749,240		683,579
Commitments and contingencies (Note O)
SHAREHOLDERS’ EQUITY
Common stock, $0.125 par value, 1,000,000 shares authorized, 187,213 shares and 183,587 shares issued and outstanding at July 1, 2012 and December 31, 2011, respectively		23,402		22,948
Additional paid-in capital		1,327,574		1,293,130
Accumulated other comprehensive income		5,267		4,746
Retained earnings		329,187		184,236
Total shareholders’ equity		1,685,430		1,505,060
Total liabilities and shareholders’ equity	$	2,434,670	$	2,188,639

The accompanying notes, together with the Notes to Consolidated Financial Statements included in Teradyne’s

Annual Report on Form 10-K for the year ended December 31, 2011, are an integral part of the condensed

consolidated financial statements.

1

TERADYNE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
	(in thousands, except per share amount)
Net revenues:
Products	$	480,578		$	341,316		$	811,469		$	657,035
Services		67,706			69,203			133,483			130,645
Total net revenues		548,284			410,519			944,952			787,680
Cost of revenues:
Cost of products		206,498			160,403			380,499			313,283
Cost of services		32,280			35,438			64,021			66,827
Total cost of revenues		238,778			195,841			444,520			380,110
Gross profit		309,506			214,678			500,432			407,570
Operating expenses:
Engineering and development		66,532			48,392			126,667			95,536
Selling and administrative		73,366			57,880			141,143			115,611
Acquired intangible asset amortization		18,429			7,291			36,858			14,582
Restructuring and other, net		(6,262	)		1,279			(8,087	)		1,692
Total operating expenses		152,065			114,842			296,581			227,421
Income from operations		157,441			99,836			203,851			180,149
Interest income		874			1,403			1,767			2,690
Interest expense and other		(6,323	)		(5,316	)		(12,382	)		(11,492	)
Income from continuing operations before income taxes		151,992			95,923			193,236			171,347
Income tax provision		40,605			7,839			48,285			13,325
Income from continuing operations		111,387			88,084			144,951			158,022
Income from discontinued operations before income taxes		—			—			—			1,436
Income tax benefit		—			—			—			(267	)
Income from discontinued operations		—			—			—			1,703
(Loss) Gain on disposal of discontinued operations (net of income tax of $0, $0, $0, $4,578, respectively)		—			(832	)		—			24,371
Net income	$	111,387		$	87,252		$	144,951		$	184,096
Income per common share from continuing operations:
Basic	$	0.60		$	0.48		$	0.78		$	0.85
Diluted	$	0.49		$	0.38		$	0.63		$	0.68
Net income per common share:
Basic	$	0.60		$	0.47		$	0.78		$	0.99
Diluted	$	0.49		$	0.38		$	0.63		$	0.80
Weighted average common share—basic		186,573			185,367			186,205			185,044
Weighted average common share—diluted		229,646			230,452			230,399			231,266

The accompanying notes, together with the Notes to Consolidated Financial Statements included in Teradyne’s

Annual Report on Form 10-K for the year ended December 31, 2011, are an integral part of the condensed

consolidated financial statements.

2

TERADYNE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
	(in thousands)
Net income	$	111,387		$	87,252		$	144,951		$	184,096
Other comprehensive income, net of tax:
Foreign currency translation reclassification adjustment included in net income		—			—			—			2,266
Unrealized gains on marketable securities:
Unrealized gains on marketable securities arising during period		452			1,421			1,196			1,620
Less: Reclassification adjustment for gains included in net income		(24	)		(126	)		(490	)		(310	)
		428			1,295			706			1,310
Defined benefit pension and post-retirement plans:
Amortization of prior service (benefit) cost included in net periodic pension and post-retirement costs		(92	)		5			(183	)		11
Other comprehensive income		336			1,300			523			3,587
Comprehensive income	$	111,723		$	88,552		$	145,474		$	187,683

The accompanying notes, together with the Notes to Consolidated Financial Statements included in Teradyne’s

Annual Report on Form 10-K for the year ended December 31, 2011, are an integral part of the condensed

consolidated financial statements.

3

TERADYNE, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Six Months Ended
	July 1, 2012			July 3, 2011
	(in thousands)
Cash flows from operating activities:
Net income	$	144,951		$	184,096
Less: Income from discontinued operations		—			1,703
Less: Gain on disposal of discontinued operations		—			24,371
Income from continuing operations		144,951			158,022
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
Depreciation		25,578			25,645
Amortization		43,744			20,816
Stock-based compensation		21,396			14,682
Deferred taxes		15,937			—
Provision for excess and obsolete inventory		10,927			6,343
Non cash charge for the sale of inventories revalued at the date of acquisition		6,089			—
Contingent consideration adjustment		(8,406	)		—
Tax benefit related to stock options and restricted stock units		(7,600	)		(3,717	)
Retirement plans actuarial losses		3,054			4,203
Other		(438	)		1,684
Changes in operating assets and liabilities, net of businesses sold:
Accounts receivable		(216,794	)		(39,067	)
Inventories		21,446			(15,006	)
Other assets		5,027			(10,344	)
Deferred revenue and customer advances		(6,198	)		(28,339	)
Accounts payable and other accrued expenses		27,140			(9,275	)
Retirement plans contributions		(2,550	)		(5,245	)
Accrued income taxes		29,958			5,406
Net cash provided by continuing operations		113,261			125,808
Net cash used for discontinued operations		—			(4,225	)
Net cash provided by operating activities		113,261			121,583
Cash flows from investing activities:
Purchases of property, plant and equipment		(57,804	)		(44,467	)
Purchases of available-for-sale marketable securities		(156,771	)		(498,541	)
Proceeds from maturities of available-for-sale marketable securities		59,405			366,144
Proceed from sales of available-for-sale marketable securities		39,715			54,333
Net cash used for continuing operations		(115,455	)		(122,531	)
Net cash provided by discontinued operations		—			39,062
Net cash used for investing activities		(115,455	)		(83,469	)
Cash flows from financing activities:
Issuance of common stock under employee stock option and stock purchase plans		16,984			17,052
Tax benefit related to stock options and restricted stock units		7,600			3,717
Payments of long-term debt		(1,246	)		(1,222	)
Payments of contingent consideration		(5,824	)		—
Net cash provided by financing activities		17,514			19,547
Increase in cash and cash equivalents		15,320			57,661
Cash and cash equivalents at beginning of period		573,736			397,737
Cash and cash equivalents at end of period	$	589,056		$	455,398

The accompanying notes, together with the Notes to Consolidated Financial Statements included in Teradyne’s

Annual Report on Form 10-K for the year ended December 31, 2011, are an integral part of the condensed

consolidated financial statements.

4

TERADYNE, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

A. The Company

Teradyne, Inc. (“Teradyne”) is a leading global supplier of automatic test equipment. Teradyne’s automatic test equipment products and services include:

• semiconductor test (“Semiconductor Test”) systems,

• military/aerospace (“Mil/Aero”) test instrumentation and systems, storage test (“Storage Test”) systems, and circuit-board test and inspection (“Commercial Board Test”) systems (collectively these products represent “Systems Test Group”), and

• wireless test (“Wireless Test”) systems.

B. Accounting Policies

Basis of Presentation

The condensed consolidated interim financial statements include the accounts of Teradyne and its subsidiaries. All significant intercompany balances and transactions have been eliminated. These interim financial statements are unaudited and reflect all normal recurring adjustments that are, in the opinion of management, necessary for the fair presentation of such interim financial statements. Certain prior year’s amounts were reclassified to conform to the current year presentation. The December 31, 2011 condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America.

The accompanying financial information should be read in conjunction with the consolidated financial statements and notes thereto contained in Teradyne’s Annual Report on Form 10-K, filed with the U.S. Security and Exchange Commission (“SEC”) on February 29, 2012, for the year ended December 31, 2011.

Preparation of Financial Statements and Use of Estimates

The preparation of consolidated financial statements requires management to make estimates and judgments that affect the amounts reported in the financial statements. Actual results may differ significantly from these estimates.

C. Change in Accounting Principle

Effective January 1, 2012, Teradyne changed the method of recognizing actuarial gains and losses for its defined benefit pension plans and postretirement benefit plan and calculating the expected return on plan assets for its defined benefit pension plans. Historically, Teradyne recognized net actuarial gains and losses in accumulated other comprehensive income within shareholders’ equity on the consolidated balance sheets on an annual basis and amortized them into operating results over the average remaining years of service of the plan participants, to the extent such gains and losses were outside of a range (“corridor”). Teradyne has elected to immediately recognize net actuarial gains and losses and the change in the fair value of the plan assets in its operating results in the year in which they occur or upon any interim remeasurement of the plans. In addition, Teradyne used to calculate the expected return on plan assets using a calculated market-related value of plan assets. Teradyne has also elected to calculate the expected return on plan assets using the fair value of the plan assets.

Teradyne believes that this new method is preferable as it eliminates the delay in recognizing gains and losses in its operating results and it will improve the transparency by faster recognition of the effects of

5

economic and interest rate trends on plan obligations and investments. These actuarial gains and losses are generally measured annually as of December 31 and, accordingly, will be recorded during the fourth quarter of each year or upon any interim remeasurement of the plans. In accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 250, Accounting Changes and Error Corrections, all prior periods presented in this Quarterly Report on Form 10-Q have been adjusted to apply the new accounting method retrospectively. This accounting change did not impact the financial position of the reportable segments.

Had these changes not been made, net income for the three months and six months ended July 1, 2012 would have been $110.4 million and $140.3 million, respectively, compared to the $111.4 million and $145.0 million actually recorded. Diluted earnings per share would have been $0.48 and $0.61 compared to $0.49 and $0.63 for the three months and six months ended July 1, 2012, respectively.

The effects of the change in accounting principle on the condensed consolidated financial statements for 2011 are presented below. We have condensed the comparative financial statements for financial statement line items that were not affected by the change in accounting principle.

Condensed Consolidated Balance Sheets

	December 31, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Assets:
Total assets	$	2,188,639		$	—		$	2,188,639
Liabilities:
Total liabilities		683,579			—			683,579
Shareholders’ Equity:
Common stock		22,948			—			22,948
Additional paid-in capital		1,293,130			—			1,293,130
Accumulated other comprehensive (loss) income		(129,875	)		134,621			4,746
Retained earnings		318,857			(134,621	)		184,236
Total shareholders’ equity		1,505,060			—			1,505,060
Total liabilities and shareholders’ equity	$	2,188,639		$	—		$	2,188,639

6

Condensed Consolidated Statements of Operations

	For the Three Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands, except per share amounts)
Net revenues	$	410,519		$	—		$	410,519
Cost of revenues		195,433			408			195,841
Gross profit		215,086			(408	)		214,678
Operating expenses:
Engineering and development		47,393			999			48,392
Selling and administrative		57,481			399			57,880
Acquired intangible asset amortization		7,291			—			7,291
Restructuring and other		1,279			—			1,279
Total operating expenses		113,444			1,398			114,842
Income from operations		101,642			(1,806	)		99,836
Interest income		1,403			—			1,403
Interest expense and other, net		(5,316	)		—			(5,316	)
Income from continuing operations before income taxes		97,729			(1,806	)		95,923
Provision for income taxes		7,839			—			7,839
Income from continuing operations		89,890			(1,806	)		88,084
Loss on disposal of discontinued operations		(832	)		—			(832	)
Net income	$	89,058		$	(1,806	)	$	87,252
Net income per common share from continuing operations:
Basic	$	0.48		$	—		$	0.48
Diluted	$	0.39		$	(0.01	)	$	0.38
Net income per common share:
Basic	$	0.48		$	(0.01	)	$	0.47
Diluted	$	0.39		$	(0.01	)	$	0.38
Weighted average common share—basic		185,367						185,367
Weighted average common share—diluted		230,452						230,452

7

	For the Six Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands, except per share amounts)
Net revenues	$	787,680		$	—		$	787,680
Cost of revenues		380,185			(75	)		380,110
Gross profit		407,495			75			407,570
Operating expenses:
Engineering and development		95,370			166			95,536
Selling and administrative		115,710			(99	)		115,611
Acquired intangible asset amortization		14,582			—			14,582
Restructuring and other		1,692			—			1,692
Total operating expenses		227,354			67			227,421
Income from operations		180,141			8			180,149
Interest income		2,690			—			2,690
Interest expense and other, net		(11,492	)		—			(11,492	)
Income from continuing operations before income taxes		171,339			8			171,347
Provision for income taxes		13,325			—			13,325
Income from continuing operations		158,014			8			158,022
Income from discontinued operations before income taxes		1,278			158			1,436
Benefit from income taxes		(267	)		—			(267	)
Income from discontinued operations		1,545			158			1,703
Gain on disposal of discontinued operations (net of tax of $4,578)		24,371			—			24,371
Net income	$	183,930		$	166		$	184,096
Net income per common share from continuing operations:
Basic	$	0.85		$	—		$	0.85
Diluted	$	0.68		$	—		$	0.68
Net income per common share:
Basic	$	0.99		$	—		$	0.99
Diluted	$	0.80		$	—		$	0.80
Weighted average common share—basic		185,044						185,044
Weighted average common share—diluted		231,266						231,266

8

Condensed Consolidated Statements of Comprehensive Income

	For the Three Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Net income	$	89,058		$	(1,806	)	$	87,252
Other comprehensive income, net of tax:
Unrealized gains on marketable securities		1,295			—			1,295
Defined benefit pension and post-retirement plans:
Actuarial losses arising during period, net of tax of ($10), $10		(4,150	)		4,150			—
Settlement gain, net of tax of $38, ($38)		217			(217	)		—
Less: Amortization included in net periodic pension and post-retirement costs:
Actuarial losses, net of tax of $8, ($8)		2,377			(2,377	)		—
Prior service costs, net of tax of $0		5			—			5
		2,382			(2,377	)		5
Other comprehensive income		(256	)		1,556			1,300
Comprehensive income	$	88,802		$	(250	)	$	88,552

	For the Six Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Net income	$	183,930		$	166		$	184,096
Other comprehensive income, net of tax:
Foreign currency translation reclassification adjustment included in net income		2,266			—			2,266
Unrealized gains on marketable securities		1,310			—			1,310
Defined benefit pension and post-retirement plans:
Actuarial losses arising during period, net of tax of ($5), $5		(4,201	)		4,201			—
Settlement gain, net of tax of $73, ($73)		277			(277	)		—
Less: Amortization included in net periodic pension and post-retirement costs:
Actuarial losses, net of tax of $20, ($20)		4,455			(4,455	)		—
Prior service costs, net of tax of $0		11			—			11
		4,466			(4,455	)		11
Other comprehensive income		4,118			(531	)		3,587
Comprehensive income	$	188,048		$	(365	)	$	187,683

9

Condensed Consolidated Statements of Cash Flows

	For the Six Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Cash flows from operating activities:
Net income	$	183,930		$	166		$	184,096
Less: Income from discontinued operations		1,545			158			1,703
Less: Gain on disposal of discontinued operations		24,371			—			24,371
Income from continuing operations		158,014			8			158,022
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
Depreciation		25,645			—			25,645
Amortization		25,289			(4,473	)		20,816
Stock-based compensation		14,682			—			14,682
Provision for excess and obsolete inventory		6,343			—			6,343
Tax benefit related to stock options and restricted stock units		(3,717	)		—			(3,717	)
Other		1,422			4,465			5,887
Changes in operating assets and liabilities, net of businesses sold:
Accounts receivable		(39,067	)		—			(39,067	)
Inventories		(15,006	)		—			(15,006	)
Other assets		(10,344	)		—			(10,344	)
Deferred revenue and customer advances		(28,339	)		—			(28,339	)
Accounts payable and other accrued expenses		(9,275	)		—			(9,275	)
Retirement plan contributions		(5,245	)		—			(5,245	)
Accrued income taxes		5,406			—			5,406
Net cash provided by continuing operations		125,808			—			125,808
Net cash used for discontinued operations		(4,225	)		—			(4,225	)
Net cash provided by operating activities		121,583			—			121,583
Net cash used for investing activities		(83,469	)		—			(83,469	)
Net cash provided by financing activities		19,547			—			19,547
Increase in cash and cash equivalents		57,661			—			57,661
Cash and cash equivalents at beginning of period		397,737			—			397,737
Cash and cash equivalents at end of period	$	455,398		$	—		$	455,398

D. Recently Issued Accounting Pronouncements

In December 2011, the FASB issued ASU No. 2011-11, “Disclosures about Offsetting Assets and Liabilities.” This ASU is intended to enhance the understanding of the effects of netting arrangements on an entity’s financial statements, including financial instruments and derivative instruments that are either offset or subject to a master netting arrangement. The scope of this ASU includes derivatives, sale and repurchase agreements, reverse sale and repurchase agreements, and securities borrowing and lending arrangements. The provisions of this ASU are effective for interim and annual periods beginning on or after January 1, 2013.

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E. Discontinued Operations

On March 21, 2011, Teradyne completed the sale of its Diagnostic Solutions business unit, which was included in the Systems Test Group segment, to SPX Corporation for $40.2 million in cash. Teradyne sold this business as its growth potential as a stand-alone business within Teradyne was significantly less than if it was part of a larger automotive supplier. The financial information for Diagnostic Solutions has been reclassified to discontinued operations for all periods presented. Net revenues and income from discontinued operations for the three and six months ended July 3, 2011 were as follows:

	For the Three  Months Ended July 3, 2011			For the Six  Months Ended July 3, 2011
	(in thousands)
Net revenues	$	—		$	9,086
Income from discontinued operations before income taxes	$	—		$	1,436
(Loss) Gain from disposal of discontinued operations before income taxes		(832	)		28,949
Income tax provision		—			4,311
(Loss) Income from discontinued operations	$	(832	)	$	26,074

F. Financial Instruments and Derivatives

Financial Instruments

Teradyne uses the market and income approach to value its financial instruments and there was no change in valuation techniques used by Teradyne during the three and six months ended July 1, 2012 and July 3, 2011. As defined in ASC 820-10, “Fair Value Measurements and Disclosures”, fair value is the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. ASC 820-10 requires that assets and liabilities are carried at fair value and are classified in one of the following three categories:

Level 1: Quoted prices in active markets for identical assets as of the reporting date.

Level 2: Inputs other than Level 1, that are observable either directly or indirectly as of the reporting date. For example, a common approach for valuing fixed income securities is the use of matrix pricing. Matrix pricing is a mathematical technique used to value securities by relying on the securities’ relationship to other benchmark quoted prices.

Level 3: Unobservable inputs that are not supported by market data. Unobservable inputs are developed based on the best information available, which might include Teradyne’s own data.

Most of Teradyne’s fixed income securities are classified as Level 2, with the exception of U.S. Treasury securities and investments in equity and debt mutual funds, which are classified as Level 1, and contingent consideration, which is classified as Level 3. As of July 1, 2012, the majority of Level 2 securities were priced by pricing vendors. These pricing vendors utilize the most recent observable market information in pricing these securities or, if specific prices are not available, use other observable inputs like market transactions involving identical or comparable securities.

During the six months ended July 1, 2012 and July 3, 2011, there were no transfers in and out of Level 1, Level 2 and Level 3.

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The following table sets forth by fair value hierarchy Teradyne’s financial assets and liabilities that were measured at fair value on a recurring basis as of July 1, 2012 and December 31, 2011.

	July 1, 2012
	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in thousands)
Assets
Cash	$	214,948	$	—	$	—	$	214,948
Cash equivalents		363,877		10,231		—		374,108
Available for sale securities:
U.S. government agency securities		—		112,315		—		112,315
Corporate debt securities		—		48,891		—		48,891
Commercial paper		—		30,990		—		30,990
U.S. Treasury securities		28,673		—		—		28,673
Certificates of deposit and time deposits		—		9,500		—		9,500
Equity and debt mutual funds		9,058		—		—		9,058
Non-U.S. government securities		270		—		—		270
Total	$	616,826	$	211,927	$	—	$	828,753
Liabilities
Contingent consideration	$	—	$	—	$	54,662	$	54,662
Derivatives		—		81		—		81
Total	$	—	$	81	$	54,662	$	54,743

Reported as follows:

	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets
Cash and cash equivalents	$	578,825	$	10,231	$	—	$	589,056
Marketable securities		5,431		100,516		—		105,947
Long-term marketable securities		32,570		101,180		—		133,750
	$	616,826	$	211,927	$	—	$	828,753
Liabilities
Contingent consideration	$	—	$	—	$	54,662	$	54,662
Other accrued liabilities		—		81		—		81
	$	—	$	81	$	54,662	$	54,743

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	December 31, 2011
	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in thousands)
Assets
Cash	$	161,243	$	—	$	—	$	161,243
Cash equivalents		396,329		16,164		—		412,493
Available for sale securities:
U.S. government agency securities		—		83,197		—		83,197
Corporate debt securities		—		44,829		—		44,829
Commercial paper		—		22,075		—		22,075
U.S. Treasury securities		14,180		—		—		14,180
Equity and debt mutual funds		8,237		—		—		8,237
Certificates of deposit and time deposits		—		8,117		—		8,117
Non-U.S. government securities		274		—		—		274
Total	$	580,263	$	174,382	$	—	$	754,645
Liabilities
Contingent consideration	$	—	$	—	$	68,892	$	68,892
Derivatives		—		314		—		314
Total	$	—	$	314	$	68,892	$	69,206

Reported as follows:

	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets
Cash and cash equivalents	$	557,572	$	16,164	$	—	$	573,736
Marketable securities		9,044		87,458		—		96,502
Long-term marketable securities		13,647		70,760		—		84,407
	$	580,263	$	174,382	$	—	$	754,645
Liabilities
Contingent consideration	$	—	$	—	$	68,892	$	68,892
Other accrued liabilities		—		314		—		314
	$	—	$	314	$	68,892	$	69,206

Contingent consideration is measured at fair value and is based on significant inputs not observable in the market, which represents a Level 3 measurement within the fair value hierarchy. The valuation of contingent consideration uses assumptions and estimates to forecast a range of outcomes. Teradyne assesses these assumptions and estimates on a quarterly basis as additional data impacting the assumptions is obtained. Changes in the fair value of contingent consideration related to updated assumptions and estimates are recognized within the condensed consolidated statements of operations.

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The following table provides quantitative information associated with the fair value measurement of Teradyne’s Level 3 financial instrument:

	July 1, 2012			Weighted Average
Liability	Fair Value	Valuation Technique	Unobservable Inputs
	(in thousands)
Contingent consideration	$54,662	Income approach— discounted cash flow	Revenue earn-out—probability of low case (scenario) for calendar year 2012 revenue.		70	%
			Revenue earn-out—probability of high case (scenario) for calendar year 2012 revenue.		30	%
			Discount rate for revenue earn-out		3.5	%
			Discount rate for new product earn-out		3.5	%

The significant unobservable inputs used in the fair value measurement of contingent consideration are the probabilities of successful achievement of calendar year 2012 revenues, the quarterly period in which the revenues are expected to be achieved and a discount rate. Increases or decreases in the revenue probabilities and the period in which revenues will be achieved would result in a higher or lower fair value measurement.

The following table represents changes in the fair value of Level 3 contingent consideration:

	Contingent consideration
	(in thousands)
Balance at December 31, 2011	$	68,892
Fair value adjustment		(1,858	)
Payment		(5,824	)
Balance at April 1, 2012		61,210
Fair value adjustment		(6,548	)
Balance at July 1, 2012	$	54,662

Proceeds from sales of available-for-sale marketable securities were $39.7 million and $54.3 million, respectively, for the six months ended July 1, 2012 and July 3, 2011.

During the three and six months ended July 1, 2012, Teradyne recorded a net gain of $0.3 million and $0.6 million, respectively, from sales of marketable securities. During the three and six months ended July 3, 2011, Teradyne recorded a net gain of $0.1 million and a net loss $0.1 million, respectively, from sales of marketable securities.

Realized losses from sales of marketable securities are included in interest expense and other. Realized gains from sales of marketable securities are included in interest income.

The carrying amounts and fair values of financial instruments at July 1, 2012 and December 31, 2011 were as follows:

	July 1, 2012				December 31, 2011
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(in thousands)
Cash and cash equivalents	$	589,056	$	589,056	$	573,736	$	573,736
Marketable securities		239,697		239,697		180,909		180,909
Convertible debt(1)		162,762		496,138		156,098		485,925
Japan loan		5,043		5,043		6,431		6,431

(1) The carrying value represents the bifurcated debt component only, while the fair value is based on quoted market prices for the convertible note which includes the equity conversion feature.

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The fair values of cash and cash equivalents, accounts receivable, net and accounts payable approximate the carrying amount due to the short-term maturities of these instruments.

At July 1, 2012 and December 31, 2011, available-for-sale marketable securities were reported as follows:

	July 1, 2012
	Available-for-Sale									Fair Market Value of Investments with  Unrealized Losses
	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value
	(in thousands)
U.S. government agency securities	$	112,162	$	168	$	(15	)	$	112,315	$	49,867
Corporate debt securities		46,890		2,071		(70	)		48,891		18,236
Commercial paper		30,994		5		(9	)		30,990		13,234
U.S. Treasury securities		28,564		109		—			28,673		—
Certificates of deposit and time deposits		9,501		—		(1	)		9,500		5,822
Equity and debt mutual funds		8,345		726		(13	)		9,058		332
Non-U.S. government securities		270		—		—			270		—
	$	236,726	$	3,079	$	(108	)	$	239,697	$	87,491

Reported as follows:

	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value		Fair Market Value of Investments with Unrealized Losses
	(in thousands)
Marketable securities	$	105,954	$	12	$	(19	)	$	105,947	$	47,572
Long-term marketable securities		130,772		3,067		(89	)		133,750		39,919
	$	236,726	$	3,079	$	(108	)	$	239,697	$	87,491

	December 31, 2011
	Available-for-Sale									Fair Market Value of Investments with  Unrealized Losses
	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value
	(in thousands)
U.S. government agency securities	$	83,070	$	152	$	(25	)	$	83,197	$	28,510
Corporate debt securities		43,077		1,893		(141	)		44,829		17,033
Commercial paper		22,083		2		(10	)		22,075		9,479
U.S. Treasury securities		14,141		39		—			14,180		—
Equity and debt mutual funds		7,876		477		(116	)		8,237		3,749
Certificates of deposit and time deposits		8,122		—		(5	)		8,117		5,800
Non-U.S. government securities		256		18		—			274		—
	$	178,625	$	2,581	$	(297	)	$	180,909	$	64,571

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Reported as follows:

	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value		Fair Market Value of Investments with Unrealized Losses
	(in thousands)
Marketable securities	$	96,518	$	24	$	(40	)	$	96,502	$	35,595
Long-term marketable securities		82,107		2,557		(257	)		84,407		28,976
	$	178,625	$	2,581	$	(297	)	$	180,909	$	64,571

As of July 1, 2012, the fair market value of marketable securities with unrealized losses totaled $87.5 million. Of this value, $7.1 million had unrealized losses greater than one year and $80.4 million had unrealized losses less than one year. As of December 31, 2011, the fair market value of marketable securities with unrealized losses totaled $64.6 million. Of this value, $2.4 million had unrealized losses greater than one year and $62.2 million had unrealized losses less than one year.

The contractual maturities of available-for-sale marketable securities as of July 1, 2012 were as follows:

	July 1, 2012
	Cost		Fair Market Value
Due within one year	$	107,961	$	107,954
Due after 1 year through 5 years		110,388		111,299
Due after 5 years through 10 years		2,662		2,836
Due after 10 years		15,715		17,608
Total	$	236,726	$	239,697

Derivatives

Teradyne conducts business in a number of foreign countries, with certain transactions denominated in local currencies. The purpose of Teradyne’s foreign currency management is to minimize the effect of exchange rate fluctuations on certain foreign currency denominated net monetary assets. Teradyne does not use derivative financial instruments for trading or speculative purposes.

To minimize the effect of exchange rate fluctuations associated with the remeasurement of monetary assets and liabilities denominated in foreign currencies, Teradyne enters into foreign currency forward contracts. The change in fair value of these derivatives is recorded directly in earnings, and is used to offset the change in fair value of the monetary assets and liabilities denominated in foreign currencies.

The notional amount of foreign exchange contracts hedging monetary assets and liabilities denominated in foreign currencies was $74.4 million and $85.4 million at July 1, 2012 and December 31, 2011, respectively.

The following table summarizes the fair value of derivative instruments at July 1, 2012 and December 31, 2011.

	Balance Sheet Location		July 1, 2012		December 31, 2011
			(in thousands)
Derivatives not designated as hedging instruments:
Foreign exchange contracts		Other accrued liabilities	$	81	$	314
			$	81	$	314

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The following table summarizes the effect of derivative instruments in the statement of operations recognized during the three and six months ended July 1, 2012 and July 3, 2011. The table does not reflect the corresponding gains (losses) from the remeasurement of the monetary assets and liabilities denominated in foreign currencies.

	Location of Gains (Losses) Recognized in Statement of Operations		For the Three Months Ended						For the Six Months Ended
			July 1, 2012			July 3, 2011			July 1, 2012		July 3, 2011
			(in thousands)
Derivatives not designated as hedging instruments:
Foreign exchange contracts		Interest expense and other	$	(2,360	)	$	(166	)	$	520	$	661
			$	(2,360	)	$	(166	)	$	520	$	661

See Note G “Debt” regarding derivatives related to convertible senior notes.

G. Debt

Loan Agreement

On March 31, 2009, Teradyne K.K., Teradyne’s wholly-owned subsidiary in Japan, entered into a loan agreement with a local bank in Japan to borrow approximately $10.0 million. The loan has a term of 5 years and a fixed interest rate of 0.81%. Approximately $6.0 million of the loan is collateralized by a real estate mortgage on Teradyne K.K.’s building and land in Kumamoto, Japan and approximately $4.0 million is unsecured. Teradyne, Inc. has guaranteed payment of the loan obligation. The loan is amortized over the term of the loan with semiannual principal payments of approximately $1.0 million payable on September 30 and March 30 each year. At July 1, 2012, approximately $2.5 million of the outstanding loan principal is included in current debt and approximately $2.5 million is classified as long-term debt.

Convertible Senior Notes

In April 2009, Teradyne issued 4.50% convertible senior notes (the “Notes”) at an aggregate principal amount of $190 million. The Notes will mature on March 15, 2014, unless earlier repurchased by Teradyne or converted. The Notes are senior unsecured obligations and rank equally with all of Teradyne’s existing and future senior debt and senior to any of Teradyne’s subordinated debt.

The Notes may be converted, under certain circumstances and during certain periods, at an initial conversion rate of approximately 182.65 shares of Teradyne’s common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $5.48, a 25% conversion premium based on the last reported sale price of $4.38 per share of Teradyne’s common stock on March 31, 2009. The conversion rate is subject to adjustment in certain circumstances including but not limited to Teradyne issuing a cash or stock dividend or effecting a stock split.

During the three months ended July 1, 2012, the following circumstance that allows holders to convert their Notes at their option prior to December 15, 2013 occurred: the last reported sale price of Teradyne’s common stock for 20 or more trading days in a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter exceeded 130% of the conversion price in effect on the last trading day of the immediately preceding calendar quarter. As of August 10, 2012, no holders have exercised their option to convert their Notes.

Concurrently with the offering of the Notes, Teradyne entered into a convertible note hedge transaction with a strike price equal to the initial conversion price of the Notes, or approximately $5.48. The convertible note hedge allows Teradyne to receive shares of its common stock and/or cash related to the excess conversion value

17

that it would pay to the holders of the Notes upon conversion. The convertible note hedges will cover, subject to customary antidilution adjustments, approximately 34,703,196 shares of Teradyne’s common stock. Teradyne paid approximately $64.6 million for the convertible note hedges.

On March 31, 2009, Teradyne entered into a warrant transaction with a strike price of approximately $7.67 per share, which was 75% higher than the closing price of Teradyne’s common stock. Teradyne received approximately $43.0 million for the warrants.

The convertible note hedge and warrant transaction will generally have the effect of increasing the conversion price of the Notes to approximately $7.67 per share of Teradyne’s common stock, representing a 75% conversion premium based upon the closing price of Teradyne’s common stock on March 31, 2009.

The Notes are classified as long-term debt in the balance sheet at July 1, 2012 and December 31, 2011. The tables below represent the components of Teradyne’s convertible senior notes:

	July 1, 2012		December 31, 2011
	(in thousands)
Debt principal	$	190,000	$	190,000
Unamortized debt discount		27,238		33,902
Net carrying amount of the convertible debt	$	162,762	$	156,098

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Contractual interest expense	$	2,138	$	2,138	$	4,299	$	4,347
Amortization of the discount component and debt issue fees		3,592		3,160		7,071		6,221
Total interest expense on the convertible debt	$	5,730	$	5,298	$	11,370	$	10,568

As of July 1, 2012, the unamortized discount was $27.2 million, which will be amortized over approximately 1.75 years, and the carrying amount of the equity component was $63.4 million. As of July 1, 2012, the conversion rate was equal to the initial conversion price of approximately $5.48 per share and the if-converted value of the Notes was $487.9 million.

H. Deferred Revenue and Customer Advances

Deferred revenue and customer advances consist of the following and are included in short and long-term deferred revenue and customer advances.

	July 1, 2012		December 31, 2011
	(in thousands)
Customer advances	$	54,149	$	70,001
Maintenance, training and extended warranty		45,826		33,953
Undelivered elements		5,314		7,939
Acceptance		724		318
Total deferred revenue and customer advances	$	106,013	$	112,211

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I. Product Warranty

Teradyne generally provides a one-year warranty on its products commencing upon installation or shipment. A provision is recorded upon revenue recognition to cost of revenues for estimated warranty expense based on historical experience. Related costs are charged to the warranty accrual as incurred. The balance below is included in other accrued liabilities.

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
	(in thousands)
Balance at beginning of period	$	8,722		$	9,502		$	8,154		$	9,886
Accruals for warranties issued during the period		5,649			3,976			9,425			7,553
Adjustments related to pre-existing warranties		403			(1,116	)		143			(2,072	)
Settlements made during the period		(3,727	)		(3,100	)		(6,675	)		(6,105	)
Balance at end of period	$	11,047		$	9,262		$	11,047		$	9,262

When Teradyne receives revenue for extended warranties beyond one year, it is deferred and recognized on a straight-line basis over the contract period. Related costs are expensed as incurred. The balance below is included in deferred revenue and customer advances and long-term other accrued liabilities.

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
	(in thousands)
Balance at beginning of period	$	12,927		$	9,870		$	12,742		$	8,972
Deferral of new extended warranty revenue		9,935			1,861			12,282			3,798
Recognition of extended warranty deferred revenue		(2,108	)		(1,423	)		(4,270	)		(2,462	)
Balance at end of period	$	20,754		$	10,308		$	20,754		$	10,308

J. Stock-Based Compensation

Restricted stock unit awards granted to employees vest in equal installments over four years. A portion of restricted stock unit awards granted to executive officers is subject to service-based vesting and a portion of the awards is subject to performance-based vesting. The percentage level of performance satisfied for performance-based grants is assessed on or near the anniversary of the grant date and, in turn, that percentage level determines the number of performance-based restricted stock units available for vesting over the vesting period; portions of the performance-based grants not available for vesting are forfeited. Service-based stock options vest in equal installments over four years, and have a term of seven years from the date of grant.

During the six months ended July 1, 2012, Teradyne granted 1.6 million of restricted stock unit awards to employees at a weighted average grant date fair value of $16.83 and 0.2 million of service-based stock options to executive officers at a weighted average grant date fair value of $6.85.

During the six months ended July 3, 2011, Teradyne granted 1.7 million of restricted stock unit awards to employees at a weighted average grant date fair value of $16.20 and 0.1 million of service-based stock options to executive officers at a weighted average grant date fair value of $6.74.

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The fair value of stock options was estimated using the Black-Scholes option-pricing model with the following assumptions:

	For the Six Months Ended
	July 1, 2012			July 3, 2011
Expected life (years)		3.50			4.00
Interest rate		0.4	%		1.5	%
Volatility-historical		56.0	%		52.1	%
Dividend yield		0.0	%		0.0	%

Teradyne determined the stock options’ expected life based upon historical exercise data for executive officers, the age of the executive officers and the terms of the stock option grant. Volatility was determined using historical volatility for a period equal to the expected life. The risk-free rate was determined using the U.S. Treasury yield curve in effect at the time of grant.

The weighted-average fair value of employee stock purchase rights granted in the first six months of 2012 and 2011 was $4.09 and $3.66, respectively. The fair value of the employees’ purchase rights was estimated using the Black-Scholes option-pricing model with the following assumptions:

	For the Six Months Ended
	July 1, 2012			July 3, 2011
Expected life (years)		0.5			0.5
Interest rate		0.06	%		0.19	%
Volatility-historical		52.6	%		41.5	%
Dividend yield		0.0	%		0.0	%

K. Intangible Assets

Amortizable intangible assets consist of the following and are included in intangible assets on the balance sheet:

	July 1, 2012
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Useful Life
	(in thousands)
Developed technology	$	358,155	$	117,363	$	240,792		6.3 years
Customer relationships and service and software maintenance contracts		144,971		54,347		90,624		8.0 years
Trade names and trademarks		33,840		9,139		24,701		9.0 years
Customer backlog		1,000		1,000		—		0.4 years
Total intangible assets	$	537,966	$	181,849	$	356,117		7.0 years

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	December 31, 2011
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Useful Life
	(in thousands)
Developed technology	$	358,155	$	91,391	$	266,764		6.3 years
Customer relationships and service and software maintenance contracts		144,971		45,230		99,741		8.0 years
Trade names and trademarks		33,840		7,370		26,470		9.0 years
Customer backlog		1,000		1,000		—		0.4 years
Total intangible assets	$	537,966	$	144,991	$	392,975		7.0 years

Aggregate intangible asset amortization expense was $18.4 million and $36.9 million, respectively, for the three and six months ended July 1, 2012 and $7.3 million and $14.6 million, respectively, for the three and six months ended July 3, 2011. Estimated intangible asset amortization expense for each of the five succeeding fiscal years is as follows:

Year	Amortization Expense
	(in thousands)
2012 (remainder)	$	36,650
2013		72,459
2014		69,374
2015		52,351
2016		52,351

L. Net Income per Common Share

The following table sets forth the computation of basic and diluted net income per common share:

	For the Three Months Ended					For the Six Months Ended
	July 1, 2012		July 3, 2011			July 1, 2012		July 3, 2011
	(in thousands, except per share amounts)
Income from continuing operations	$	111,387	$	88,084		$	144,951	$	158,022
Income from discontinued operations		—		—			—		1,703
(Loss) Gain on disposal of discontinued operations		—		(832	)		—		24,371
Net income for basic net income per share	$	111,387	$	87,252		$	144,951	$	184,096
Weighted average common shares-basic		186,573		185,367			186,205		185,044
Effect of dilutive potential common shares:
Incremental shares from assumed conversion of convertible notes(1)		22,301		22,711			22,651		23,036
Convertible note hedge warrant shares(2)		17,340		17,914			17,829		18,368
Restricted stock units		1,171		3,877			1,405		4,222
Stock options		2,160		469			2,247		508
Employee stock purchase rights		101		114			62		88
Dilutive potential common shares		43,073		45,085			44,194		46,222
Weighted average common shares-diluted		229,646		230,452			230,399		231,266
Net income per common share-basic
Continuing operations	$	0.60	$	0.48		$	0.78	$	0.85
Discontinued operations		—		(0.01	)		—		0.14
	$	0.60	$	0.47		$	0.78	$	0.99
Net income per common share-diluted
Continuing operations	$	0.49	$	0.38		$	0.63	$	0.68
Discontinued operations		—		—			—		0.12
	$	0.49	$	0.38		$	0.63	$	0.80

21

(1) Incremental shares from assumed conversion of the convertible notes for the three and six months ended July 1, 2012 and July 3, 2011 are calculated using the difference between the average Teradyne stock price for the period and the conversion price of $5.48, multiplied by the 34.7 million shares that would be issued upon conversion. The result of this calculation, representing the total intrinsic value of the convertible debt, is divided by the average Teradyne stock price for the period.

(2) Convertible note hedge warrant shares for the three and six months ended July 1, 2012 and July 3, 2011 are calculated using the difference between the average Teradyne stock price for the period and the warrant price of $7.67, multiplied by the 34.7 million shares that would be issued upon conversion. The result of this calculation, representing the total intrinsic value of the warrant, is divided by the average Teradyne stock price for the period.

The computation of diluted net income per common share for the three and six months ended July 1, 2012 excludes the effect of the potential exercise of stock options to purchase approximately 0.3 million shares, and the computation of diluted net income per common share for the three and six months ended July 1, 2012 excludes the effect of the potential exercise of restricted stock units of 0.1 million, because the effect would have been anti-dilutive.

The computation of diluted net income per common share for the three and six months ended July 3, 2011 excludes the effect of the potential exercise of stock options to purchase approximately 0.5 million and 1.0 million shares, respectively, because the effect would have been anti-dilutive.

With respect to the Teradyne’s convertible debt, Teradyne intends to settle its conversion spread (i.e., the intrinsic value of the embedded option feature contained in the convertible debt) in shares. Teradyne accounts for its conversion spread using the treasury stock method.

M. Restructuring and Other, Net

Other

During the three and six months ended July 1, 2012, due to a decrease in specified new product revenue through the December 31, 2012 earn-out period end date, Teradyne recorded a $6.5 million and $8.4 million, respectively, fair value adjustment to decrease the LitePoint acquisition contingent consideration. As of July 1, 2012, the estimated undiscounted range of outcomes for the contingent consideration is $56.0 million to $58.0 million. The decrease in the range from December 31, 2011 is due to the $5.8 million contingent consideration payment during the six months ended July 1, 2012 and the $8.4 million fair value decrease.

During the six months ended July 3, 2011, Teradyne recorded a $0.7 million charge related to a non-U.S. pension settlement.

22

Restructuring

In response to a downturn in the industry in 2008 and 2009, Teradyne initiated restructuring activities across all segments to reduce costs, principally through headcount reductions and facility consolidations. The remaining accrual for lease payments on vacated facilities of $1.5 million is reflected in the other accrued liabilities account and the long-term other accrued liabilities account and is expected to be paid over the lease terms, the latest of which expires in 2013. Teradyne expects to pay approximately $0.9 million against the lease accruals over the next twelve months. Teradyne’s future lease commitments are net of expected sublease income of $0.3 million as of July 1, 2012. The table below represents activity related to these actions.

	Severance and Benefits			Facility Exit Costs			Total
	(in thousands)
Pre-2011 Activities
Balance at December 31, 2010	$	712		$	3,263		$	3,975
Provision		117			—			117
Change in estimate		155			(485	)		(330	)
Cash payments		(984	)		(916	)		(1,900	)
Balance at December 31, 2011		—			1,862			1,862
Cash payments		—			(189	)		(189	)
Balance at April 1, 2012		—			1,673			1,673
Cash payments		—			(209	)		(209	)
Balance at July 1, 2012	$	—		$	1,464		$	1,464
2011 Activities
Q1 2011 Activity:
Provision	$	572		$	—		$	572
Cash payments		(476	)		—			(476	)
Balance at December 31, 2011		96			—			96
Cash payments		(96	)		—			(96	)
Balance at April 1, 2012	$	—		$	—		$	—
Q2 2011 Activity:
Provision	$	344		$	—		$	344
Cash payments		(115	)		—			(115	)
Balance at December 31, 2011		229			—			229
Cash payments		(229	)		—			(229	)
Balance at April 1, 2012	$	—		$	—		$	—
2012 Activities
Q2 2012 Activity:
Provision	$	286		$	—		$	286
Balance at July 1, 2012	$	286		$	—		$	286
Balance at July 1, 2012	$	286		$	1,464		$	1,750

During the six months ended July 1, 2012, Teradyne recorded the following restructuring charges:

Q2 2012 Action:

• $0.3 million of severance charges related to headcount reductions of 10 people in Semiconductor Test.

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During the six months ended July 3, 2011, Teradyne recorded the following restructuring charges:

Q2 2011 Action:

• $0.3 million of severance charges related to headcount reductions of 2 people in Semiconductor Test.

Q1 2011 Action:

• $0.6 million of severance charges related to headcount reductions of 5 people in Semiconductor Test.

Pre-2011 Actions:

• $(0.5) million related to changes in the estimated exit costs related to the Westford, MA and Poway, CA facilities in Systems Test Group, and the North Reading, MA facility in Semiconductor Test and Systems Test Group.

N. Retirement Plans

Defined Benefit Pension Plans

Teradyne has defined benefit pension plans covering a portion of domestic employees and employees of certain non-U.S. subsidiaries. Benefits under these plans are based on employees’ years of service and compensation. Teradyne’s funding policy is to make contributions to these plans in accordance with local laws and to the extent that such contributions are tax deductible. The assets of these plans consist primarily of fixed income and equity securities. In addition, Teradyne has an unfunded supplemental executive defined benefit plan in the United States to provide retirement benefits in excess of levels allowed by the Employment Retirement Income Security Act (“ERISA”) and the Internal Revenue Code (“IRC”), as well as unfunded foreign plans.

Components of net periodic pension cost for all plans were as follows:

	For the Three Months Ended						For the Six Months Ended
	July 1,  2012			July 3,  2011			July 1,  2012			July 3,  2011
	(in thousands)
Service cost	$	643		$	668		$	1,357		$	1,436
Interest cost		4,125			4,457			8,185			8,784
Expected return on plan assets		(4,082	)		(3,906	)		(8,164	)		(7,818	)
Amortization of unrecognized prior service cost		58			155			116			310
Settlement		—			680			—			680
Actuarial loss		3,146			4,279			3,146			4,279
Total net periodic pension cost	$	3,890		$	6,333		$	4,640		$	7,671

In the six months ended July 1, 2012, Teradyne contributed $1.8 million to its defined benefit pension plans.

Post-Retirement Benefit Plans

In addition to receiving pension benefits, U.S. Teradyne employees who meet early retirement eligibility requirements as of their termination dates may participate in Teradyne’s Welfare Plan, which includes death, and medical and dental benefits up to age 65. Death benefits provide a fixed sum to retirees’ survivors and are available to all retirees. Substantially all of Teradyne’s current U.S. employees could become eligible for these benefits, and the existing benefit obligation relates primarily to those employees.

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Components of net periodic post-retirement cost were as follows:

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
	(in thousands)
Service cost	$	15		$	14		$	34		$	30
Interest cost		108			134			219			270
Amortization of unrecognized prior service benefit		(150	)		(150	)		(299	)		(299	)
Actuarial gain		(92	)		(76	)		(92	)		(76	)
Total net periodic post-retirement cost	$	(119	)	$	(78	)	$	(138	)	$	(75	)

O. Commitments and Contingencies

Purchase Commitments

As of July 1, 2012, Teradyne had entered into purchase commitments for certain components and materials. The purchase commitments aggregate to approximately $281.4 million, of which $280.0 million is for less than one year.

Legal Claims

Teradyne is subject to various legal proceedings and claims which have arisen in the ordinary course of business. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on Teradyne’s results of operations, financial condition or cash flows.

P. Segment Information

Teradyne has three operating segments (Semiconductor Test, Systems Test Group and Wireless Test), which are its reportable segments. The Semiconductor Test segment includes operations related to the design, manufacturing and marketing of semiconductor test products and services. The Systems Test Group segment includes operations related to design, manufacturing and marketing of products and services for military/aerospace instrumentation test, storage test and circuit-board test. The Wireless Test segment includes operations related to design, manufacturing and marketing of wireless test products and services. Each operating segment has a segment manager who is directly accountable to and maintains regular contact with Teradyne’s chief operating decision maker (Teradyne’s chief executive officer) to discuss operating activities, financial results, forecasts, and plans for the segment.

25

Teradyne evaluates performance based on several factors, of which the primary financial measure is business segment income before income taxes. The accounting policies of the business segments are the same as those described in Note B “Accounting Policies” in Teradyne’s Annual Report on Form 10-K for the year ended December 31, 2011. Segment information is as follows:

	Semiconductor Test		Systems Test Group		Wireless Test		Corporate and Eliminations			Consolidated
	(in thousands)
Three months ended July 1, 2012:
Net revenues	$	365,058	$	71,298	$	111,928	$	—		$	548,284
Income (loss) from continuing operations before income taxes(1)(2)		91,249		11,628		51,139		(2,024	)		151,992
Three months ended July 3, 2011:
Net revenues	$	343,096	$	67,423	$	—	$	—		$	410,519
Income (loss) from continuing operations before income taxes(1)(2)		90,973		8,823		—		(3,873	)		95,923
Six months ended July 1, 2012:
Net revenues	$	632,646	$	169,050	$	143,256	$	—		$	944,952
Income (loss) from continuing operations before income taxes(1)(2)		126,247		33,606		38,827		(5,444	)		193,236
Six months ended July 3, 2011:
Net revenues	$	662,346	$	125,334	$	—	$	—		$	787,680
Income (loss) from continuing operations before income taxes(1)(2)		167,900		14,314		—		(10,867	)		171,347

(1) Pension and post retirement actuarial gains and losses, interest income, and interest expense and other are included in Corporate and Eliminations.

(2) Included in the income (loss) from continuing operations before income taxes for each of the segments are charges and credits for the three and six months ended July 1, 2012 and July 3, 2011 that include restructuring and other, net, and provision for excess and obsolete inventory, as follows:

Included in the Semiconductor Test segment are charges for the following:

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Cost of revenues—provision for excess and obsolete inventory	$	5,957	$	1,500	$	6,169	$	5,942
Restructuring and other, net		286		1,279		286		2,170
Total	$	6,243	$	2,779	$	6,455	$	8,112

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Included in the Systems Test Group segment are charges and credits for the following:

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Cost of revenues—provision for excess and obsolete inventory	$	1,753	$	216	$	2,642	$	401
Restructuring and other, net		—		—		—		(246	)
Total	$	1,753	$	216	$	2,642	$	155

Included in the Wireless Test segment are charges for the following:

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Cost of revenues—inventory step-up	$	1,218	$	—	$	6,089	$	—
Cost of revenues—provision for excess and obsolete inventory		1,643		—		2,116		—
Total	$	2,861	$	—	$	8,205	$	—

Included in Corporate and Eliminations are credits for the following:

	For the Three Months Ended					For the Six Months Ended
	July 1,  2012			July 3,  2011		July 1,  2012			July 3,  2011
	(in thousands)
Restructuring and other, net	$	(6,548	)	$	—	$	(8,406	)	$	(232	)
Total	$	(6,548	)	$	—	$	(8,406	)	$	(232	)

Q. Stock Repurchase Program

In November 2010, Teradyne’s board of directors authorized a stock repurchase program for up to $200 million. In the three and six months ended July 1, 2012 and July 3, 2011, Teradyne did not repurchase any shares. Cumulatively, as of July 1, 2012, Teradyne has repurchased 2.6 million shares of common stock for $31.2 million at an average price of $11.84.

27

Item 2: Management’s Discussion and Analysis of Financial Condition and Results of Operations

Statements in this Quarterly Report on Form 10-Q which are not historical facts, so called “forward looking statements,” are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934, as amended. Investors are cautioned that all forward looking statements involve risks and uncertainties, including those detailed in Teradyne’s filings with the Securities and Exchange Commission. See also Part II, Item 1A of this Quarterly Report on Form 10-Q and Part I, Item 1A “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2011. Readers are cautioned not to place undue reliance on these forward-looking statements which reflect management’s analysis only as of the date hereof. We assume no obligation to update these forward-looking statements to reflect actual results or changes in factors or assumptions affecting forward-looking statements, except as may be required by law.

Overview

We are a leading global supplier of automatic test equipment. We design, develop, manufacture, and sell automatic test systems and solutions used to test complex electronics in the consumer electronics, automotive, computing, telecommunications, wireless, and aerospace and defense industries. Our automatic test equipment products and services include:

• semiconductor test (“Semiconductor Test”) systems,

• military/aerospace (“Mil/Aero”) test instrumentation and systems, storage test (“Storage Test”) systems, and circuit-board test and inspection (“Commercial Board Test”) systems (collectively these products represent “Systems Test Group”), and

• wireless test (“Wireless Test”) systems.

We have a broad customer base which includes integrated device manufacturers (“IDMs”), outsourced semiconductor assembly and test providers (“OSATs”), wafer foundries, fabless companies that design, but contract with others for the manufacture of integrated circuits (“ICs”), developers of wireless devices and consumer electronics, manufacturers of circuit boards, automotive suppliers, wireless product manufacturers, storage device manufacturers, aerospace and military contractors as well as the United States Department of Defense.

The sales of our products and services are dependent, to a large degree, on customers who are subject to fluctuating and seasonal demand for their products. This market dynamic has had, and will continue to have, a significant effect on our business since our customers often delay or accelerate purchases in reaction to changes in their businesses and to demand fluctuations in the semiconductor and electronics industries.

We believe our acquisitions of Nextest, Eagle Test and LitePoint, and our entry into the high speed memory and storage test markets have enhanced our opportunities for growth. We will continue to invest in our businesses to expand further our addressable markets while tightly managing our costs.

We regularly face price competition in each of our businesses from competitors. We intend to respond to competitive pricing moves as necessary, which may adversely impact our gross margins. Longer term, we will continue to invest in engineering to lower the cost of test which should help mitigate the impacts from aggressive pricing actions.

Critical Accounting Policies and Estimates

We have identified the policies which are critical to understanding our business and our results of operations. Except as noted below, there have been no significant changes during the six months ended July 1, 2012 to the items disclosed as our critical accounting policies and estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the fiscal year ended December 31, 2011.

28

Effective January 1, 2012, we changed the method of recognizing actuarial gains and losses for our defined benefit pension plans and postretirement benefit plan and calculating the expected return on plan assets for our defined benefit pension plans. Historically, we recognized net actuarial gains and losses in accumulated other comprehensive income within shareholders’ equity on our consolidated balance sheets on an annual basis and amortized them into operating results over the average remaining years of service of the plan participants, to the extent such gains and losses were outside of a corridor. We have elected to immediately recognize net actuarial gains and losses and the change in the fair value of the plan assets in our operating results in the year in which they occur or upon any interim remeasurement of the plans. In addition, we used to calculate the expected return on plan assets using a calculated market-related value of plan assets. We have also elected to calculate the expected return on plan assets using the fair value of the plan assets.

We believe that this new method is preferable as it eliminates the delay in recognizing gains and losses in our operating results and it will improve the transparency by faster recognition of the effects of economic and interest rate trends on plan obligations and investments. These actuarial gains and losses are generally measured annually as of December 31 and, accordingly, will be recorded during the fourth quarter of each year or upon any interim remeasurement of the plans. In accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 250, Accounting Changes and Error Corrections, all prior periods presented in this Quarterly Report on Form 10-Q have been adjusted to apply the new accounting method retrospectively. This accounting change did not impact the financial position of the reportable segments.

29

SELECTED RELATIONSHIPS WITHIN THE CONDENSED CONSOLIDATED

STATEMENTS OF OPERATIONS

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
Percentage of total net revenues:
Net revenues:
Products		88	%		83	%		86	%		83	%
Services		12			17			14			17
Total net revenues		100			100			100			100
Cost of revenues:
Cost of products		38			39			40			40
Cost of services		6			9			7			8
Total cost of revenues		44			48			47			48
Gross profit		56			52			53			52
Operating expenses:
Engineering and development		12			12			13			12
Selling and administrative		13			14			15			15
Acquired intangible asset amortization		3			2			4			2
Restructuring and other, net		(1	)		—			(1	)		—
Total operating expenses		28			28			31			29
Income from operations		29			24			22			23
Interest income		—			—			—			—
Interest expense and other		(1	)		(1	)		(1	)		(1	)
Income from continuing operations before income taxes		28			23			20			22
Income tax provision		7			2			5			2
Income from continuing operations		20			21			15			20
Income from discontinued operations before income taxes		—			—			—			—
Income tax benefit		—			—			—			—
Income from discontinued operations		—			—			—			—
(Loss) Gain on disposal of discontinued operations		—			—			—			3
Net income		20	%		21	%		15	%		23	%

Results of Operations

Second Quarter 2012 Compared to Second Quarter 2011

Book to Bill Ratio

Book to bill ratio is calculated as net bookings divided by net sales. Book to bill ratio by reportable segment was as follows:

	For the Three Months Ended
	July 1, 2012		July 3, 2011
Semiconductor Test		1.0		0.8
Systems Test Group		0.6		1.1
Wireless Test		1.7		—
Total Company		1.1		0.8

30

Revenues

Net revenues by reportable segments were as follows:

	For the Three Months Ended				Dollar Change
	July 1, 2012		July 3, 2011
	(in millions)
Semiconductor Test	$	365.1	$	343.1	$	22.0
Systems Test Group		71.3		67.4		3.9
Wireless Test		111.9		—		111.9
	$	548.3	$	410.5	$	137.8

The increase of $22.0 million or 6% in Semiconductor Test revenue was due to an increase in System-on-a-Chip product revenue partially offset by a decrease in memory product revenue. The increase in Systems Test Group revenue of $3.9 million or 6% was primarily due to an increase in sales of Mil/Aero test instrumentation, systems and services. The acquisition of LitePoint, which is our Wireless Test segment, completed in October of 2011, added $111.9 million of revenue in the three months ended July 1, 2012.

Our revenues by region as a percentage of total net revenue were as follows:

	For the Three Months Ended
	July 1, 2012			July 3, 2011
Taiwan		23	%		12	%
China		18			11
United States		12			15
Korea		12			15
Philippines		8			11
Hong Kong		6			—
Malaysia		5			6
Singapore		5			6
Europe		4			8
Japan		4			7
Thailand		3			8
Rest of World		—			1
		100	%		100	%

Gross Profit

Our gross profit was as follows:

	For the Three Months Ended						Dollar/Point Change
	July 1, 2012			July 3, 2011
	(in millions)
Gross Profit	$	309.5		$	214.7		$	94.8
Percent of Total Revenue		56.4	%		52.3	%		4.1

Gross profit as a percent of revenue increased by 4.1 percentage points as a result of an increase of 5.0 points due to the addition of LitePoint, which had its highest quarterly revenue in its history, partially offset by a decrease of 1.5 points due to higher inventory provisions.

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We assess the carrying value of our inventory on a quarterly basis by estimating future demand and comparing that demand against on-hand and on-order inventory positions. Forecasted revenue information is obtained from the sales and marketing groups and incorporates factors such as backlog and future revenue demand. This quarterly process identifies obsolete and excess inventory. Obsolete inventory, which represents items for which there is no demand, is fully reserved. Excess inventory, which represents inventory items that are not expected to be consumed during the next four quarters, is written-down to estimated net realizable value.

During the three months ended July 1, 2012, we recorded an inventory provision of $9.4 million included in cost of revenues, due to the following factors:

• A decline in demand versus previously forecasted demand levels for a prior generation Nextest Magnum resulted in an inventory provision of $3.2 million.

• A $2.6 million inventory write-down as a result of product transition related to the Flex Test Platform in Semiconductor Test.

• The remainder of the charge of $3.6 million primarily reflects downward revisions to previously forecasted demand levels, of which $1.8 million was related to Systems Test Group, $1.6 million was related to Wireless Test and $0.2 million was related to Semiconductor Test.

During the three months ended July 3, 2011, we recorded an inventory provision of $1.7 million included in cost of revenues, due to the downward revisions to previously forecasted demand levels. Of the $1.7 million of total excess and obsolete provisions recorded in the three months ended July 3, 2011, $1.5 million was related to Semiconductor Test and $0.2 million was related to Systems Test Group.

During the three months ended July 1, 2012 and July 3, 2011, we scrapped $2.8 million and $2.2 million of inventory, respectively. During the three months ended July 3, 2011, we sold $0.8 million of previously written-down or written-off inventory. As of July 1, 2012, we had inventory related reserves for amounts which had been written-down or written-off totaling $128.2 million. We have no pre-determined timeline to scrap the remaining inventory.

Engineering and Development

Engineering and development expenses were as follows:

	For the Three Months Ended						Dollar Change
	July 1, 2012			July 3, 2011
	(in millions)
Engineering and Development	$	66.5		$	48.4		$	18.1
Percent of Total Revenue		12.1	%		11.8	%

The increase of $18.1 million in engineering and development expenses is due primarily to additional costs of $9.6 million related to LitePoint which was acquired in October 2011 and increased spending on engineering projects.

32

Selling and Administrative

Selling and administrative expenses were as follows:

	For the Three Months Ended						Dollar Change
	July 1, 2012			July 3, 2011
	(in millions)
Selling and Administrative	$	73.4		$	57.9		$	15.5
Percent of Total Revenue		13.4	%		14.1	%

The increase of $15.5 million in selling and administrative expenses is due primarily to additional costs of $12.3 million related to LitePoint.

Restructuring and Other, Net

Other

During the three months ended July 1, 2012, due to a decrease in specified new product revenue through the December 31, 2012 earnout period end date, we recorded a $6.5 million fair value adjustment to decrease the LitePoint acquisition contingent consideration. As of July 1, 2012, the estimated undiscounted range of outcomes for the contingent consideration is $56.0 million to $58.0 million.

During the three months ended July 3, 2011, Teradyne recorded a $0.7 million charge related to a non-U.S. pension settlement.

Restructuring

In response to a downturn in the industry in 2008 and 2009, we initiated restructuring activities across all segments to reduce costs, principally through headcount reductions and facility consolidations. The remaining accrual for lease payments on vacated facilities of $1.5 million is reflected in the other accrued liabilities account and the long-term other accrued liabilities account and is expected to be paid over the lease terms, the latest of which expires in 2013. We expect to pay approximately $0.9 million against the lease accruals over the next twelve months. Our future lease commitments are net of expected sublease income of $0.3 million as of July 1, 2012. The table below represents activity related to these actions.

33

	Severance and Benefits			Facility Exit Costs			Total
	(in thousands)
Pre-2011 Activities
Balance at December 31, 2010	$	712		$	3,263		$	3,975
Provision		117			—			117
Change in estimate		155			(485	)		(330	)
Cash payments		(984	)		(916	)		(1,900	)
Balance at December 31, 2011		—			1,862			1,862
Cash payments		—			(189	)		(189	)
Balance at April 1, 2012		—			1,673			1,673
Cash payments		—			(209	)		(209	)
Balance at July 1, 2012	$	—		$	1,464		$	1,464
2011 Activities
Q1 2011 Activity:
Provision	$	572		$	—		$	572
Cash payments		(476	)		—			(476	)
Balance at December 31, 2011		96			—			96
Cash payments		(96	)		—			(96	)
Balance at April 1, 2012	$	—		$	—		$	—
Q2 2011 Activity:
Provision	$	344		$	—		$	344
Cash payments		(115	)		—			(115	)
Balance at December 31, 2011		229			—			229
Cash payments		(229	)		—			(229	)
Balance at April 1, 2012	$	—		$	—		$	—
2012 Activities
Q2 2012 Activity:
Provision	$	286		$	—		$	286
Balance at July 1, 2012	$	286		$	—		$	286
Balance at July 1, 2012	$	286		$	1,464		$	1,750

During the three months ended July 1, 2012, we recorded the following restructuring charges:

Q2 2012 Action:

• $0.3 million of severance charges related to headcount reductions of 10 people in Semiconductor Test.

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During the three months ended July 3, 2011, we recorded the following restructuring charges:

Q2 2011 Action:

• $0.3 million of severance charges related to headcount reductions of 2 people in Semiconductor Test.

Q1 2011 Action:

• $0.6 million of severance charges related to headcount reductions of 5 people in Semiconductor Test.

Pre-2011 Actions:

• $(0.5) million related to changes in the estimated exit costs related to the Westford, MA and Poway, CA facilities in Systems Test Group, and the North Reading, MA facility in Semiconductor Test and Systems Test Group.

Interest and Other

Interest income decreased by $0.5 million, from the second quarter of 2011 to 2012, due to a decrease in marketable securities due to the LitePoint acquisition. Interest expense and other increased by $1.0 million from second quarter of 2011 to 2012, due primarily to an increase in interest expense related to our convertible note.

Income Taxes

For the three months ended July 1, 2012, we recorded a tax provision of $40.6 million from continuing operations, which consisted of foreign taxes and U.S. deferred tax provision. For the three months ended July 3, 2011, we recorded a tax provision of $7.8 million from continuing operations, which consisted primarily of foreign taxes.

On a quarterly basis, we evaluate the realizability of our deferred tax assets by jurisdiction and assess the need for a valuation allowance. At July 1, 2012, we believe that we will ultimately realize the deferred tax assets recorded on our condensed consolidated balance sheet. However, should we believe that it is more likely than not that our deferred tax assets would not be realized, our tax provision would increase in the period in which we determined that the realizability was not likely. We consider the probability of future taxable income and our historical profitability, among other factors, in assessing the realizability of our deferred tax assets.

Six Months of 2012 Compared to Six Months of 2011

Revenues

Net revenues by reportable segments were as follows:

	For the Six Months Ended				Dollar Change
	July 1, 2012		July 3, 2011
	(in millions)
Semiconductor Test	$	632.6	$	662.3	$	(29.7	)
Systems Test Group		169.1		125.4		43.7
Wireless Test		143.3		—		143.3
	$	945.0	$	787.7	$	157.3

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The decrease of $29.7 million or 4% in Semiconductor Test revenue was primarily due to a decrease in memory product revenue, partially offset by an increase in System-on-a-Chip product revenue. The increase in Systems Test Group revenue of $43.7 million or 35% was primarily due to an increase in sales of Storage Test systems. The acquisition of LitePoint, which is our Wireless Test segment, completed in October of 2011, added $143.3 million of revenue in the six months ended July 1, 2012.

Our revenues by region as a percentage of total net revenue were as follows:

	For the Six Months Ended
	July 1, 2012			July 3, 2011
Taiwan		19	%		13	%
China		15			9
Korea		13			13
United States		12			14
Philippines		7			12
Thailand		7			6
Japan		6			7
Malaysia		5			11
Europe		5			7
Singapore		5			6
Hong Kong		5			—
Rest of World		1			2
		100	%		100	%

Gross Profit

Our gross profit was as follows:

	For the Six Months Ended						Dollar/Point Change
	July 1, 2012			July 3, 2011
	(in millions)
Gross Profit	$	500.4		$	407.6		$	92.8
Percent of Total Revenue		53.0	%		51.7	%		1.3

Gross profit as a percent of revenue increased by 1.3 percentage points a result of an increase of 3.5 points related to the addition of LitePoint, which had its highest six month revenue in its history, partially offset by a decrease of 2.2 points due to System-on-a-Chip product mix and higher Storage Test system sales.

We assess the carrying value of our inventory on a quarterly basis by estimating future demand and comparing that demand against on-hand and on-order inventory positions. Forecasted revenue information is obtained from the sales and marketing groups and incorporates factors such as backlog and future revenue demand. This quarterly process identifies obsolete and excess inventory. Obsolete inventory, which represents items for which there is no demand, is fully reserved. Excess inventory, which represents inventory items that are not expected to be consumed during the next four quarters, is written-down to estimated net realizable value.

During the six months ended July 1, 2012, we recorded an inventory provision of $10.9 million included in cost of revenues, due to the following factors:

• A decline in demand versus previously forecasted demand levels for a prior generation Nextest Magnum resulted in an inventory provision of $3.2 million.

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• A $2.6 million inventory write-down as a result of product transition related to the Flex Test Platform in Semiconductor Test.

• The remainder of the charge of $5.1 million primarily reflects downward revisions to previously forecasted demand levels, of which $2.6 million was related to Systems Test Group, $2.1 million was related to Wireless Test and $0.4 million was related to Semiconductor Test.

During the six months ended July 3, 2011, we recorded an inventory provision of $6.3 million included in cost of revenues, due to the downward revisions to previously forecasted demand levels. Of the $6.3 million of total excess and obsolete provisions recorded in the six months ended July 3, 2011, $5.9 million was related to Semiconductor Test and $0.4 million was related to Systems Test Group.

During the six months ended July 1, 2012 and July 3, 2011, we scrapped $6.9 million and $2.6 million of inventory, respectively. During the six months ended July 1, 2012 and July 3, 2011, we sold $1.3 million and $3.8 million, respectively, of previously written-down or written-off inventory. As of July 1, 2012, we had inventory related reserves for amounts which had been written-down or written-off totaling $128.2 million. We have no pre-determined timeline to scrap the remaining inventory.

Engineering and Development

Engineering and development expenses were as follows:

	For the Six Months Ended						Dollar Change
	July 1, 2012			July 3, 2011
	(in millions)
Engineering and Development	$	126.7		$	95.5		$	31.2
Percent of Total Revenue		13.4	%		12.1	%

The increase of $31.2 million in engineering and development expenses is due primarily to additional costs of $18.2 million related to LitePoint which was acquired in October 2011 and increased spending on engineering projects.

Selling and Administrative

Selling and administrative expenses were as follows:

	For the Six Months Ended						Dollar Change
	July 1, 2012			July 3, 2011
	(in millions)
Selling and Administrative	$	141.1		$	115.6		$	25.5
Percent of Total Revenue		14.9	%		14.7	%

The increase of $25.5 million in selling and administrative expenses is due primarily to additional costs of $23.0 million related to LitePoint.

Restructuring and Other, Net

Other

During the six months ended July 1, 2012, due to a decrease in specified new product revenue through the December 31, 2012 earn-out period end date, we recorded an $8.4 million fair value adjustment to decrease the LitePoint acquisition contingent consideration. As of July 1, 2012, the estimated undiscounted range of outcomes

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for the contingent consideration is $56.0 million to $58.0 million. The decrease in the range from December 31, 2011 is due to the $5.8 million contingent consideration payment during the six months ended July 1, 2012 and the $8.4 million fair value decrease.

During the six months ended July 3, 2011, Teradyne recorded a $0.7 million charge related to a non-U.S. pension settlement.

Restructuring

In response to a downturn in the industry in 2008 and 2009, we initiated restructuring activities across all segments to reduce costs, principally through headcount reductions and facility consolidations. The remaining accrual for lease payments on vacated facilities of $1.5 million is reflected in the other accrued liabilities account and the long-term other accrued liabilities account and is expected to be paid over the lease terms, the latest of which expires in 2013. We expect to pay approximately $0.9 million against the lease accruals over the next twelve months. Our future lease commitments are net of expected sublease income of $0.3 million as of July 1, 2012. The table below represents activity related to these actions.

	Severance and Benefits			Facility Exit Costs			Total
	(in thousands)
Pre-2011 Activities
Balance at December 31, 2010	$	712		$	3,263		$	3,975
Provision		117			—			117
Change in estimate		155			(485	)		(330	)
Cash payments		(984	)		(916	)		(1,900	)
Balance at December 31, 2011		—			1,862			1,862
Cash payments		—			(189	)		(189	)
Balance at April 1, 2012		—			1,673			1,673
Cash payments		—			(209	)		(209	)
Balance at July 1, 2012	$	—		$	1,464		$	1,464
2011 Activities
Q1 2011 Activity:
Provision	$	572		$	—		$	572
Cash payments		(476	)		—			(476	)
Balance at December 31, 2011		96			—			96
Cash payments		(96	)		—			(96	)
Balance at April 1, 2012	$	—		$	—		$	—
Q2 2011 Activity:
Provision	$	344		$	—		$	344
Cash payments		(115	)		—			(115	)
Balance at December 31, 2011		229			—			229
Cash payments		(229	)		—			(229	)
Balance at April 1, 2012	$	—		$	—		$	—
2012 Activities
Q2 2012 Activity:
Provision	$	286		$	—		$	286
Balance at July 1, 2012	$	286		$	—		$	286
Balance at July 1, 2012	$	286		$	1,464		$	1,750

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During the six months ended July 1, 2012, we recorded the following restructuring charges:

Q2 2012 Action:

• $0.3 million of severance charges related to headcount reductions of 10 people in Semiconductor Test.

During the six months ended July 3, 2011, we recorded the following restructuring charges:

Q2 2011 Action:

• $0.3 million of severance charges related to headcount reductions of 2 people in Semiconductor Test.

Q1 2011 Action:

• $0.6 million of severance charges related to headcount reductions of 5 people in Semiconductor Test.

Pre-2011 Actions:

• $(0.5) million related to changes in the estimated exit costs related to the Westford, MA and Poway, CA facilities in Systems Test Group, and the North Reading, MA facility in Semiconductor Test and Systems Test Group.

Interest and Other

Interest income decreased by $0.9 million, from the first six months of 2011 to 2012, due to a decrease in marketable securities due to the LitePoint acquisition. Interest expense and other increased by $0.9 million for the first six months of 2011 to 2012, due primarily to an increase in interest expense related to our convertible note.

Income Taxes

For the six months ended July 1, 2012, we recorded a tax provision of $48.3 million, from continuing operations, which consisted of foreign taxes and U.S. deferred tax provision. For the six months ended July 3, 2011, we recorded a tax provision of $13.3 million from continuing operations, which consisted primarily of foreign taxes.

On a quarterly basis, we evaluate the realizability of our deferred tax assets by jurisdiction and assess the need for a valuation allowance. At July 1, 2012, we believe that we will ultimately realize the deferred tax assets recorded on our condensed consolidated balance sheet. However, should we believe that it is more likely than not that our deferred tax assets would not be realized, our tax provision would increase in the period in which we determined that the realizability was not likely. We consider the probability of future taxable income and our historical profitability, among other factors, in assessing the realizability of our deferred tax assets.

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Contractual Obligations

The following table reflects our contractual obligations as of July 1, 2012:

	Payments Due by Period
	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years		Other
	(in thousands)
Long-Term Debt Obligations (1)	$	195,043	$	2,522	$	192,521	$	—	$	—	$	—
Interest on Debt		17,235		8,635		8,600		—		—		—
Contingent Acquisition Payments		54,662		54,662		—		—		—		—
Operating Lease Obligations		52,221		13,998		19,574		10,117		8,532		—
Purchase Obligations		281,360		279,760		1,600		—		—		—
Retirement Plan Contributions		52,928		5,174		10,570		11,206		25,978		—
Other Long-Term Liabilities Reflected on the Balance Sheet under GAAP (2)		80,496		—		22,303		—		—		58,193
Total	$	733,945	$	364,751	$	255,168	$	21,323	$	34,510	$	58,193

(1) Long-Term Debt Obligations include current maturities.

(2) Included in Other Long-Term Liabilities are liabilities for customer advances, extended warranty, uncertain tax positions and other obligations. For certain long-term obligations, we are unable to provide a reasonably reliable estimate of the timing of future payments relating to these obligations and therefore we included these amounts in the column marked “Other”.

Liquidity and Capital Resources

Our cash, cash equivalents and marketable securities balance increased by $74.1 million in the six months ended July 1, 2012, to $828.8 million. Cash activity for the six months ended July 1, 2012 and July 3, 2011 was as follows:

	For the Six Months Ended
	July 1, 2012			July 3, 2011
	(in millions)
Cash provided by operating activities:
Income from continuing operations, adjusted for non-cash items	$	255.2		$	227.7
Change in operating assets and liabilities, net of businesses sold		(141.9	)		(101.9	)
Cash used for discontinued operations		—			(4.2	)
Total cash provided by operating activities		113.3			121.6
Cash used for investing activities from continuing operations		(115.5	)		(122.5	)
Cash provided by investing activities from discontinued operations		—			39.1
Total cash used for investing activities		(115.5	)		(83.4	)
Total cash provided by financing activities		17.5			19.5
Increase in cash and cash equivalents	$	15.3		$	57.7

In the six months ended July 1, 2012, changes in operating assets and liabilities, net of businesses sold, used cash of $141.9 million. This was due to a $190.3 million increase in operating assets, partially offset by a $48.4 million increase in operating liabilities.

The increase in operating assets was due to a $216.8 million increase in accounts receivable due to higher sales volume, partially offset by a $21.4 million decrease in inventories, and $5.0 million decrease in other assets

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mainly due to a decrease in prepayments. The increase in operating liabilities was due to a $47.5 million increase in accounts payable due to increased sales volume, a $30.0 million increase in accrued income taxes, and $1.1 million increase in other accrued liabilities, partially offset by $21.4 million decrease in accrued employee compensation due primarily to variable compensation payments, a $6.2 million decrease in customer advance payments and deferred revenue and $2.6 million of retirement plan contributions.

Investing activities during the six months ended July 1, 2012 used cash of $115.5 million, due to $156.8 million used for purchases of marketable securities and $57.8 million used for purchases of property, plant and equipment, partially offset by proceeds from sales and maturities of marketable securities that provided cash of $39.7 million and $59.4 million, respectively.

Financing activities during the six months ended July 1, 2012 provided cash of $17.5 million, $16.9 million was from the issuance of common stock under stock option and stock purchase plans, and $7.6 million from the tax benefit related to stock options and restricted stock units, partially offset by $5.8 million of cash used for a payments related to LitePoint acquisition contingent consideration and $1.2 million of cash used for a payment on long-term debt.

In the six months ended July 3, 2011, changes in operating assets and liabilities, net of businesses sold, used cash of $101.9 million. This was due to a $64.4 million increase in operating assets and a $37.5 million decrease in operating liabilities.

The increase in operating assets was due to a $39.1 million increase in accounts receivable and a $15.0 million increase in inventories due to higher sales volume, and a $10.3 million increase in prepayments and other assets. The decrease in operating liabilities was due to a $44.0 million decrease in accrued employee compensation due primarily to variable compensation payments, a $26.9 million decrease in customer advance payments due to shipments of systems prepaid by customers, $5.2 million of retirement plan contributions, and a $1.4 million decrease in deferred revenue, partially offset by a $25.9 million increase in accounts payable due to increased sales volume and an $8.7 million increase in other accrued liabilities, and a $5.4 million increase in accrued income taxes.

Investing activities during the six months ended July 3, 2011 used cash of $122.5 million, due to $498.5 million used for purchases of marketable securities and $44.5 million used for purchases of property, plant and equipment, partially offset by proceeds from sales and maturities of marketable securities that provided cash of $54.3 million and $366.2 million, respectively.

Financing activities during the six months ended July 3, 2011 provided cash of $19.5 million, $17.0 million from the issuance of common stock under stock option and stock purchase plans, and $3.7 million from the tax benefit related to stock options and restricted stock units, partially offset by $1.2 million of cash used for a payment on long-term debt.

We believe our cash, cash equivalents and marketable securities balance will be sufficient to meet working capital and expenditure needs for at least the next twelve months. We do not have significant cash outside the U.S. that if repatriated would incur additional taxes. In addition, the amount of cash, cash equivalents and marketable securities in the U.S. and our operations in the U.S. provide sufficient liquidity to fund our business activities in the U.S. Inflation has not had a significant long-term impact on earnings.

Equity Compensation Plans

As discussed in Note N “Stock Based Compensation” in our 2011 Form 10-K, we have a 1996 Employee Stock Purchase Plan and a 2006 Equity and Cash Compensation Incentive Plan (the “2006 Equity Plan”).

The purpose of the 1996 Employee Stock Purchase Plan is to encourage stock ownership by all eligible employees of Teradyne. The purpose of the 2006 Equity Plan is to provide equity ownership and compensation opportunities in Teradyne to our employees, officers, directors, consultants and/or advisors. Both plans were approved by our shareholders.

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Recently Issued Accounting Pronouncements

In December 2011, the FASB issued ASU No. 2011-11, “Disclosures about Offsetting Assets and Liabilities.” This ASU is intended to enhance the understanding of the effects of netting arrangements on an entity’s financial statements, including financial instruments and derivative instruments that are either offset or subject to a master netting arrangement. The scope of this ASU includes derivatives, sale and repurchase agreements, reverse sale and repurchase agreements, and securities borrowing and lending arrangements. The provisions of this ASU are effective for interim and annual periods beginning on or after January 1, 2013.

Item 3: Quantitative and Qualitative Disclosures about Market Risk

For “Quantitative and Qualitative Disclosures about Market Risk” affecting Teradyne, see Item 7a. “Quantitative and Qualitative Disclosures about Market Risks,” in our Annual Report on Form 10-K filed with the SEC on February 29, 2012. There were no material changes in our exposure to market risk from those set forth in our Annual Report for the fiscal year ended December 31, 2011.

Item 4: Controls and Procedures

As of the end of the period covered by this report, our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15(b) promulgated under the Exchange Act. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective in ensuring that material information required to be disclosed in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, including ensuring that such material information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

During the period covered by this report, there have been no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

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PART II. OTHER INFORMATION

Item 1: Legal Proceedings

We are subject to various legal proceedings and claims which have arisen in the ordinary course of business. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on our results of operations, financial condition or cash flows.

Item 1A: Risk Factors

You should carefully consider the factors discussed in Part I, “Item 1A: Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2011, which could materially affect our business, financial condition or future results. The risk factors described in our Annual Report on Form 10-K remain applicable to our business.

The risks described in our Annual Report on Form 10-K are not the only risks that we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

Item 2: Unregistered Sales of Equity Securities and Use of Proceeds

In November 2010, Teradyne’s board of directors authorized a stock repurchase program for up to $200 million. Cumulatively, as of July 1, 2012, we have repurchased 2.6 million shares of common stock for $31.2 million at an average price of $11.84.

The following table includes information with respect to repurchases we made of our common stock during the three months ended July 1, 2012 (in thousands except per share price):

Period	(a) Total Number of Shares (or Units) Purchased		(b) Average Price Paid per Share (or Unit)		(c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs		(d) Maximum Number (or Approximate Dollar Value) of Shares (or Units) that may Yet Be Purchased Under the Plans or Programs
April 2, 2012 – April 29, 2012		—	$	—		—	$	168,825
April 30, 2012 –May 27, 2012		—	$	—		—	$	168,825
May 28, 2012 – July 1, 2012		—	$	—		—	$	168,825
		—	$	—		—	$	168,825

We satisfy the minimum withholding tax obligation due upon the vesting and the conversion of restricted stock units into shares of our common stock, by automatically withholding from the shares being issued a number of shares with an aggregate fair market value on the date of such vesting and conversion that would satisfy the withholding amount due.

The following table includes information with respect to our common stock shares withheld to satisfy withholding tax obligations during the three months ended July 1, 2012 (in thousands except per share price):

Period	(a) Total Number of Shares (or Units) Purchased		(b) Average Price Paid per Share (or Unit)		(c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs		(d) Maximum Number (or Approximate Dollar Value) of Shares (or Units) that may Yet Be Purchased Under the Plans or Programs
April 2, 2012 – April 29, 2012		3	$	16.99		—		—
April 30, 2012 –May 27, 2012		14	$	15.21		—		—
May 28, 2012 – July 1, 2012		1	$	13.61		—		—
		18	$	15.43		—		—

Item 4: Mine Safety Disclosures

Not Applicable

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Item 6: Exhibits

Exhibit Number	Description
10.1	Executive Officer Agreement dated June 29, 2012 between Teradyne, Inc. and Jeffrey Hotchkiss (filed herewith)
10.2	Executive Officer Change in Control Agreement dated June 30, 2012 between Teradyne, Inc. and Walter Vahey (filed herewith)
31.1	Certification of Principal Executive Officer, pursuant to Rule 13a-14(a) of Securities and Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)
31.2	Certification of Principal Financial Officer, pursuant to Rule 13a-14(a) of Securities and Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)
32.1	Certification pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
32.2	Certification pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
101.INS*	XBRL Instance Document
101.SCH*	XBRL Taxonomy Extension Schema Document
101.CAL*	XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*	XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*	XBRL Taxonomy Extension Label Linkbase Document
101.PRE*	XBRL Taxonomy Extension Presentation Linkbase Document

* XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, and otherwise is not subject to liability under these sections.

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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.

Registrant

/S/    GREGORY R. BEECHER

Gregory R. Beecher

Vice President,

Chief Financial Officer and Treasurer

(Duly Authorized Officer
and Principal Financial Officer)

August 10, 2012

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EX-10.1

Exhibit 10.1

EXECUTIVE OFFICER AGREEMENT

This EXECUTIVE OFFICER AGREEMENT is entered into this 29th day of June 2012, by and between Teradyne, Inc., a Massachusetts corporation (“Teradyne” or the “Company”), and the undersigned executive officer of Teradyne (“Executive”).

WITNESSETH:

WHEREAS, the Executive is retiring from the Company effective June 29, 2012 (the “Retirement Date”).

WHEREAS, Teradyne recognizes the contributions the Executive has made to the success of the Company and wishes to ensure the Executive is available to provide consulting to the Company and does not engage in any business competitive with the Company following his retirement for the period from the Retirement Date through January 27, 2016 (the “Non-Competition Period”).

WHEREAS, Teradyne and Executive desire to set forth certain terms and conditions relating to the Executive’s retirement from Teradyne.

NOW THEREFORE, in consideration of the promises and of the mutual covenants and agreements hereinafter set forth, the parties hereto hereby agree as follows:

1. Consulting.

In consideration of the benefits received under this Agreement, the Executive agrees to make himself reasonably available to provide consulting services to the Company as reasonably requested by the Company for up to one hundred and sixty (160) hours during each of the following three twelve (12) month periods of the Non-Competition Period: (a) June 30, 2012 through June 29, 2013; (b) June 30, 2013 through June 29, 2014; and June 30, 2014 through June 29, 2015. For the period from June 30, 2015 through January 27, 2016, the Executive will make himself available as above for up to ninety (90) hours. During the four periods enumerated above, if the Company does not avail itself of the specified number of consulting hours related to that period, the hours will not accumulate or roll over into any subsequent period. The Company will reimburse the Executive for any expenses he incurs in connection with the consulting, in accordance with the Company’s prevailing Travel and Entertainment Policy. In connection with the performance of any consulting services, the Executive shall maintain the confidentiality of any information provided by the Company, comply with the Company’s Code of Conduct and work as an independent contractor without any employment benefits that the Company makes available to its employees. The Executive hereby agrees that following the Retirement Date, he shall cease to be an employee of the Company.

2. Consideration for Consulting and Non-Competition.

In consideration for his consulting services, the signing of the Release attached as Attachment A as well as the promises and covenants including the Non-Competition and Non-Solicitation provision set forth herein, the Company agrees to the following treatment of the portions of the Executive’s outstanding equity grants which remain unvested as of the Retirement Date; provided that such treatment shall be subject to Section 3 hereof and full compliance by the Executive with Section 5 hereof:

a) Any unvested, time-based restricted stock units granted before 2012 shall continue to vest during the Non-Competition Period;

b) Any unvested, time-based restricted stock units granted in 2012 prior to the Retirement Date shall continue to vest during the Non-Competition Period in a pro-rated amount based on the number of days that the Executive was employed during 2012;

c) Any unvested stock options granted before 2012 shall continue to vest during the Non-Competition Period;

d) Any unvested stock options granted in 2012 prior to the Retirement Date shall continue to vest during the Non-Competition Period in a pro-rated amount based on the number of days that the Executive was employed during 2012;

e) Any vested stock options as of the Retirement Date or stock options that become vested during the Non-Competition Period may be exercised for the remainder of the generally applicable term of such option which in all cases is no later than seven years from the respective dates of grant;

f) Any previously granted unvested, performance-based restricted stock units for which the performance percentage has been determined by Teradyne’s Board of Directors and/or Compensation Committee as of the Retirement Date shall continue to vest during the Non-Competition Period; and

g) Any previously granted unvested, performance-based restricted stock units for which the performance percentage has not been determined by Teradyne’s Board of Directors and/or Compensation Committee as of the Retirement Date shall commence vesting at their target or 100% level on the first anniversary of their grant date in a pro-rated amount based on the number of days that the Executive was employed during the relevant performance period, and shall continue to vest during the Non-Competition Period.

Schedule A attached hereto and incorporated herein is a complete list of the Executive’s outstanding equity grants from the Company as of the Retirement Date. The parties agree that, except as otherwise provided herein, the terms of the Executive’s existing equity award agreements shall continue in effect and that any portion of the Executive’s outstanding equity

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grants which are not vested by reason of the application of Section 2(a), (b), (c), (d), (f) and (g) shall be forfeited as of the last day of the Non-Competition Period or on such earlier date pursuant to Section 5.

Executive acknowledges that he is not and would not be entitled to the consideration described in this Section 2 absent his execution and non-revocation of this Agreement and the release. The consideration described in this Section 2 is in addition to other retirement and/or pension benefits to which the Executive may be entitled associated with the Executive’s retirement. The parties acknowledge that Executive shall not be entitled to any severance or separation payment or benefit associated with his retirement, other than all accrued wages and unused vacation time as of the Retirement Date. The Executive acknowledges and agrees that his termination of employment with the Company shall not be considered a retirement for purposes of his unvested equity grants which are outstanding as of the Retirement Date and that the settlement or exercise of rights under such grants shall not be accelerated.

3. Conditions to Consideration.

The consideration and entitlements set forth above in Section 2 shall be conditioned on Executive’s signing, and not revoking, a Release, in the form attached as Attachment A, within twenty-one (21) days following the Retirement Date, plus any legally required revocation period.

4. Compensation in connection with Retirement.

Executive shall receive the following compensation in connection with his retirement:

a) Variable compensation payment for 2012 pro-rated to the Retirement Date paid in accordance with and at the time consistent with the Company’s standard practice;

b) Profit sharing payment, if any, for the first half of 2012 made in accordance with the Company’s standard practice; and

c) All other compensation and benefits to which the executive is currently entitled in connection with his employment or his retirement.

5. Non-Competition and Non-Solicitation.

During the Non-Competition Period, Executive shall not directly or indirectly:

a) Engage in any business or enterprise (whether as an owner, partner, officer, employee, executive, director, investor, lender, consultant, independent contractor or otherwise, except as the holder of not more than 1% of the combined voting power of the outstanding stock of a publicly held company) that is competitive with Teradyne (including but not limited to, any business or enterprise that develops, designs, produces, markets, sells or renders any product or service competitive with any product or service developed, produced, marketed, sold or rendered by Teradyne while Executive was employed by Teradyne);

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b) Either alone or in association with others, recruit, solicit, hire or engage as an independent contractor, any person who was employed by Teradyne at any time during the period of Executive’s employment with Teradyne, except for an individual whose employment with Teradyne has been terminated for a period of six months or longer; or

c) Either alone or in association with others, solicit, divert or take away, or attempt to divert or to take away, the business or patronage of any client or customer or entity that was a prospective client or customer of Teradyne during the Executive’s employment.

If any restriction set forth in this Section 5 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, the parties agree that it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable.

Executive acknowledges that the restrictions contained in this Section 5 are necessary for the protection of the business and goodwill of Teradyne and are considered by Executive to be reasonable for such purpose. Executive agrees that any breach of this Section 5 will cause Teradyne irreparable harm and therefore, in the event of any such breach, in addition to such other remedies that may be available, Teradyne shall have the right to seek equitable and/or injunctive relief.

The geographic scope of this Section 5 shall extend to anywhere Teradyne or any of its subsidiaries is doing business, has done business or has plans to do business.

Executive agrees that during the Non-Competition Period, he will make reasonable good faith efforts to give written notice to Teradyne of each new business activity he plans to undertake, at least (5) business days prior to beginning any such activity.

If Executive violates the provisions of this Section 5, Teradyne shall be entitled to discontinue any continued vesting per Section 2 above and Executive shall continue to be bound by the restrictions set forth in this Section 5 for an additional period of time equal to the duration of the violation, such additional period not to exceed 24 months.

6. Deferred Compensation/Section 409A.

Notwithstanding any other provision of this Agreement, if the Executive is a “specified employee” at the time of the Executive’s “separation from service” as such terms are defined in Section 409A of the Code, all payments, benefits, or removal of restrictions on the transfer of equity under this Agreement with respect to the Executive’s “separation from service” that constitute compensation deferred under a nonqualified deferred compensation plan as defined in Section 409A of the Code and regulations thereunder for which an exemption does not apply and

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to which such the Executive as a “specified employee” would otherwise be entitled during the first six months following the date of “separation from service” shall be made on the first day of the seventh month after the date of “separation from service” (or, if earlier, the date of death of the Executive).

For purposes of this Agreement, each amount to be paid or benefit to be provided shall be construed as a separate identified payment for purposes of Section 409A, and any payments that are due within the “short term deferral period” as defined in Section 409A and regulations thereunder or payments that are made under separation pay plans as described in Treasury Regulation Section 1.409A-1(b)(9)(ii), (iii) or (iv), shall not be treated as deferred compensation unless applicable law requires otherwise. Neither Teradyne nor the Executive shall have the right to accelerate or defer the delivery of any payments or benefits under this Agreement except to the extent specifically permitted or required by Section 409A.

This Agreement is intended to comply with the provisions of Section 409A and regulations thereunder and the Agreement shall, to the extent practicable, be construed and administered in accordance therewith. Terms defined in the Agreement shall have the meanings given such terms under Section 409A if and to the extent required to comply with Section 409A. In any event, Teradyne makes no representations or warranty and shall have no liability to the Executive or any other person if any provisions of or payments under this Agreement are determined to constitute deferred compensation subject to Code Section 409A but not to satisfy the conditions of that section.

7. Governing Law and Dispute Resolution.

This Agreement shall be governed by and construed in accordance with the internal laws of the Commonwealth of Massachusetts and this Agreement shall be deemed to be performable in Massachusetts. The Executive and the Company agree that any dispute, controversy or claim arising between the parties relating to this Agreement shall be resolved by final and binding arbitration before a single arbitrator, except that the parties may seek equitable relief in court to preserve the status quo pending final resolution in arbitration. The arbitrator shall be selected in accordance with the Employment Dispute Resolution rules of the American Arbitration Association (“AAA”) pertaining at the time the dispute arises. The parties agree that such arbitration shall take place at the offices of the AAA in Boston, Massachusetts. In such arbitration proceedings, the arbitrator shall have the discretion, to be exercised in accordance with applicable law, to award any damages permitted by law, and to allocate among the parties the arbitrator’s fees, tribunal and other administrative and litigation costs and, to the prevailing party, reasonable attorneys’ fees. The award of the arbitrator may be confirmed before and entered as a judgment of any court having jurisdiction of the parties.

8. Severability.

In case any one or more of the provisions contained in this Agreement for any reason shall be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement and this Agreement shall be construed to the maximum extent permitted by law.

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9. Waivers and Modifications.

This Agreement may be modified, and the rights, remedies and obligations contained in any provision hereof may be waived, only in accordance with this Section 9. No waiver by either party of any breach by the other or any provision hereof shall be deemed to be a waiver of any later or other breach thereof or as a waiver of any other provision of this Agreement. This Agreement may not be waived, changed, discharged or terminated orally or by any course of dealing between the parties, but only by an instrument in writing signed by the party against whom any waiver, change, discharge or termination is sought.

10. Assignment.

This Agreement, and Executive’s and Teradyne’s rights and obligations hereunder, may not be assigned by Executive or Teradyne; any purported assignment by Executive or Teradyne in violation hereof shall be null and void.

11. Entire Agreement.

This Agreement, including Schedule A and Attachment A, constitutes the entire understanding of the parties relating to the subject matter hereof and supersedes all agreements, written or oral, made prior to the date hereof between Executive and Teradyne relating to the subject matter hereof, except for the attached Release once executed, and the equity award agreements, as modified hereby, between Teradyne and Executive.

12. Notices.

All notices hereunder shall be in writing and shall be delivered in person or mailed by certified or registered mail, return receipt requested, addressed as follows:

If to Teradyne, to:	Teradyne, Inc.
	600 Riverpark Drive
	North Reading, MA 01864
	Attention: General Counsel

If to Executive, at Executive’s address in his employment file on record with the Human Resources Department.

13. Cooperation.

Executive agrees to cooperate fully with the Company in the defense or prosecution of any claims or actions now in existence or which may be brought in the future against or on behalf of the Company. The Executive’s full cooperation in connection with such claims or actions shall include, but not be limited to, being available to meet with Company counsel to prepare for trial or discovery or an administrative hearing or alternative dispute resolution and to act as a witness when requested by the Company at reasonable times designated by the Company.

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14. Return of Property.

No later than the Retirement Date, Executive shall return to the Company all Company property in his possession or control, including all electronic documents

15. Non-Disparagement.

The Executive understands and agrees that in consideration for the covenants, terms and conditions herein, he shall not make any false, disparaging or derogatory statements to any third person or entity, including any media outlet, in public or private regarding the Company’s directors, officers, executives, agents, or representatives or the Company’s business affairs and financial condition. The Company understands and agrees that in consideration for the covenants, terms and conditions herein, it shall cause its directors and executive officers to not make any false, disparaging or derogatory statements to any third party or entity, including any media outlet, in public or private, regarding the Executive.

16. Confidential Information

The Executive acknowledges that the information, observations and data (including trade secrets) obtained by him while employed by the Company concerning the Company or any affiliate are the property of the Company. The Executive agrees that he will not use, publish or disclose, at any time after the Retirement Date or in connection with his consulting services, any secret or confidential information or data concerning any discovery, invention, opportunity, product, design, formula, algorithm or process, or any secret or confidential production, sales or other business information, relating to the Company or any client, subsidiary or affiliate of the Company which he may acquire or have acquired during any period of employment with the Company or any affiliate. The term “confidential information” shall not include information that is in the public domain at the time of the disclosure. The Executive further agrees to turn over at or prior to the expiration of his employment all tangible forms of such information in his possession or under his control, including drawings, specifications, models, customer lists and other documents and records as well as all copies and reproductions thereof. Prior to or concurrent with any cessation of services hereunder, the Executive shall reduce to writing and deliver to the Company such information as the Company may reasonably request to the extent that such information pertains to the business and operations of the Company and its subsidiaries and affiliates and any product or service offered by the Company or its affiliates.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.

TERADYNE, INC.		EXECUTIVE
By:	/s/ Steve Fagerquist	/s/ Jeff Hotchkiss
Name:	Steve Fagerquist	Name:	Jeff Hotchkiss
Title:	VP, Human Resources

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EX-10.2

Exhibit 10.2

EXECUTIVE OFFICER CHANGE IN CONTROL AGREEMENT

EXECUTIVE OFFICER CHANGE IN CONTROL AGREEMENT entered into this 30th day of June, 2012 by and between Teradyne, Inc., a Massachusetts corporation (“Teradyne”), and the undersigned executive officer of Teradyne (“Employee”).

WITNESSETH:

WHEREAS, Teradyne and Employee desire to set forth certain terms and conditions relating to the termination of Employee’s employment upon the occurrence of a Change in Control (as hereinafter defined) of Teradyne.

NOW THEREFORE, in consideration of the premises and of the mutual covenants and agreements hereinafter set forth, the parties hereto hereby agree as follows:

1. Entitlements Upon a Termination Event. If, within twenty-four (24) months following a Change in Control or in contemplation of a Change in Control, there is a Termination Event, and subject to the conditions set forth herein and the performance by Employee of the undertakings and duties set forth herein, Employee shall be entitled to the rights, payments and other benefits set forth below:

(a) Treatment of Awards. Equity Awards that are not subject to Performance Criteria shall be governed by Section 1(b) below, and Cash Awards and Equity Awards that are subject to Performance Criteria shall be governed by Section 1(c) below. The parties hereto acknowledge that, except as otherwise provided herein, the terms of this Agreement are intended to modify the terms of Employee’s existing Cash Award and Equity Award agreements and to be a supplement to Cash Award and Equity Award agreements granted on or subsequent to the date hereof.

(b) Acceleration of Equity Awards. All of Employee’s unvested or unexercisable Equity Awards or Equity Awards subject to restrictions on transfer imposed by Teradyne or repurchase rights in favor of Teradyne, as applicable, granted prior to, on, or after the date hereof (but only (I) such Equity Awards as have been granted to Employee by Teradyne as of the date of the Change in Control or (II) such Equity Awards as have been assumed by an acquiring company at the time of a Change in Control or such new cash and equity awards that have been substituted by an acquiring company for Equity Awards existing at the time of a Change in Control, each pursuant to the terms of any Teradyne incentive plan) shall automatically become fully vested, exercisable or free of restrictions on transfer imposed by Teradyne or repurchase rights in favor of Teradyne, as applicable, as of the date of such Termination Event, and all Equity Awards granted on or after the date hereof shall, to the extent applicable, remain exercisable for the remainder of the generally applicable term of such Equity Award.

(c) Satisfaction of Performance Criteria. All of Employee’s Cash Awards and Equity Awards that are subject to Performance Criteria shall be settled and paid in the following

manner: Employee shall be deemed to have satisfied the necessary percentage of the Performance Criteria to which such Cash Awards and Equity Awards are subject as of the date of the Termination Event, that will provide Employee with the target level of such Cash Awards and Equity Awards; and Employee shall be entitled to receive that portion of each Cash Award and Equity Award payable, at the target level. For purposes of the Cash Awards, the payment shall be multiplied by a fraction, the numerator of which shall be the number of calendar months that have passed during the period in which the Performance Criteria are to be measured (treating the month in which the Termination Event occurs as a full calendar month) and the denominator of which shall be the total number of calendar months in such period. For purposes of this Agreement, “target level” is that percentage of the Performance Criteria established at the beginning of the calendar year in order for the Employee to achieve Model Compensation. Unless otherwise required under Section 1(e) below, such Cash Awards and Equity Awards shall be paid to Employee or the restrictions on transfer removed not later than 10 days following the Termination Event.

(d) Salary Continuation. Unless otherwise required under Section 1 (e) below, Teradyne shall pay Employee monthly an amount equal to 1/12^th of Employee’s current annual Model Compensation as of the Termination Event for a period of 24 months following the date of the Termination Event (the “Salary Continuation Period”). In the event a Termination Event constitutes termination for Good Reason on account of a material reduction in Model Compensation, the payment obligation pursuant to this Section 1(d) shall be calculated without giving effect to any such reductions in Model Compensation. All such continued payments shall be made in accordance with Teradyne’s customary pay practices.

(e) Deferred Compensation/Section 409A.

(i) Notwithstanding any other provision of this Agreement, if the Employee is a “ specified employee” at the time of the Employee’s “separation from service” as defined in Section 409A of the Code , all payments, benefits, or removal of restrictions on the transfer of equity under this Agreement with respect to the Employee’s “separation from service” that constitute compensation deferred under a nonqualified deferred compensation plan as defined in Section 409A of the Code to which such specified employee would otherwise be entitled during the first six months following the date of separation from service shall be made on the first day of the seventh month after the date of separation from service (or, if earlier, the date of death of the Employee).

(ii) For purposes of this Agreement, each amount to be paid or benefit to be provided shall be construed as a separate identified payment for purposes of Section 409A, and any payments that are due within the “short term deferral period” as defined in Section 409A or payments that are made under separation pay plans as described in Treasury Regulation Section 1.409A-1(b)(9)(ii), (iii) or (iv), shall not be treated as deferred compensation unless applicable law requires otherwise. Neither Teradyne nor the Employee shall have the right to accelerate or defer the delivery of any payments or benefits under this Agreement except to the extent specifically permitted or required by Section 409A.

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(iii) This Agreement is intended to comply with the provisions of Section 409A and the Agreement shall, to the extent practicable, be construed in accordance therewith. Terms defined in the Agreement shall have the meanings given such terms under Section 409A if and to the extent required to comply with Section 409A. In any event, Teradyne makes no representations or warranty and shall have no liability to Employee or any other person if any provisions of or payments under this Agreement are determined to constitute deferred compensation subject to Code Section 409A but not to satisfy the conditions of that section.

(iv) If any amount is payable under the provisions of paragraph (f), below, as a reimbursement of Employee’s expenses, under the provisions of Section 2 and 13, or any other provision of this Agreement that constitutes a reimbursement of expenses under Section 409A then, notwithstanding the other provisions of this Agreement with respect to the payment of such reimbursement, the following limitations shall apply; (A) the expenses eligible for reimbursement may not affect the expenses eligible for reimbursement in any other taxable year; (B) such reimbursement must be made on or before the last day of the year following the year in which the expenses are incurred; (C) the right to reimbursement is not subject to liquidation or exchange for another benefit; and (D) in connection with reimbursements under Section 13 the period during which such expenses can be incurred extends to the end of the period permitted for such claims under the applicable statute of limitations.

(f) Benefit Continuation. During the Salary Continuation Period, Teradyne shall arrange or provide for continued health, dental and vision insurance plan coverage for the Employee at the same levels of coverage in existence prior to the Termination Event subject to Teradyne and Employee each contributing to the applicable insurance premium payments on the same basis and in the same proportions as in existence at the date of the Termination Event. If the Employee is not eligible for continued health, dental and vision insurance plan coverage for any portion of the twenty-four (24) month period defined herein, Teradyne shall provide or reimburse Employee for comparable individual insurance and, if such provision or reimbursement constitutes taxable income to the Employee, such additional amount as is necessary to place the Employee in substantially the same after tax position as he was while an employee of Teradyne with respect to such insurance plan coverages. All other benefits, including but not limited to flex/vacation time accrual, short and long term disability insurance, life insurance, contributions (including company matches) into savings plan and “savings plan plus”, profit sharing payments and participation in the Employee stock purchase plan shall cease as of the date of the Termination Event.

To the extent that amounts paid by Teradyne to provide the benefits under this paragraph (f) are deemed to be deferred compensation subject to Section 409A, then such payments shall be made monthly and any payment to preserve the Employee’s after tax position shall be made within 60 days after the end of each calendar year in which the taxable provision or reimbursement occurs.

(g) Release. Notwithstanding any other provision of this Agreement to the contrary, no payment , benefit or removal of restriction on the transfer of equity provided for under or by virtue of the provisions of this Agreement shall be paid or otherwise made available unless Teradyne shall have first received from Employee a valid, binding and irrevocable general release, in the form of Attachment A to this Agreement within twenty-one (21) days of

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the date of the Termination Event; provided further that Teradyne shall be permitted to defer any payment, benefit or removal of restriction on the transfer of equity provided for in this Agreement, whether pursuant to Section 1(e), 1(f) or otherwise, until the tenth day after the later of its receipt of such release and the time at which the release has become valid, binding and irrevocable; provided that if the last day on which Teradyne would be permitted to commence payments, benefits, or removal of restrictions under this Agreement in accordance with this provision falls in the taxable year following the taxable year in which the date of the Termination Event occurs, then all benefits, payments, or removal of restrictions shall be made beginning in that taxable year. Employee shall sign such release within twenty-one (21) days of a Termination Event subsequent to a Change in Control. Teradyne agrees to provide Employee an estimate relating to payments to be made under this Agreement upon Employee’s written request.

(h) Certain Definitions. For purposes of this Agreement, the following terms shall have the following meanings:

“Cash Awards” shall mean any cash-based bonus, cash incentive or other cash awards provided by Teradyne to Employee pursuant to incentive plans that Teradyne maintains, including but not limited to its 2006 Equity and Cash Compensation Incentive Plan.

“Cause” shall mean conduct involving one or more of the following: (i) the substantial and continuing failure of Employee to render services to Teradyne in accordance with the terms or requirements of his or her employment; (ii) Employee’s disloyalty, gross negligence, willful misconduct, dishonesty, fraud or breach of fiduciary duty to Teradyne, each in connection with Employee’s employment by Teradyne; (iii) Employee’s deliberate disregard of the rules or policies of, or breach of an agreement with, Teradyne which results in direct or indirect material loss, damage or injury to Teradyne; (iv) the intentional unauthorized disclosure by Employee of any trade secret or confidential information of Teradyne; (v) the commission by Employee of an act which constitutes unfair competition with Teradyne; or (vi) the conviction of, or the entry of a plea of guilty or nolo contendere by the Employee, to any crime involving moral turpitude or any felony. In the event that the Company determines that Cause may exist pursuant to clauses (i), (iii) and (v) above, the Company shall give Employee written notice of the facts constituting such Cause and Employee shall have 30 days following receipt of such notice to remedy such Cause.

A “Change in Control” shall be deemed to have occurred upon the occurrence of any of the following events: (i) any consolidation, cash tender offer, reorganization, recapitalization, merger or plan of share exchange following which the capital stock of Teradyne outstanding immediately prior to such transaction constitutes less than a majority of the combined voting power of the then-outstanding securities of the combined corporation or person immediately after such transaction; (ii) any sale, lease, exchange or other transfer of all or substantially all of Teradyne’s assets; (iii) the adoption by the Board of Directors of Teradyne of any plan or proposal for the liquidation or dissolution of Teradyne; (iv) a change in the majority of the Board of Directors of Teradyne through one or more contested elections occurring within a three-year period; or (v) any person (as that term is used in Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act of 1934, as amended) becomes beneficial owner

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of 30% or more of the combined voting power of Teradyne’s outstanding voting securities, other than (A) as a result of a consolidation, reorganization, recapitalization, merger or plan of share exchange following which the capital stock of Teradyne outstanding immediately prior to such transaction constitutes at least a majority of the combined voting power of the then-outstanding securities of the combined corporation or person immediately after such transaction, (B) by any trustee or other fiduciary holding securities under an employee benefit plan of Teradyne, or (C) by a person temporarily acquiring beneficial ownership in its capacity as an underwriter (as defined pursuant to Section 2(a)(11) of the Securities Act of 1933, as amended) in connection with a public offering of Teradyne’s securities.

“Equity Awards” shall mean the equity ownership, participation or appreciation opportunities provided by Teradyne to Employee pursuant to incentive plans that Teradyne maintains, including but not limited to its 2006 Equity and Cash Compensation Incentive Plan, the Teradyne, Inc. 1991 Employee Stock Option Plan and the Teradyne, Inc. 1997 Employee Stock Option Plan, and any stock options, restricted stock units, restricted stock, stock appreciation rights, phantom stock and other stock-based awards granted thereunder.

“Good Reason” shall mean any one or more of the following: (i) any material reduction of Employee’s responsibilities (other than for Cause or as a result of death or disability) as they shall exist on the date of the consummation of the Change in Control; (ii) any material reduction in Employee’s Model Compensation as in effect on the date of the consummation of the Change in Control, or as the same may be increased from time to time, or any failure by Teradyne to pay to Employee any bonus accrued, but not yet paid, upon written notice by Employee to Teradyne, within 45 days; (iii) a material reduction in the value of Employee’s benefit package from the value of Employee’s benefit package on the date of the consummation of the Change in Control; or (iv) a requirement that Employee be based at an office that is greater than 50 miles from the location of Employee’s office immediately prior to the Change in Control except for required travel on Teradyne’s business to an extent substantially consistent with the business travel obligations which Employee undertook on behalf of Teradyne prior to the date of the consummation of the Change in Control. In the event of a Termination Event in contemplation of a Change of Control, the applicable baseline measurement date shall be six months prior to such Termination Event and not the date of the consummation of the Change in Control.

“Model Compensation” shall mean Employee’s annual “Model Compensation” as determined by Teradyne’s Compensation Committee or Board of Directors, which consists of (i) a fixed annual salary and (ii) a target annual variable amount.

“Performance Criteria” shall have the meaning ascribed to that term in the Teradyne, Inc. 2006 Equity and Cash Compensation Incentive Plan.

“Termination Event” shall mean (i) any termination of Employee by Teradyne without Cause or (ii) any voluntary termination by Employee for Good Reason; provided, that it shall not be a Termination Event merely because Employee ceases to be employed by Teradyne and becomes employed by a successor to Teradyne involved in the Change in Control that assumes or is otherwise bound by this Agreement as provided in Section 7(a). It is expressly

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understood that no Termination Event shall be deemed to have occurred merely because, upon the occurrence of a Change in Control, Employee ceases to be employed by Teradyne and does not become employed by a successor to Teradyne after the Change in Control if the successor makes an offer to employ Employee on terms and conditions which, if imposed by Teradyne, would not give Employee a basis on which to terminate employment for Good Reason.

(i) Termination in Contemplation of a Change in Control. For purposes of this Agreement, including without limitation, this Section 1, a Termination Event occurring “in contemplation of a Change in Control” means a Termination Event occurring within 3 months prior to an actual Change in Control at the request or direction of a person who enters or has entered into an agreement the consummation of which would cause a Change in Control or who conditions entry into such an agreement on the Employee’s termination whether or not such person actually enters into such an agreement. A termination by the Employee for Good Reason shall constitute a Termination Event in contemplation of a Change in Control if the actions constituting Good Reason were taken at the request or direction of a person who has entered into an agreement the consummation of which would cause a Change in Control.

2. Reduction of Payments

(a) Notwithstanding any other provision of this Agreement, in the event that the Company undergoes a Change in Ownership or Control (as defined below), the Company shall not be obligated to provide to the Executive a portion of any “Contingent Compensation Payments” (as defined below) that the Executive would otherwise be entitled to receive to the extent necessary to eliminate any “excess parachute payments” (as defined in Section 280G(b)(1) of the Internal Revenue Code of 1986, as amended (the “Code”)) for the Executive. For purposes of this Section 2, the Contingent Compensation Payments so eliminated shall be referred to as the “Eliminated Payments” and the aggregate amount (determined in accordance with Treasury Regulation Section 1.280G-1, Q/A-30 or any successor provision) of the Contingent Compensation Payments so eliminated shall be referred to as the “Eliminated Amount.”

(b) For purposes of this Section 2, the following terms shall have the following respective meanings:

(i) “Change in Ownership or Control” shall mean a change in the ownership or effective control of the Company or in the ownership of a substantial portion of the assets of the Company determined in accordance with Section 280G(b)(2) of the Code.

(ii) “Contingent Compensation Payment” shall mean any payment (or benefit) in the nature of compensation that is made or made available (under this Agreement or otherwise) to a “disqualified individual” (as defined in Section 280G(c) of the Code) and that is contingent (within the meaning of Section 280G(b)(2)(A)(i) of the Code) on a Change in Ownership or Control of the Company.

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(c) If and to the extent that any Contingent Compensation Payments are required to be treated as Eliminated Payments pursuant to this Section 2, then the Payments shall be reduced or eliminated, as determined by the Company, in the following order (i) any cash payments, (ii) any taxable benefits, (iii) any nontaxable benefits and (iv) any vesting of equity awards, in each case in reverse order beginning with the payments or benefits that are to be paid the farthest in time from the date that triggers the applicability of the excise tax, to the extent necessary to maximize the Eliminated Payments.

3. (a) Non-Competition and Non-Solicitation. From the Termination Event through the end of the Salary Continuation Period, Employee shall not directly or indirectly:

(i) Engage in any business or enterprise (whether as an owner, partner, officer, employee, director, investor, lender, consultant, independent contractor or otherwise, except as the holder of not more than 1% of the combined voting power of the outstanding stock of a publicly held company) that is competitive with Teradyne (including but not limited to, any business or enterprise that develops, designs, produces, markets, sells or renders any product or service competitive with any product or service developed, produced, marketed, sold or rendered by Teradyne while Employee was employed by Teradyne);

(ii) Either alone or in association with others, recruit, solicit, hire or engage as an independent contractor, any person who was employed by Teradyne at any time during the period of Employee’s employment with Teradyne, except for an individual whose employment with Teradyne has been terminated for a period of six months or longer; and

(iii) Either alone or in association with others, solicit, divert or take away, or attempt to divert or to take away, the business or patronage of any client or customer or entity that was a prospective client or customer of Teradyne during the Employee’s employment.

(b) If any restriction set forth in this Section 3 is found by any court of competent jurisdiction to be unenforceable because it extends for too long a period of time or over too great a range of activities or in too broad a geographic area, it shall be interpreted to extend only over the maximum period of time, range of activities or geographic area as to which it may be enforceable.

(c) Employee acknowledges that the restrictions contained in this Section 3 are necessary for the protection of the business and goodwill of Teradyne and are considered by Employee to be reasonable for such purpose. Employee agrees that any breach of this Section 3 will cause Teradyne irreparable harm and therefore, in the event of any such breach, in addition to such other remedies that may be available, Teradyne shall have the right to seek equitable and/or injunctive relief.

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(d) The geographic scope of this Section 3 shall extend to anywhere Teradyne or any of its subsidiaries is doing business, has done business or has plans to do business.

(e) Employee agrees that during the Salary Continuation Period, he/she will make reasonable good faith efforts to give verbal notice to Teradyne of each new business activity he/she plans to undertake, at least (5) business days prior to beginning any such activity.

(f) If Employee violates the provisions of this Section 3, Teradyne shall be entitled to suspend and recoup any salary continuation payment made per Section 1 (d) above and Employee shall continue to be bound by the restrictions set forth in this Section 3 for an additional period of time equal to the duration of the violation, such additional period not to exceed 24 months.

3A. No Obligation of Employment. Employee understands that the employment relationship between Employee and Teradyne will be “at will” and Employee understands that, prior to any Change in Control, Teradyne may terminate Employee with or without “Cause” at any time, including in contemplation of a Change in Control. Following any Change in Control, Teradyne may also terminate Employee with or without “Cause” at any time subject to Employee’s rights and Teradyne’s obligations specified in this Agreement.

4. Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the Commonwealth of Massachusetts and this Agreement shall be deemed to be performable in Massachusetts.

5. Severability. In case any one or more of the provisions contained in this Agreement for any reason shall be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision of this Agreement and this Agreement shall be construed to the maximum extent permitted by law.

6. Waivers and Modifications. This Agreement may be modified, and the rights, remedies and obligations contained in any provision hereof may be waived, only in accordance with this Section 6. No waiver by either party of any breach by the other or any provision hereof shall be deemed to be a waiver of any later or other breach thereof or as a waiver of any other provision of this Agreement. This Agreement may not be waived, changed, discharged or terminated orally or by any course of dealing between the parties, but only by an instrument in writing signed by the party against whom any waiver, change, discharge or termination is sought.

7. Assignment. (a) Teradyne shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of Teradyne expressly to assume and agree to perform under the terms of this Agreement in the same manner and to the same extent that Teradyne and its affiliates would be required to perform it if no such succession had taken place (provided that such a requirement to perform which arises by operation of law shall be deemed to satisfy the requirements for such an express assumption and agreement), and in such event Teradyne (as constituted prior to such

8

succession) shall have no further obligation under or with respect to this Agreement. Failure of Teradyne to obtain such assumption and agreement with respect to Employee prior to the effectiveness of any such succession shall be a breach of the terms of this Agreement with respect to Employee and shall entitle Employee to compensation from Teradyne (as constituted prior to such succession) in the same amount and on the same terms as Employee would be entitled to hereunder were Employee’s employment terminated for Good Reason following a Change in Control, except that for purposes of implementing the foregoing, the date on which any such succession becomes effective shall be deemed the date of the Termination Event. As used in this Agreement, “Teradyne” shall mean Teradyne as hereinbefore defined and any successor to its business or assets as aforesaid which assumes and agrees (or is otherwise required) to perform this Agreement. Nothing in this Section 7(a) shall be deemed to cause any event or condition which would otherwise constitute a Change in Control not to constitute a Change in Control.

(b) Notwithstanding Section 7(a), Teradyne shall remain liable to Employee upon a Termination Event after a Change in Control if Employee is not offered continuing employment by a successor to Teradyne or is offered continuing employment by a successor to Teradyne only on a basis which would constitute Good Reason for termination of employment hereunder.

(c) This Agreement, and Employee’s and Teradyne’s rights and obligations hereunder, may not be assigned by Employee or, except as provided in Section 7(a), Teradyne, respectively; any purported assignment by Employee or Teradyne in violation hereof shall be null and void.

(d) The terms of this Agreement shall inure to the benefit of and be enforceable by the personal or legal representatives, executors, administrators, permitted successors, heirs, distributees, devisees and legatees of Employee. If Employee shall die while an amount would still be payable to Employee hereunder if they had continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to Employee’s devisee, legatee or other designee or, if there is no such designee, Employee’s estate.

8. Entire Agreement. This Agreement constitutes the entire understanding of the parties relating to the subject matter hereof and supersedes and cancels all agreements, written or oral, made prior to the date hereof between Employee and Teradyne relating to the subject matter hereof; provided, however, that Employee’s existing Cash Award and Equity Award agreements, as modified hereby, shall remain in effect. This Agreement shall not limit any right of Employee to receive any payments or benefits under an employee benefit or Employee compensation plan of Teradyne, initially adopted as of or after the date hereof, which are expressly contingent thereunder upon the occurrence of a Change in Control (including, but not limited to, the acceleration of any rights or benefits thereunder); provided that in no event shall Employee be entitled to any payment or benefit under this Agreement which duplicates a payment or benefit received or receivable by Employee under any severance or similar plan or policy of Teradyne, and in any such case Employee shall only be entitled to receive the greater of the two payments.

9

9. Notices. All notices hereunder shall be in writing and shall be delivered in person or mailed by certified or registered mail, return receipt requested, addressed as follows:

If to Teradyne, to:	Teradyne, Inc.
	600 Riverpark Drive
	MS NR600-2-2 (Legal Department)
	North Reading, MA 01864
	Attention: General Counsel

If to Employee, at Employee’s address in his employment file on record with the Human Resources Department.

10. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

11. Section Headings. The descriptive section headings herein have been inserted for convenience only and shall not be deemed to define, limit, or otherwise affect the construction of any provision hereof.

12. Term. The term of this Agreement (the “Term”) shall commence upon the date hereof and terminate upon the earlier of (i) twenty-four (24) months following any Change in Control of Teradyne, (ii) the date prior to any Change in Control of Teradyne that Employee for any reason ceases to be an employee of Teradyne (other than a Termination Event in contemplation of a Change in Control) and (iii) the date following any Change in Control of Teradyne that Employee is terminated for Cause or voluntary terminates his employment (other than for Good Reason).

13. Expenses. All reasonable legal fees and expenses incurred in a legal proceeding by Employee in seeking to obtain or enforce any right or benefit provided by this Agreement against a successor to Teradyne shall be the responsibility of and paid for by the successor to Teradyne (but not Teradyne as constituted prior to such succession). Such payments are to be made within twenty (20) days after Employee’s request for payment accompanied with such evidence of fees and expenses incurred as Teradyne’s successor reasonably may require; provided that if Employee institutes a proceeding and the judge or other decision-maker presiding over the proceeding affirmatively finds that Employee has failed to prevail substantially, Employee shall pay Employee’s own costs and expenses (and, if applicable, return any amounts theretofore paid on Employee’s behalf under this Section 13).

14. Payments. Any payments hereunder shall be made out of the general assets of Teradyne. The Employee shall have the status of general unsecured creditor of Teradyne, and this Agreement constitutes a mere promise by Teradyne to make payments under this Agreement in the future as and to the extent provided herein. Unless otherwise determined by Teradyne in an applicable plan or arrangement, no amounts payable hereunder upon a Termination Event shall be deemed salary or compensation for the purpose of computing benefits under any employee benefit plan or other arrangement of Teradyne for the benefit of its employees. Teradyne shall be entitled to withhold from any payments or deemed payments any amount of tax withholding required by law.

10

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.

TERADYNE, INC.
By:	/s/ Michael A. Bradley
Name:	Michael A. Bradley
Title:	CEO & President
EMPLOYEE
/s/ Walter G. Vahey
Name:	Walter G. Vahey

11

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Michael A. Bradley, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Teradyne, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 10, 2012

By:	/s/    MICHAEL A. BRADLEY
	Michael A. Bradley Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Gregory R. Beecher, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Teradyne, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 10, 2012

By:	/s/    GREGORY R. BEECHER
	Gregory R. Beecher Chief Financial Officer and Treasurer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Teradyne, Inc. (the “Company”) on Form 10-Q for the period ending July 1, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Michael A. Bradley, Chief Executive Officer of the Company, certify pursuant to 18 U.S.C (S) 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.

/s/    MICHAEL A. BRADLEY

Michael A. Bradley

Chief Executive Officer

August 10, 2012

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Teradyne, Inc. (the “Company”) on Form 10-Q for the period ending July 1, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Gregory R. Beecher, Chief Financial Officer of the Company, certify pursuant to 18 U.S.C (S) 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.

/S/    GREGORY R. BEECHER

Gregory R. Beecher

Chief Financial Officer and Treasurer

August 10, 2012

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Schedule of Condensed Consolidated Balance Sheets (Detail) (USD $) In Thousands, unless otherwise specified	Jul. 01, 2012	Dec. 31, 2011
Change In Accounting Principle
Total assets	$ 2,434,670	$ 2,188,639
Total liabilities	749,240	683,579
Common stock	23,402	22,948
Additional paid-in capital	1,327,574	1,293,130
Accumulated other comprehensive (loss) income	5,267	4,746
Retained earnings	329,187	184,236
Total shareholders' equity	1,685,430	1,505,060
Total liabilities and shareholders' equity	2,434,670	2,188,639
Originally Reported
Change In Accounting Principle
Total assets		2,188,639
Total liabilities		683,579
Common stock		22,948
Additional paid-in capital		1,293,130
Accumulated other comprehensive (loss) income		(129,875)
Retained earnings		318,857
Total shareholders' equity		1,505,060
Total liabilities and shareholders' equity		2,188,639
Effect Of Accounting Change
Change In Accounting Principle
Accumulated other comprehensive (loss) income		134,621
Retained earnings		$ (134,621)

XML

Schedule of Reported Available for Sale Marketable Securities (Detail) (USD $)	Jul. 01, 2012	Dec. 31, 2011
Schedule of Available-for-sale Securities
Available-for-sale marketable securities, Cost	$ 236,726,000	$ 178,625,000
Available-for-sale marketable securities, Unrealized Gain	3,079,000	2,581,000
Available-for-sale marketable securities, Unrealized (Loss)	(108,000)	(297,000)
Available-for-sale marketable securities, Fair Market Value	239,697,000	180,909,000
Available-for-sale marketable securities, Fair Market Value of Investments with Unrealized Losses	87,491,000	64,571,000
Marketable securities
Schedule of Available-for-sale Securities
Available-for-sale marketable securities, Cost	105,954,000	96,518,000
Available-for-sale marketable securities, Unrealized Gain	12,000	24,000
Available-for-sale marketable securities, Unrealized (Loss)	(19,000)	(40,000)
Available-for-sale marketable securities, Fair Market Value	105,947,000	96,502,000
Available-for-sale marketable securities, Fair Market Value of Investments with Unrealized Losses	47,572,000	35,595,000
Long-term marketable securities
Schedule of Available-for-sale Securities
Available-for-sale marketable securities, Cost	130,772,000	82,107,000
Available-for-sale marketable securities, Unrealized Gain	3,067,000	2,557,000
Available-for-sale marketable securities, Unrealized (Loss)	(89,000)	(257,000)
Available-for-sale marketable securities, Fair Market Value	133,750,000	84,407,000
Available-for-sale marketable securities, Fair Market Value of Investments with Unrealized Losses	$ 39,919,000	$ 28,976,000

XML

Schedule of Reported Financial Assets and Liabilities (Detail) (USD $) In Thousands, unless otherwise specified	Jul. 01, 2012	Dec. 31, 2011
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	$ 828,753	$ 754,645
Contingent consideration	54,662	68,892
Liabilities	54,743	69,206
Cash and Cash Equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	589,056	573,736
Marketable securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	105,947	96,502
Long-term marketable securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	133,750	84,407
Other Accrued Liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Liabilities	81	314
Quoted Prices in Active Markets for Identical Instruments (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	616,826	580,263
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Cash and Cash Equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	578,825	557,572
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Marketable securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	5,431	9,044
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Long-term marketable securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	32,570	13,647
Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	211,927	174,382
Liabilities	81	314
Significant Other Observable Inputs (Level 2) | Cash and Cash Equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	10,231	16,164
Significant Other Observable Inputs (Level 2) | Marketable securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	100,516	87,458
Significant Other Observable Inputs (Level 2) | Long-term marketable securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Assets	101,180	70,760
Significant Other Observable Inputs (Level 2) | Other Accrued Liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Liabilities	81	314
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Contingent consideration	54,662	68,892
Liabilities	$ 54,662	$ 68,892

XML

Net Income Per Common Share - Additional Information (Detail) In Millions, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
Stock Options
Net Income Loss Per Common Share
Computation of diluted net income per common excluding the effect of the potential exercise of stock options and restricted stock units	0.3	0.5	0.3	1.0
Restricted Stock Units
Net Income Loss Per Common Share
Computation of diluted net income per common excluding the effect of the potential exercise of stock options and restricted stock units	0.1		0.1

XML

Contractual Maturities of Available-For-Sale Marketable Securities (Detail) (USD $)	Jul. 01, 2012	Dec. 31, 2011
Schedule of Available-for-sale Securities
Available for sale securities, Cost	$ 236,726,000	$ 178,625,000
Due In One Year Or Less
Schedule of Available-for-sale Securities
Available for sale securities, Cost	107,961
Available for sale securities, Fair Market Value	$ 107,954
Due After One Year Through Five Years
Schedule of Available-for-sale Securities
Available for sale securities, Cost	110,388
Available for sale securities, Fair Market Value	$ 111,299
Due After Five Years Through Ten Years
Schedule of Available-for-sale Securities
Available for sale securities, Cost	2,662
Available for sale securities, Fair Market Value	$ 2,836
Due After Ten Years
Schedule of Available-for-sale Securities
Available for sale securities, Cost	15,715
Available for sale securities, Fair Market Value	$ 17,608
Available-for-sale Securities
Schedule of Available-for-sale Securities
Available for sale securities, Cost	$ 236,726
Available for sale securities, Fair Market Value	$ 239,697

XML

Schedule of Segment Reporting Information by Segment Charges (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
Segment Reporting Information
Restructuring and other, net	$ 6,262	$ (1,279)	$ 8,087	$ (1,692)
Semiconductor Test
Segment Reporting Information
Cost of revenues-provision for excess and obsolete inventory	5,957	1,500	6,169	5,942
Restructuring and other, net	286	1,279	286	2,170
Total	6,243	2,779	6,455	8,112
Systems Test Group
Segment Reporting Information
Cost of revenues-provision for excess and obsolete inventory	1,753	216	2,642	401
Restructuring and other, net				(246)
Total	1,753	216	2,642	155
Wireless Test
Segment Reporting Information
Cost of revenues-inventory step-up	1,218		6,089
Cost of revenues-provision for excess and obsolete inventory	1,643		2,116
Total	2,861		8,205
Corporate And Eliminations
Segment Reporting Information
Restructuring and other, net	(6,548)		(8,406)	(232)
Total	$ (6,548)		$ (8,406)	$ (232)

XML

Discontinued Operations (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended	6 Months Ended
	Jul. 03, 2011	Jul. 03, 2011
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations
Net revenues		$ 9,086
Income from discontinued operations before income taxes		1,436
Gain from disposal of discontinued operations before income taxes	(832)	28,949
Income tax provision		4,311
Income from discontinued operations	$ (832)	$ 26,074

XML

Intangible Assets (Tables)

6 Months Ended

Jul. 01, 2012

Schedule Of Amortizable Intangible Assets

Amortizable intangible assets consist of the following and are included in intangible assets on the balance sheet:

	July 1, 2012
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Useful Life
	(in thousands)
Developed technology	$	358,155	$	117,363	$	240,792		6.3 years
Customer relationships and service and software maintenance contracts		144,971		54,347		90,624		8.0 years
Trade names and trademarks		33,840		9,139		24,701		9.0 years
Customer backlog		1,000		1,000		—		0.4 years
Total intangible assets	$	537,966	$	181,849	$	356,117		7.0 years

	December 31, 2011
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Useful Life
	(in thousands)
Developed technology	$	358,155	$	91,391	$	266,764		6.3 years
Customer relationships and service and software maintenance contracts		144,971		45,230		99,741		8.0 years
Trade names and trademarks		33,840		7,370		26,470		9.0 years
Customer backlog		1,000		1,000		—		0.4 years
Total intangible assets	$	537,966	$	144,991	$	392,975		7.0 years

Schedule Of Estimated Intangible Asset Amortization Expense

Estimated intangible asset amortization expense for each of the five succeeding fiscal years is as follows:

Year	Amortization Expense
	(in thousands)
2012 (remainder)	$	36,650
2013		72,459
2014		69,374
2015		52,351
2016		52,351

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Stock Repurchase Program - Additional Information (Detail) (USD $) In Millions, except Per Share data, unless otherwise specified	1 Months Ended	6 Months Ended
	Nov. 30, 2010	Jul. 01, 2012
Stock Repurchase Program
Stock repurchase program, authorized amount	$ 200
Repurchase of stock, shares		2.6
Repurchase of stock, value		$ 31.2
Common stock average price		$ 11.84

XML

Retirement Plans (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
Defined Benefit Pension Plans
Defined Benefit Plan Disclosure
Service cost	$ 643	$ 668	$ 1,357	$ 1,436
Interest cost	4,125	4,457	8,185	8,784
Expected return on plan assets	(4,082)	(3,906)	(8,164)	(7,818)
service benefit	58	155	116	310
Settlement		680		680
Actuarial gain	3,146	4,279	3,146	4,279
Total net periodic pension cost	3,890	6,333	4,640	7,671
Post-Retirement Benefit Plans
Defined Benefit Plan Disclosure
Service cost	15	14	34	30
Interest cost	108	134	219	270
service benefit	(150)	(150)	(299)	(299)
Actuarial gain	(92)	(76)	(92)	(76)
Total net periodic pension cost	$ (119)	$ (78)	$ (138)	$ (75)

XML

Schedule of Effect of Derivative Instruments in Statement of Operations Recognized (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
Fair Value, Option, Quantitative Disclosures
Foreign exchange contracts derivatives not designated as hedging instruments, (Gains) Losses Recognized in Statement of Operations	$ (2,360)	$ (166)	$ 520	$ 661
Interest Expense And Other
Fair Value, Option, Quantitative Disclosures
Foreign exchange contracts derivatives not designated as hedging instruments, (Gains) Losses Recognized in Statement of Operations	$ (2,360)	$ (166)	$ 520	$ 661

XML

Segment Information - Additional Information (Detail)	6 Months Ended
	Jul. 01, 2012 Segment
Segment Reporting Information
Number of operating segments	3

XML

Schedule of Segment Information (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended				6 Months Ended
	Jul. 01, 2012		Jul. 03, 2011		Jul. 01, 2012		Jul. 03, 2011
Segment Reporting Information
Net revenues	$ 548,284		$ 410,519		$ 944,952		$ 787,680
Income (loss) from continuing operations before income taxes	151,992	[1],[2]	95,923	[1],[2]	193,236	[1],[2]	171,347	[1],[2]
Semiconductor Test
Segment Reporting Information
Net revenues	365,058		343,096		632,646		662,346
Income (loss) from continuing operations before income taxes	91,249	[1],[2]	90,973	[1],[2]	126,247	[1],[2]	167,900	[1],[2]
Systems Test Group
Segment Reporting Information
Net revenues	71,298		67,423		169,050		125,334
Income (loss) from continuing operations before income taxes	11,628	[1],[2]	8,823	[1],[2]	33,606	[1],[2]	14,314	[1],[2]
Wireless Test
Segment Reporting Information
Net revenues	111,928				143,256
Income (loss) from continuing operations before income taxes	51,139	[1],[2]			38,827	[1],[2]
Corporate And Eliminations
Segment Reporting Information
Income (loss) from continuing operations before income taxes	$ (2,024)	[1],[2]	$ (3,873)	[1],[2]	$ (5,444)	[1],[2]	$ (10,867)	[1],[2]

[1] Pension and post retirement actuarial gains and losses, interest income, and interest expense and other are included in Corporate and Eliminations.

[2] Included in the income (loss) from continuing operations before income taxes for each of the segments are charges and credits for the three and six months ended July 1, 2012 and July 3, 2011 that include restructuring and other, net, and provision for excess and obsolete inventory, as follows:

XML

Restructuring and Other Net - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	6 Months Ended				3 Months Ended	6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012 Minimum	Jul. 01, 2012 Maximum	Jul. 01, 2012 Other	Jul. 01, 2012 Other	Jul. 01, 2012 Q2 2012 Activity Semiconductor Test Employee	Jul. 03, 2011 Q2 2011 Activity Semiconductor Test Employee	Jul. 03, 2011 Q1 2011 Activity Semiconductor Test Employee	Jul. 03, 2011 Q1 2011 Actions Semiconductor Test	Jul. 01, 2012 Pre-2011 Actions Systems Test Group
Restructuring Cost and Reserve
Fair value adjustment to decrease acquisition contingent consideration					$ 6.5	$ 8.4
Estimated undiscounted range of outcomes for contingent consideration			56.0	58.0
Contingent consideration payment	5.8
Pension settlement charge related to non-U.S.		0.7
Remaining accrual for lease payments	1.5
Expected lease accruals payment	0.9
Lease expiration date	Dec. 31, 2013
Future lease commitments net of expected sublease income	0.3
Severance benefit and charges							0.3	0.3		0.6
Reduction in employees headcount							10	2	5
Changes in estimated exit costs											$ (0.5)

XML

Accounting Policies (Policies)

6 Months Ended

Jul. 01, 2012

Basis of Presentation

Basis of Presentation

The condensed consolidated interim financial statements include the accounts of Teradyne and its subsidiaries. All significant intercompany balances and transactions have been eliminated. These interim financial statements are unaudited and reflect all normal recurring adjustments that are, in the opinion of management, necessary for the fair presentation of such interim financial statements. Certain prior year’s amounts were reclassified to conform to the current year presentation. The December 31, 2011 condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America.

The accompanying financial information should be read in conjunction with the consolidated financial statements and notes thereto contained in Teradyne’s Annual Report on Form 10-K, filed with the U.S. Security and Exchange Commission (“SEC”) on February 29, 2012, for the year ended December 31, 2011.

Preparation of Financial Statements and Use of Estimates

Preparation of Financial Statements and Use of Estimates

The preparation of consolidated financial statements requires management to make estimates and judgments that affect the amounts reported in the financial statements. Actual results may differ significantly from these estimates.

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Schedule of Changes in Fair Value of Level 3 Contingent Consideration (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Apr. 01, 2012	Jul. 01, 2012
Fair Value Measurements
Beginning Balance	$ 61,210	$ 68,892	$ 68,892
Fair value adjustment	(6,548)	(1,858)	(8,406)
Payment		(5,824)
Ending Balance	$ 54,662	$ 61,210	$ 54,662

XML

Schedule of Condensed Consolidated Statements of Comprehensive Income (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
Change In Accounting Principle
Net income	$ 111,387	$ 87,252	$ 144,951	$ 184,096
Foreign currency translation reclassification adjustment included in net income				2,266
Unrealized gains on marketable securities	428	1,295	706	1,310
Prior service costs, net of tax of $0	(92)	5	(183)	11
Other comprehensive income	336	1,300	523	3,587
Comprehensive income	111,723	88,552	145,474	187,683
Originally Reported
Change In Accounting Principle
Net income		89,058		183,930
Foreign currency translation reclassification adjustment included in net income				2,266
Unrealized gains on marketable securities		1,295		1,310
Actuarial losses arising during period, net of tax of ($5), $5		(4,150)		(4,201)
Settlement gain, net of tax of $38, ($38)		217		277
Actuarial losses, net of tax of $20, ($20)		2,377		4,455
Prior service costs, net of tax of $0		5		11
Defined benefit pension and post-retirement plans, total		2,382		4,466
Other comprehensive income		(256)		4,118
Comprehensive income		88,802		188,048
Effect Of Accounting Change
Change In Accounting Principle
Net income		(1,806)		166
Actuarial losses arising during period, net of tax of ($5), $5		4,150		4,201
Settlement gain, net of tax of $38, ($38)		(217)		(277)
Actuarial losses, net of tax of $20, ($20)		(2,377)		(4,455)
Defined benefit pension and post-retirement plans, total		(2,377)		(4,455)
Other comprehensive income		1,556		(531)
Comprehensive income		(250)		(365)
As Adjusted
Change In Accounting Principle
Net income		87,252		184,096
Foreign currency translation reclassification adjustment included in net income				2,266
Unrealized gains on marketable securities		1,295		1,310
Prior service costs, net of tax of $0		5		11
Defined benefit pension and post-retirement plans, total		5		11
Other comprehensive income		1,300		3,587
Comprehensive income		$ 88,552		$ 187,683

XML

Commitments and Contingencies - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jul. 01, 2012
Purchase Commitment, Excluding Long-term Commitment
Aggregate purchase commitments	$ 281.4
Purchase commitments less than one year	$ 280.0
Purchase commitments period	Less than one year

XML

Segment Information (Tables)

6 Months Ended

Jul. 01, 2012

Schedule Of Segment Information

Segment information is as follows:

	Semiconductor Test		Systems Test Group		Wireless Test		Corporate and Eliminations			Consolidated
	(in thousands)
Three months ended July 1, 2012:
Net revenues	$	365,058	$	71,298	$	111,928	$	—		$	548,284
Income (loss) from continuing operations before income taxes(1)(2)		91,249		11,628		51,139		(2,024	)		151,992
Three months ended July 3, 2011:
Net revenues	$	343,096	$	67,423	$	—	$	—		$	410,519
Income (loss) from continuing operations before income taxes(1)(2)		90,973		8,823		—		(3,873	)		95,923
Six months ended July 1, 2012:
Net revenues	$	632,646	$	169,050	$	143,256	$	—		$	944,952
Income (loss) from continuing operations before income taxes(1)(2)		126,247		33,606		38,827		(5,444	)		193,236
Six months ended July 3, 2011:
Net revenues	$	662,346	$	125,334	$	—	$	—		$	787,680
Income (loss) from continuing operations before income taxes(1)(2)		167,900		14,314		—		(10,867	)		171,347

(1) Pension and post retirement actuarial gains and losses, interest income, and interest expense and other are included in Corporate and Eliminations.

(2) Included in the income (loss) from continuing operations before income taxes for each of the segments are charges and credits for the three and six months ended July 1, 2012 and July 3, 2011 that include restructuring and other, net, and provision for excess and obsolete inventory, as follows:

Semiconductor Test

Schedule Of Segment Reporting Information By Segment Charges

Included in the Semiconductor Test segment are charges for the following:

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Cost of revenues—provision for excess and obsolete inventory	$	5,957	$	1,500	$	6,169	$	5,942
Restructuring and other, net		286		1,279		286		2,170
Total	$	6,243	$	2,779	$	6,455	$	8,112

Systems Test Group

Schedule Of Segment Reporting Information By Segment Charges

Included in the Systems Test Group segment are charges and credits for the following:

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Cost of revenues—provision for excess and obsolete inventory	$	1,753	$	216	$	2,642	$	401
Restructuring and other, net		—		—		—		(246	)
Total	$	1,753	$	216	$	2,642	$	155

Wireless Test

Schedule Of Segment Reporting Information By Segment Charges

Included in the Wireless Test segment are charges for the following:

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Cost of revenues—inventory step-up	$	1,218	$	—	$	6,089	$	—
Cost of revenues—provision for excess and obsolete inventory		1,643		—		2,116		—
Total	$	2,861	$	—	$	8,205	$	—

Corporate And Eliminations

Schedule Of Segment Reporting Information By Segment Charges

Included in Corporate and Eliminations are credits for the following:

	For the Three Months Ended					For the Six Months Ended
	July 1,  2012			July 3,  2011		July 1,  2012			July 3,  2011
	(in thousands)
Restructuring and other, net	$	(6,548	)	$	—	$	(8,406	)	$	(232	)
Total	$	(6,548	)	$	—	$	(8,406	)	$	(232	)

XML

Schedule of Carrying Amounts and Fair Values of Financial Instrument (Detail) (USD $) In Thousands, unless otherwise specified	Jul. 01, 2012		Dec. 31, 2011		Jul. 03, 2011	Jan. 03, 2011	Mar. 31, 2009
Fair Value, Balance Sheet Grouping, Financial Statement Captions
Cash and cash equivalents, Carrying Value	$ 589,056		$ 573,736		$ 455,398	$ 397,737
Convertible debt, Carrying Value	162,762		156,098
Japan loan, Carrying Value							10,000
Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions
Cash and cash equivalents, Carrying Value	589,056		573,736
Marketable securities, Carrying Value	239,697		180,909
Convertible debt, Carrying Value	162,762	[1]	156,098	[1]
Japan loan, Carrying Value	5,043		6,431
Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions
Cash and cash equivalents, Fair Value	589,056		573,736
Marketable securities, Fair Value	239,697		180,909
Convertible debt, Fair Value	496,138	[1]	485,925	[1]
Japan loan, Fair Value	$ 5,043		$ 6,431

[1] The carrying value represents the bifurcated debt component only, while the fair value is based on quoted market prices for the convertible note which includes the equity conversion feature.

XML

Schedule of Estimated Intangible Asset Amortization Expense (Detail) (USD $) In Thousands, unless otherwise specified	Jul. 01, 2012
Finite-Lived Intangible Assets
2012 (remainder)	$ 36,650
2013	72,459
2014	69,374
2015	52,351
2016	$ 52,351

XML

Schedule of Product Warranty (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
Product Warranty [Line Items]
Balance at beginning of period	$ 8,722	$ 9,502	$ 8,154	$ 9,886
Accruals for warranties issued during the period	5,649	3,976	9,425	7,553
Adjustments related to pre-existing warranties	403	(1,116)	143	(2,072)
Settlements made during the period	(3,727)	(3,100)	(6,675)	(6,105)
Balance at end of period	$ 11,047	$ 9,262	$ 11,047	$ 9,262

XML

Schedule of Fair Value of Financial Assets and Liabilities Measured on Recurring Basis (Detail) (USD $) In Thousands, unless otherwise specified	Jul. 01, 2012	Dec. 31, 2011
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	$ 239,697	$ 180,909
Total	828,753	754,645
Contingent consideration	54,662	68,892
Derivatives, Liabilities	81	314
Liabilities	54,743	69,206
Cash
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Cash	214,948	161,243
Cash Equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Cash equivalents	374,108	412,493
U.S. Government Agency Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	112,315	83,197
Corporate Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	48,891	44,829
Commercial Paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	30,990	22,075
U.S. Treasury Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	28,673	14,180
Certificates Of Deposit And Time Deposits
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	9,500	8,117
Equity And Debt Mutual Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	9,058	8,237
Non-U.S. Government Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	270	274
Quoted Prices in Active Markets for Identical Instruments (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Total	616,826	580,263
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Cash
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Cash	214,948	161,243
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Cash Equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Cash equivalents	363,877	396,329
Quoted Prices in Active Markets for Identical Instruments (Level 1) | U.S. Treasury Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	28,673	14,180
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Equity And Debt Mutual Funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	9,058	8,237
Quoted Prices in Active Markets for Identical Instruments (Level 1) | Non-U.S. Government Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	270	274
Significant Other Observable Inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Total	211,927	174,382
Derivatives, Liabilities	81	314
Liabilities	81	314
Significant Other Observable Inputs (Level 2) | Cash Equivalents
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Cash equivalents	10,231	16,164
Significant Other Observable Inputs (Level 2) | U.S. Government Agency Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	112,315	83,197
Significant Other Observable Inputs (Level 2) | Corporate Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	48,891	44,829
Significant Other Observable Inputs (Level 2) | Commercial Paper
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	30,990	22,075
Significant Other Observable Inputs (Level 2) | Certificates Of Deposit And Time Deposits
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Available for sale securities	9,500	8,117
Significant Unobservable Inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis
Contingent consideration	54,662	68,892
Liabilities	$ 54,662	$ 68,892

XML

Accounting Policies

6 Months Ended

Jul. 01, 2012

Accounting Policies

B. Accounting Policies

Basis of Presentation

The condensed consolidated interim financial statements include the accounts of Teradyne and its subsidiaries. All significant intercompany balances and transactions have been eliminated. These interim financial statements are unaudited and reflect all normal recurring adjustments that are, in the opinion of management, necessary for the fair presentation of such interim financial statements. Certain prior year’s amounts were reclassified to conform to the current year presentation. The December 31, 2011 condensed consolidated balance sheet data was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America.

The accompanying financial information should be read in conjunction with the consolidated financial statements and notes thereto contained in Teradyne’s Annual Report on Form 10-K, filed with the U.S. Security and Exchange Commission (“SEC”) on February 29, 2012, for the year ended December 31, 2011.

Preparation of Financial Statements and Use of Estimates

The preparation of consolidated financial statements requires management to make estimates and judgments that affect the amounts reported in the financial statements. Actual results may differ significantly from these estimates.

XML

Schedule of Extended Product Warranty (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
Product Warranty [Line Items]
Balance at beginning of period	$ 12,927	$ 9,870	$ 12,742	$ 8,972
Deferral of new extended warranty revenue	9,935	1,861	12,282	3,798
Recognition of extended warranty deferred revenue	(2,108)	(1,423)	(4,270)	(2,462)
Balance at end of period	$ 20,754	$ 10,308	$ 20,754	$ 10,308

XML

Schedule of Condensed Consolidated Statements of Comprehensive Income (Parenthetical) (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended	6 Months Ended
	Jul. 03, 2011	Jul. 03, 2011
Originally Reported
Change In Accounting Principle
Defined benefit pension and post-retirement plans: Actuarial losses, tax portion	$ (10)	$ (5)
Defined benefit pension and post-retirement plans: Settlement gain, tax portion	38	73
Pension and post-retirement costs: Actuarial losses, tax portion	8	20
Pension and post-retirement costs: Prior service costs, tax portion	0	0
Effect Of Accounting Change
Change In Accounting Principle
Defined benefit pension and post-retirement plans: Actuarial losses, tax portion	10	5
Defined benefit pension and post-retirement plans: Settlement gain, tax portion	(38)	(73)
Pension and post-retirement costs: Actuarial losses, tax portion	(8)	(20)
As Adjusted
Change In Accounting Principle
Pension and post-retirement costs: Prior service costs, tax portion	$ 0	$ 0

XML

Debt (Tables)

6 Months Ended

Jul. 01, 2012

Components Of Convertible Senior Notes

The tables below represent the components of Teradyne’s convertible senior notes:

	July 1, 2012		December 31, 2011
	(in thousands)
Debt principal	$	190,000	$	190,000
Unamortized debt discount		27,238		33,902
Net carrying amount of the convertible debt	$	162,762	$	156,098

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Contractual interest expense	$	2,138	$	2,138	$	4,299	$	4,347
Amortization of the discount component and debt issue fees		3,592		3,160		7,071		6,221
Total interest expense on the convertible debt	$	5,730	$	5,298	$	11,370	$	10,568

XML

Financial Instruments and Derivatives (Tables)

6 Months Ended

Jul. 01, 2012

Schedule Of Fair Value Of Financial Assets And Liabilities Measured On Recurring Basis

The following table sets forth by fair value hierarchy Teradyne’s financial assets and liabilities that were measured at fair value on a recurring basis as of July 1, 2012 and December 31, 2011.

	July 1, 2012
	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in thousands)
Assets
Cash	$	214,948	$	—	$	—	$	214,948
Cash equivalents		363,877		10,231		—		374,108
Available for sale securities:
U.S. government agency securities		—		112,315		—		112,315
Corporate debt securities		—		48,891		—		48,891
Commercial paper		—		30,990		—		30,990
U.S. Treasury securities		28,673		—		—		28,673
Certificates of deposit and time deposits		—		9,500		—		9,500
Equity and debt mutual funds		9,058		—		—		9,058
Non-U.S. government securities		270		—		—		270
Total	$	616,826	$	211,927	$	—	$	828,753
Liabilities
Contingent consideration	$	—	$	—	$	54,662	$	54,662
Derivatives		—		81		—		81
Total	$	—	$	81	$	54,662	$	54,743

	December 31, 2011
	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in thousands)
Assets
Cash	$	161,243	$	—	$	—	$	161,243
Cash equivalents		396,329		16,164		—		412,493
Available for sale securities:
U.S. government agency securities		—		83,197		—		83,197
Corporate debt securities		—		44,829		—		44,829
Commercial paper		—		22,075		—		22,075
U.S. Treasury securities		14,180		—		—		14,180
Equity and debt mutual funds		8,237		—		—		8,237
Certificates of deposit and time deposits		—		8,117		—		8,117
Non-U.S. government securities		274		—		—		274
Total	$	580,263	$	174,382	$	—	$	754,645
Liabilities
Contingent consideration	$	—	$	—	$	68,892	$	68,892
Derivatives		—		314		—		314
Total	$	—	$	314	$	68,892	$	69,206

Schedule Of Reported Financial Assets And Liabilities

Reported as follows:

	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets
Cash and cash equivalents	$	578,825	$	10,231	$	—	$	589,056
Marketable securities		5,431		100,516		—		105,947
Long-term marketable securities		32,570		101,180		—		133,750
	$	616,826	$	211,927	$	—	$	828,753
Liabilities
Contingent consideration	$	—	$	—	$	54,662	$	54,662
Other accrued liabilities		—		81		—		81
	$	—	$	81	$	54,662	$	54,743

 Reported as follows:

	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets
Cash and cash equivalents	$	557,572	$	16,164	$	—	$	573,736
Marketable securities		9,044		87,458		—		96,502
Long-term marketable securities		13,647		70,760		—		84,407
	$	580,263	$	174,382	$	—	$	754,645
Liabilities
Contingent consideration	$	—	$	—	$	68,892	$	68,892
Other accrued liabilities		—		314		—		314
	$	—	$	314	$	68,892	$	69,206

Schedule Of Quantitative Information Associated With Fair Value Measurement Of Level 3

The following table provides quantitative information associated with the fair value measurement of Teradyne’s Level 3 financial instrument:

	July 1, 2012			Weighted Average
Liability	Fair Value	Valuation Technique	Unobservable Inputs
	(in thousands)
Contingent consideration	$54,662	Income approach— discounted cash flow	Revenue earn-out—probability of low case (scenario) for calendar year 2012 revenue.		70	%
			Revenue earn-out—probability of high case (scenario) for calendar year 2012 revenue.		30	%
			Discount rate for revenue earn-out		3.5	%
			Discount rate for new product earn-out		3.5	%

Schedule Of Changes In Fair Value Of Level 3 Contingent Consideration

The following table represents changes in the fair value of Level 3 contingent consideration:

	Contingent consideration
	(in thousands)
Balance at December 31, 2011	$	68,892
Fair value adjustment		(1,858	)
Payment		(5,824	)
Balance at April 1, 2012		61,210
Fair value adjustment		(6,548	)
Balance at July 1, 2012	$	54,662

Schedule Of Carrying Amounts And Fair Values Of Financial Instruments

The carrying amounts and fair values of financial instruments at July 1, 2012 and December 31, 2011 were as follows:

	July 1, 2012				December 31, 2011
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(in thousands)
Cash and cash equivalents	$	589,056	$	589,056	$	573,736	$	573,736
Marketable securities		239,697		239,697		180,909		180,909
Convertible debt(1)		162,762		496,138		156,098		485,925
Japan loan		5,043		5,043		6,431		6,431

(1) The carrying value represents the bifurcated debt component only, while the fair value is based on quoted market prices for the convertible note which includes the equity conversion feature.

Schedule Of Available-For-Sale Marketable Securities

At July 1, 2012 and December 31, 2011, available-for-sale marketable securities were reported as follows:

	July 1, 2012
	Available-for-Sale									Fair Market Value of Investments with  Unrealized Losses
	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value
	(in thousands)
U.S. government agency securities	$	112,162	$	168	$	(15	)	$	112,315	$	49,867
Corporate debt securities		46,890		2,071		(70	)		48,891		18,236
Commercial paper		30,994		5		(9	)		30,990		13,234
U.S. Treasury securities		28,564		109		—			28,673		—
Certificates of deposit and time deposits		9,501		—		(1	)		9,500		5,822
Equity and debt mutual funds		8,345		726		(13	)		9,058		332
Non-U.S. government securities		270		—		—			270		—
	$	236,726	$	3,079	$	(108	)	$	239,697	$	87,491

	December 31, 2011
	Available-for-Sale									Fair Market Value of Investments with  Unrealized Losses
	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value
	(in thousands)
U.S. government agency securities	$	83,070	$	152	$	(25	)	$	83,197	$	28,510
Corporate debt securities		43,077		1,893		(141	)		44,829		17,033
Commercial paper		22,083		2		(10	)		22,075		9,479
U.S. Treasury securities		14,141		39		—			14,180		—
Equity and debt mutual funds		7,876		477		(116	)		8,237		3,749
Certificates of deposit and time deposits		8,122		—		(5	)		8,117		5,800
Non-U.S. government securities		256		18		—			274		—
	$	178,625	$	2,581	$	(297	)	$	180,909	$	64,571

Schedule Of Reported Available-For-Sale Marketable Securities

Reported as follows:

	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value		Fair Market Value of Investments with Unrealized Losses
	(in thousands)
Marketable securities	$	105,954	$	12	$	(19	)	$	105,947	$	47,572
Long-term marketable securities		130,772		3,067		(89	)		133,750		39,919
	$	236,726	$	3,079	$	(108	)	$	239,697	$	87,491

Reported as follows:

	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value		Fair Market Value of Investments with Unrealized Losses
	(in thousands)
Marketable securities	$	96,518	$	24	$	(40	)	$	96,502	$	35,595
Long-term marketable securities		82,107		2,557		(257	)		84,407		28,976
	$	178,625	$	2,581	$	(297	)	$	180,909	$	64,571

Contractual Maturities of Available-For-Sale Marketable Securities

The contractual maturities of available-for-sale marketable securities as of July 1, 2012 were as follows:

	July 1, 2012
	Cost		Fair Market Value
Due within one year	$	107,961	$	107,954
Due after 1 year through 5 years		110,388		111,299
Due after 5 years through 10 years		2,662		2,836
Due after 10 years		15,715		17,608
Total	$	236,726	$	239,697

Schedule Of Fair Value Of Derivative Instruments

The following table summarizes the fair value of derivative instruments at July 1, 2012 and December 31, 2011.

	Balance Sheet Location		July 1, 2012		December 31, 2011
			(in thousands)
Derivatives not designated as hedging instruments:
Foreign exchange contracts		Other accrued liabilities	$	81	$	314
			$	81	$	314

Schedule Of Effect Of Derivative Instruments In Statement Of Operations Recognized

The following table summarizes the effect of derivative instruments in the statement of operations recognized during the three and six months ended July 1, 2012 and July 3, 2011. The table does not reflect the corresponding gains (losses) from the remeasurement of the monetary assets and liabilities denominated in foreign currencies.

	Location of Gains (Losses) Recognized in Statement of Operations		For the Three Months Ended						For the Six Months Ended
			July 1, 2012			July 3, 2011			July 1, 2012		July 3, 2011
			(in thousands)
Derivatives not designated as hedging instruments:
Foreign exchange contracts		Interest expense and other	$	(2,360	)	$	(166	)	$	520	$	661
			$	(2,360	)	$	(166	)	$	520	$	661

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Schedule of Fair Value of Derivative Instruments (Detail) (USD $) In Thousands, unless otherwise specified	Jul. 01, 2012	Dec. 31, 2011
Fair Value, Option, Quantitative Disclosures
Foreign exchange contracts derivatives not designated as hedging instruments at fair value, net	$ 81	$ 314
Other Accrued Liabilities
Fair Value, Option, Quantitative Disclosures
Foreign exchange contracts derivatives not designated as hedging instruments, liability at fair value	$ 81	$ 314

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Schedule of Condensed Consolidated Statements of Cash Flows (Detail) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011
Change In Accounting Principle
Net income	$ 144,951	$ 184,096
Less: Income from discontinued operations		1,703
Less: Gain on disposal of discontinued operations		24,371
Income from continuing operations	144,951	158,022
Depreciation	25,578	25,645
Amortization	43,744	20,816
Stock-based compensation	21,396	14,682
Provision for excess and obsolete inventory	10,927	6,343
Tax benefit related to stock options and restricted stock units	(7,600)	(3,717)
Other	(438)	1,684
Accounts receivable	(216,794)	(39,067)
Inventories	21,446	(15,006)
Deferred revenue and customer advances	(6,198)	(28,339)
Accounts payable and other accrued expenses	27,140	(9,275)
Retirement plan contributions	(2,550)	(5,245)
Accrued income taxes	29,958	5,406
Net cash provided by continuing operations	113,261	125,808
Net cash used for discontinued operations		(4,225)
Net cash provided by operating activities	113,261	121,583
Net cash used for investing activities	(115,455)	(83,469)
Net cash provided by financing activities	17,514	19,547
Increase in cash and cash equivalents	15,320	57,661
Cash and cash equivalents at beginning of period	573,736	397,737
Cash and cash equivalents at end of period	589,056	455,398
Originally Reported
Change In Accounting Principle
Net income		183,930
Less: Income from discontinued operations		1,545
Less: Gain on disposal of discontinued operations		24,371
Income from continuing operations		158,014
Depreciation		25,645
Amortization		25,289
Stock-based compensation		14,682
Provision for excess and obsolete inventory		6,343
Tax benefit related to stock options and restricted stock units		(3,717)
Other		1,422
Accounts receivable		(39,067)
Inventories		(15,006)
Other assets		(10,344)
Deferred revenue and customer advances		(28,339)
Accounts payable and other accrued expenses		(9,275)
Retirement plan contributions		(5,245)
Accrued income taxes		5,406
Net cash provided by continuing operations		125,808
Net cash used for discontinued operations		(4,225)
Net cash provided by operating activities		121,583
Net cash used for investing activities		(83,469)
Net cash provided by financing activities		19,547
Increase in cash and cash equivalents		57,661
Cash and cash equivalents at beginning of period		397,737
Cash and cash equivalents at end of period		455,398
Effect Of Accounting Change
Change In Accounting Principle
Net income		166
Less: Income from discontinued operations		158
Income from continuing operations		8
Amortization		(4,473)
Other		4,465
As Adjusted
Change In Accounting Principle
Net income		184,096
Less: Income from discontinued operations		1,703
Less: Gain on disposal of discontinued operations		24,371
Income from continuing operations		158,022
Depreciation		25,645
Amortization		20,816
Stock-based compensation		14,682
Provision for excess and obsolete inventory		6,343
Tax benefit related to stock options and restricted stock units		(3,717)
Other		5,887
Accounts receivable		(39,067)
Inventories		(15,006)
Other assets		(10,344)
Deferred revenue and customer advances		(28,339)
Accounts payable and other accrued expenses		(9,275)
Retirement plan contributions		(5,245)
Accrued income taxes		5,406
Net cash provided by continuing operations		125,808
Net cash used for discontinued operations		(4,225)
Net cash provided by operating activities		121,583
Net cash used for investing activities		(83,469)
Net cash provided by financing activities		19,547
Increase in cash and cash equivalents		57,661
Cash and cash equivalents at beginning of period		397,737
Cash and cash equivalents at end of period		$ 455,398

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Deferred Revenue and Customer Advances (Tables)

6 Months Ended

Jul. 01, 2012

Schedule Of Deferred Revenue And Customer Advances

Deferred revenue and customer advances consist of the following and are included in short and long-term deferred revenue and customer advances.

	July 1, 2012		December 31, 2011
	(in thousands)
Customer advances	$	54,149	$	70,001
Maintenance, training and extended warranty		45,826		33,953
Undelivered elements		5,314		7,939
Acceptance		724		318
Total deferred revenue and customer advances	$	106,013	$	112,211

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Product Warranty (Tables)

6 Months Ended

Jul. 01, 2012

Schedule Of Product Warranty

The balance below is included in other accrued liabilities.

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
	(in thousands)
Balance at beginning of period	$	8,722		$	9,502		$	8,154		$	9,886
Accruals for warranties issued during the period		5,649			3,976			9,425			7,553
Adjustments related to pre-existing warranties		403			(1,116	)		143			(2,072	)
Settlements made during the period		(3,727	)		(3,100	)		(6,675	)		(6,105	)
Balance at end of period	$	11,047		$	9,262		$	11,047		$	9,262

Schedule Of Extended Product Warranty

The balance below is included in deferred revenue and customer advances and long-term other accrued liabilities.

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
	(in thousands)
Balance at beginning of period	$	12,927		$	9,870		$	12,742		$	8,972
Deferral of new extended warranty revenue		9,935			1,861			12,282			3,798
Recognition of extended warranty deferred revenue		(2,108	)		(1,423	)		(4,270	)		(2,462	)
Balance at end of period	$	20,754		$	10,308		$	20,754		$	10,308

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The Company

6 Months Ended

Jul. 01, 2012

The Company

A. The Company

Teradyne, Inc. (“Teradyne”) is a leading global supplier of automatic test equipment. Teradyne’s automatic test equipment products and services include:

• semiconductor test (“Semiconductor Test”) systems,

• military/aerospace (“Mil/Aero”) test instrumentation and systems, storage test (“Storage Test”) systems, and circuit-board test and inspection (“Commercial Board Test”) systems (collectively these products represent “Systems Test Group”), and

• wireless test (“Wireless Test”) systems.

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Stock-Based Compensation (Tables)

6 Months Ended

Jul. 01, 2012

Stock Option

Schedule Of Estimated Fair Value Of Stock Options Assumptions

The fair value of stock options was estimated using the Black-Scholes option-pricing model with the following assumptions:

	For the Six Months Ended
	July 1, 2012			July 3, 2011
Expected life (years)		3.50			4.00
Interest rate		0.4	%		1.5	%
Volatility-historical		56.0	%		52.1	%
Dividend yield		0.0	%		0.0	%

Stock Purchase Rights

Schedule Of Estimated Fair Value Of Stock Options Assumptions

The fair value of the employees’ purchase rights was estimated using the Black-Scholes option-pricing model with the following assumptions:

	For the Six Months Ended
	July 1, 2012			July 3, 2011
Expected life (years)		0.5			0.5
Interest rate		0.06	%		0.19	%
Volatility-historical		52.6	%		41.5	%
Dividend yield		0.0	%		0.0	%

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Schedule of Condensed Consolidated Statements of Operations (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended				6 Months Ended
	Jul. 01, 2012		Jul. 03, 2011		Jul. 01, 2012		Jul. 03, 2011
Change In Accounting Principle
Net revenues	$ 548,284		$ 410,519		$ 944,952		$ 787,680
Cost of revenues	238,778		195,841		444,520		380,110
Gross profit	309,506		214,678		500,432		407,570
Engineering and development	66,532		48,392		126,667		95,536
Selling and administrative	73,366		57,880		141,143		115,611
Acquired intangible asset amortization	18,429		7,291		36,858		14,582
Total operating expenses	152,065		114,842		296,581		227,421
Income from operations	157,441		99,836		203,851		180,149
Interest income	874		1,403		1,767		2,690
Interest expense and other, net	(6,323)		(5,316)		(12,382)		(11,492)
Income from continuing operations before income taxes	151,992	[1],[2]	95,923	[1],[2]	193,236	[1],[2]	171,347	[1],[2]
Provision for income taxes	40,605		7,839		48,285		13,325
Income from continuing operations	111,387		88,084		144,951		158,022
Income from discontinued operations before income taxes							1,436
Benefit from income taxes							(267)
Income from discontinued operations							1,703
Gain on disposal of discontinued operations (net of tax of $4,578)			(832)				24,371
Net income	111,387		87,252		144,951		184,096
Net income per common share from continuing operations, Basic	$ 0.60		$ 0.48		$ 0.78		$ 0.85
Net income per common share from continuing operations, Diluted	$ 0.49		$ 0.38		$ 0.63		$ 0.68
Net income per common share, Basic	$ 0.60		$ 0.47		$ 0.78		$ 0.99
Net income per common share, Diluted	$ 0.49		$ 0.38		$ 0.63		$ 0.80
Weighted average common share-basic	186,573		185,367		186,205		185,044
Weighted average common share-diluted	229,646		230,452		230,399		231,266
Originally Reported
Change In Accounting Principle
Net revenues			410,519				787,680
Cost of revenues			195,433				380,185
Gross profit			215,086				407,495
Engineering and development			47,393				95,370
Selling and administrative			57,481				115,710
Acquired intangible asset amortization			7,291				14,582
Restructuring and other			1,279				1,692
Total operating expenses			113,444				227,354
Income from operations			101,642				180,141
Interest income			1,403				2,690
Interest expense and other, net			(5,316)				(11,492)
Income from continuing operations before income taxes			97,729				171,339
Provision for income taxes			7,839				13,325
Income from continuing operations			89,890				158,014
Income from discontinued operations before income taxes							1,278
Benefit from income taxes							(267)
Income from discontinued operations							1,545
Gain on disposal of discontinued operations (net of tax of $4,578)			(832)				24,371
Net income			89,058				183,930
Net income per common share from continuing operations, Basic			$ 0.48				$ 0.85
Net income per common share from continuing operations, Diluted			$ 0.39				$ 0.68
Net income per common share, Basic			$ 0.48				$ 0.99
Net income per common share, Diluted			$ 0.39				$ 0.80
Weighted average common share-basic			185,367				185,044
Weighted average common share-diluted			230,452				231,266
Effect Of Accounting Change
Change In Accounting Principle
Cost of revenues			408				(75)
Gross profit			(408)				75
Engineering and development			999				166
Selling and administrative			399				(99)
Total operating expenses			1,398				67
Income from operations			(1,806)				8
Income from continuing operations before income taxes			(1,806)				8
Income from continuing operations			(1,806)				8
Income from discontinued operations before income taxes							158
Income from discontinued operations							158
Net income			(1,806)				166
Net income per common share from continuing operations, Diluted			$ (0.01)
Net income per common share, Basic			$ (0.01)
Net income per common share, Diluted			$ (0.01)
As Adjusted
Change In Accounting Principle
Net revenues			410,519				787,680
Cost of revenues			195,841				380,110
Gross profit			214,678				407,570
Engineering and development			48,392				95,536
Selling and administrative			57,880				115,611
Acquired intangible asset amortization			7,291				14,582
Restructuring and other			1,279				1,692
Total operating expenses			114,842				227,421
Income from operations			99,836				180,149
Interest income			1,403				2,690
Interest expense and other, net			(5,316)				(11,492)
Income from continuing operations before income taxes			95,923				171,347
Provision for income taxes			7,839				13,325
Income from continuing operations			88,084				158,022
Income from discontinued operations before income taxes							1,436
Benefit from income taxes							(267)
Income from discontinued operations							1,703
Gain on disposal of discontinued operations (net of tax of $4,578)			(832)				24,371
Net income			$ 87,252				$ 184,096
Net income per common share from continuing operations, Basic			$ 0.48				$ 0.85
Net income per common share from continuing operations, Diluted			$ 0.38				$ 0.68
Net income per common share, Basic			$ 0.47				$ 0.99
Net income per common share, Diluted			$ 0.38				$ 0.80
Weighted average common share-basic			185,367				185,044
Weighted average common share-diluted			230,452				231,266

[1] Pension and post retirement actuarial gains and losses, interest income, and interest expense and other are included in Corporate and Eliminations.

[2] Included in the income (loss) from continuing operations before income taxes for each of the segments are charges and credits for the three and six months ended July 1, 2012 and July 3, 2011 that include restructuring and other, net, and provision for excess and obsolete inventory, as follows:

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Schedule of Available for Sale Marketable Securities (Detail) (USD $)	Jul. 01, 2012	Dec. 31, 2011
Schedule of Available-for-sale Securities
Available-for-sale marketable securities, Cost	$ 236,726,000	$ 178,625,000
Available-for-sale marketable securities, Unrealized Gain	3,079,000	2,581,000
Available-for-sale marketable securities, Unrealized (Loss)	(108,000)	(297,000)
Available-for-sale marketable securities, Fair Market Value	239,697,000	180,909,000
Available-for-sale marketable securities, Fair Market Value of Investments with Unrealized Losses	87,491,000	64,571,000
U.S. Government Agency Securities
Schedule of Available-for-sale Securities
Available-for-sale marketable securities, Cost	112,162,000	83,070,000
Available-for-sale marketable securities, Unrealized Gain	168,000	152,000
Available-for-sale marketable securities, Unrealized (Loss)	(15,000)	(25,000)
Available-for-sale marketable securities, Fair Market Value	112,315,000	83,197,000
Available-for-sale marketable securities, Fair Market Value of Investments with Unrealized Losses	49,867,000	28,510,000
Corporate Debt Securities
Schedule of Available-for-sale Securities
Available-for-sale marketable securities, Cost	46,890,000	43,077,000
Available-for-sale marketable securities, Unrealized Gain	2,071,000	1,893,000
Available-for-sale marketable securities, Unrealized (Loss)	(70,000)	(141,000)
Available-for-sale marketable securities, Fair Market Value	48,891,000	44,829,000
Available-for-sale marketable securities, Fair Market Value of Investments with Unrealized Losses	18,236,000	17,033,000
Commercial Paper
Schedule of Available-for-sale Securities
Available-for-sale marketable securities, Cost	30,994,000	22,083,000
Available-for-sale marketable securities, Unrealized Gain	5,000	2,000
Available-for-sale marketable securities, Unrealized (Loss)	(9,000)	(10,000)
Available-for-sale marketable securities, Fair Market Value	30,990,000	22,075,000
Available-for-sale marketable securities, Fair Market Value of Investments with Unrealized Losses	13,234,000	9,479,000
U.S. Treasury Securities
Schedule of Available-for-sale Securities
Available-for-sale marketable securities, Cost	28,564,000	14,141,000
Available-for-sale marketable securities, Unrealized Gain	109,000	39,000
Available-for-sale marketable securities, Fair Market Value	28,673,000	14,180,000
Certificates Of Deposit And Time Deposits
Schedule of Available-for-sale Securities
Available-for-sale marketable securities, Cost	9,501,000	8,122,000
Available-for-sale marketable securities, Unrealized (Loss)	(1,000)	(5,000)
Available-for-sale marketable securities, Fair Market Value	9,500,000	8,117,000
Available-for-sale marketable securities, Fair Market Value of Investments with Unrealized Losses	5,822,000	5,800,000
Equity And Debt Mutual Funds
Schedule of Available-for-sale Securities
Available-for-sale marketable securities, Cost	8,345,000	7,876,000
Available-for-sale marketable securities, Unrealized Gain	726,000	477,000
Available-for-sale marketable securities, Unrealized (Loss)	(13,000)	(116,000)
Available-for-sale marketable securities, Fair Market Value	9,058,000	8,237,000
Available-for-sale marketable securities, Fair Market Value of Investments with Unrealized Losses	332,000	3,749,000
Non-U.S. Government Securities
Schedule of Available-for-sale Securities
Available-for-sale marketable securities, Cost	270,000	256,000
Available-for-sale marketable securities, Unrealized Gain		18,000
Available-for-sale marketable securities, Fair Market Value	$ 270,000	$ 274,000

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Schedule of Restructuring and Other Net (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		12 Months Ended
	Jul. 01, 2012	Apr. 01, 2012	Dec. 31, 2011
Restructuring Cost and Reserve
Ending balance	$ 1,750
Pre-2011 Activities
Restructuring Cost and Reserve
Beginning Balance	1,673	1,862	3,975
Provision			117
Change in estimate			(330)
Cash payments	(209)	(189)	(1,900)
Ending balance	1,464	1,673	1,862
Q1 2011 Activity
Restructuring Cost and Reserve
Beginning Balance		96
Provision			572
Cash payments		(96)	(476)
Ending balance			96
Q2 2011 Activity
Restructuring Cost and Reserve
Beginning Balance		229
Provision			344
Cash payments		(229)	(115)
Ending balance			229
Q2 2012 Activity
Restructuring Cost and Reserve
Provision	286
Ending balance	286
Severance And Benefits
Restructuring Cost and Reserve
Ending balance	286
Severance And Benefits | Pre-2011 Activities
Restructuring Cost and Reserve
Beginning Balance			712
Provision			117
Change in estimate			155
Cash payments			(984)
Severance And Benefits | Q1 2011 Activity
Restructuring Cost and Reserve
Beginning Balance		96
Provision			572
Cash payments		(96)	(476)
Ending balance			96
Severance And Benefits | Q2 2011 Activity
Restructuring Cost and Reserve
Beginning Balance		229
Provision			344
Cash payments		(229)	(115)
Ending balance			229
Severance And Benefits | Q2 2012 Activity
Restructuring Cost and Reserve
Provision	286
Ending balance	286
Facility Exit Costs
Restructuring Cost and Reserve
Ending balance	1,464
Facility Exit Costs | Pre-2011 Activities
Restructuring Cost and Reserve
Beginning Balance	1,673	1,862	3,263
Change in estimate			(485)
Cash payments	(209)	(189)	(916)
Ending balance	$ 1,464	$ 1,673	$ 1,862

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CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Jul. 01, 2012	Dec. 31, 2011
Current assets:
Cash and cash equivalents	$ 589,056	$ 573,736
Marketable securities	105,947	96,502
Accounts receivable, less allowance for doubtful accounts of $4,160 and $4,102 at July 1, 2012 and December 31, 2011, respectively	346,124	129,330
Inventories:
Raw materials	92,994	109,315
Assemblies in process	27,078	33,856
Finished goods	17,826	16,892
Inventory, Net, Total	137,898	160,063
Deferred tax assets	56,888	53,948
Prepayments and other current assets	80,895	86,308
Total current assets	1,316,808	1,099,887
Property, plant and equipment	827,608	798,194
Less: Accumulated depreciation	579,608	565,987
Net property, plant and equipment	248,000	232,207
Long-term marketable securities	133,750	84,407
Retirement plan assets	7,182	8,840
Intangible assets, net	356,117	392,975
Goodwill	352,778	352,778
Other assets	20,035	17,545
Total assets	2,434,670	2,188,639
Current liabilities:
Accounts payable	117,343	69,842
Accrued employees' compensation and withholdings	80,118	90,427
Deferred revenue and customer advances	83,710	78,670
Contingent consideration	54,662	68,892
Other accrued liabilities	64,298	62,420
Accrued income taxes	23,218	860
Current debt	2,522	2,573
Total current liabilities	425,871	373,684
Long-term deferred revenue and customer advances	22,303	33,541
Retirement plan liabilities	77,295	76,638
Deferred tax liabilities	37,915	16,049
Long-term other accrued liabilities	20,573	23,711
Long-term debt	165,283	159,956
Total liabilities	749,240	683,579
Commitments and contingencies (Note O)
SHAREHOLDERS' EQUITY
Common stock, $0.125 par value, 1,000,000 shares authorized, 187,213 shares and 183,587 shares issued and outstanding at July 1, 2012 and December 31, 2011, respectively	23,402	22,948
Additional paid-in capital	1,327,574	1,293,130
Accumulated other comprehensive income	5,267	4,746
Retained earnings	329,187	184,236
Total shareholders' equity	1,685,430	1,505,060
Total liabilities and shareholders' equity	$ 2,434,670	$ 2,188,639

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Discontinued Operations - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	1 Months Ended
	Apr. 03, 2011
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations
Cash received from sale of business	$ 40.2

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
Net income	$ 111,387	$ 87,252	$ 144,951	$ 184,096
Other comprehensive income, net of tax:
Foreign currency translation reclassification adjustment included in net income				2,266
Unrealized gains on marketable securities:
Unrealized gains on marketable securities arising during period	452	1,421	1,196	1,620
Less: Reclassification adjustment for gains included in net income	(24)	(126)	(490)	(310)
Unrealized gains on marketable securities	428	1,295	706	1,310
Defined benefit pension and post-retirement plans:
Amortization of prior service (benefit) cost included in net periodic pension and post-retirement costs	(92)	5	(183)	11
Other comprehensive income	336	1,300	523	3,587
Comprehensive income	$ 111,723	$ 88,552	$ 145,474	$ 187,683

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Components of Convertible Senior Notes (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011	Dec. 31, 2011
Debt Instrument
Debt principal	$ 190,000		$ 190,000		$ 190,000
Unamortized debt discount	27,238		27,238		33,902
Net carrying amount of the convertible debt	162,762		162,762		156,098
Contractual interest expense	2,138	2,138	4,299	4,347
Amortization of the discount component and debt issue fees	3,592	3,160	7,071	6,221
Total interest expense on the convertible debt	$ 5,730	$ 5,298	$ 11,370	$ 10,568

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Restructuring and Other, Net (Tables)

6 Months Ended

Jul. 01, 2012

Schedule Of Restructuring And Other, Net

The table below represents activity related to these actions.

	Severance and Benefits			Facility Exit Costs			Total
	(in thousands)
Pre-2011 Activities
Balance at December 31, 2010	$	712		$	3,263		$	3,975
Provision		117			—			117
Change in estimate		155			(485	)		(330	)
Cash payments		(984	)		(916	)		(1,900	)
Balance at December 31, 2011		—			1,862			1,862
Cash payments		—			(189	)		(189	)
Balance at April 1, 2012		—			1,673			1,673
Cash payments		—			(209	)		(209	)
Balance at July 1, 2012	$	—		$	1,464		$	1,464
2011 Activities
Q1 2011 Activity:
Provision	$	572		$	—		$	572
Cash payments		(476	)		—			(476	)
Balance at December 31, 2011		96			—			96
Cash payments		(96	)		—			(96	)
Balance at April 1, 2012	$	—		$	—		$	—
Q2 2011 Activity:
Provision	$	344		$	—		$	344
Cash payments		(115	)		—			(115	)
Balance at December 31, 2011		229			—			229
Cash payments		(229	)		—			(229	)
Balance at April 1, 2012	$	—		$	—		$	—
2012 Activities
Q2 2012 Activity:
Provision	$	286		$	—		$	286
Balance at July 1, 2012	$	286		$	—		$	286
Balance at July 1, 2012	$	286		$	1,464		$	1,750

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Schedule of Amortizable Intangible Assets (Detail) (USD $) In Thousands, unless otherwise specified	6 Months Ended	12 Months Ended
	Jul. 01, 2012	Dec. 31, 2011
Finite-Lived Intangible Assets
Gross Carrying Amount	$ 537,966	$ 537,966
Accumulated Amortization	181,849	144,991
Net Carrying Amount	356,117	392,975
Weighted Average Useful Life, years	7 years	7 years
Developed Technology
Finite-Lived Intangible Assets
Gross Carrying Amount	358,155	358,155
Accumulated Amortization	117,363	91,391
Net Carrying Amount	240,792	266,764
Weighted Average Useful Life, years	6 years 3 months 18 days	6 years 3 months 18 days
Customer Relationships And Service And Software Maintenance Contracts
Finite-Lived Intangible Assets
Gross Carrying Amount	144,971	144,971
Accumulated Amortization	54,347	45,230
Net Carrying Amount	90,624	99,741
Weighted Average Useful Life, years	8 years	8 years
Trade Names And Trademarks
Finite-Lived Intangible Assets
Gross Carrying Amount	33,840	33,840
Accumulated Amortization	9,139	7,370
Net Carrying Amount	24,701	26,470
Weighted Average Useful Life, years	9 years	9 years
Customer Backlog
Finite-Lived Intangible Assets
Gross Carrying Amount	1,000	1,000
Accumulated Amortization	$ 1,000	$ 1,000
Weighted Average Useful Life, years	4 months 24 days	4 months 24 days

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Commitments and Contingencies

6 Months Ended

Jul. 01, 2012

Commitments and Contingencies

O. Commitments and Contingencies

Purchase Commitments

As of July 1, 2012, Teradyne had entered into purchase commitments for certain components and materials. The purchase commitments aggregate to approximately $281.4 million, of which $280.0 million is for less than one year.

Legal Claims

Teradyne is subject to various legal proceedings and claims which have arisen in the ordinary course of business. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on Teradyne’s results of operations, financial condition or cash flows.

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Retirement Plans (Tables)

6 Months Ended

Jul. 01, 2012

Defined Benefit Pension Plans

Schedule of Net Periodic Pension Cost

Components of net periodic pension cost for all plans were as follows:

	For the Three Months Ended						For the Six Months Ended
	July 1,  2012			July 3,  2011			July 1,  2012			July 3,  2011
	(in thousands)
Service cost	$	643		$	668		$	1,357		$	1,436
Interest cost		4,125			4,457			8,185			8,784
Expected return on plan assets		(4,082	)		(3,906	)		(8,164	)		(7,818	)
Amortization of unrecognized prior service cost		58			155			116			310
Settlement		—			680			—			680
Actuarial loss		3,146			4,279			3,146			4,279
Total net periodic pension cost	$	3,890		$	6,333		$	4,640		$	7,671

Post-Retirement Benefit Plans

Schedule of Net Periodic Pension Cost

Components of net periodic post-retirement cost were as follows:

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
	(in thousands)
Service cost	$	15		$	14		$	34		$	30
Interest cost		108			134			219			270
Amortization of unrecognized prior service benefit		(150	)		(150	)		(299	)		(299	)
Actuarial gain		(92	)		(76	)		(92	)		(76	)
Total net periodic post-retirement cost	$	(119	)	$	(78	)	$	(138	)	$	(75	)

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Stock Repurchase Program

6 Months Ended

Jul. 01, 2012

Stock Repurchase Program

Q. Stock Repurchase Program

In November 2010, Teradyne’s board of directors authorized a stock repurchase program for up to $200 million. In the three and six months ended July 1, 2012 and July 3, 2011, Teradyne did not repurchase any shares. Cumulatively, as of July 1, 2012, Teradyne has repurchased 2.6 million shares of common stock for $31.2 million at an average price of $11.84.

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Net Income Per Common Share (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended				6 Months Ended
	Jul. 01, 2012		Jul. 03, 2011		Jul. 01, 2012		Jul. 03, 2011
Net Income Loss Per Common Share
Income from continuing operations	$ 111,387		$ 88,084		$ 144,951		$ 158,022
Income from discontinued operations							1,703
(Loss) Gain on disposal of discontinued operations			(832)				24,371
Net income for basic net income per share	$ 111,387		$ 87,252		$ 144,951		$ 184,096
Weighted average common shares-basic	186,573		185,367		186,205		185,044
Incremental shares from assumed conversion of convertible notes	22,301	[1]	22,711	[1]	22,651	[1]	23,036	[1]
Convertible note hedge warrant shares	17,340	[2]	17,914	[2]	17,829	[2]	18,368	[2]
Restricted stock units	1,171		3,877		1,405		4,222
Stock options	2,160		469		2,247		508
Employee stock purchase rights	101		114		62		88
Dilutive potential common shares	43,073		45,085		44,194		46,222
Weighted average common shares-diluted	229,646		230,452		230,399		231,266
Net income per common share-basic, Continuing operations	$ 0.60		$ 0.48		$ 0.78		$ 0.85
Net income per common share-basic, Discontinued operations			$ (0.01)				$ 0.14
Net income per common share-basic, Total	$ 0.60		$ 0.47		$ 0.78		$ 0.99
Net income per common share-diluted, Continuing operations	$ 0.49		$ 0.38		$ 0.63		$ 0.68
Net income per common share-diluted, Discontinued operations							$ 0.12
Net income per common share-diluted, Total	$ 0.49		$ 0.38		$ 0.63		$ 0.80

[1] Incremental shares from assumed conversion of the convertible notes for the three and six months ended July 1, 2012 and July 3, 2011 are calculated using the difference between the average Teradyne stock price for the period and the conversion price of $5.48, multiplied by the 34.7 million shares that would be issued upon conversion. The result of this calculation, representing the total intrinsic value of the convertible debt, is divided by the average Teradyne stock price for the period.

[2] Convertible note hedge warrant shares for the three and six months ended July 1, 2012 and July 3, 2011 are calculated using the difference between the average Teradyne stock price for the period and the warrant price of $7.67, multiplied by the 34.7 million shares that would be issued upon conversion. The result of this calculation, representing the total intrinsic value of the warrant, is divided by the average Teradyne stock price for the period.

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011
Cash flows from operating activities:
Net income	$ 144,951	$ 184,096
Less: Income from discontinued operations		1,703
Less: Gain on disposal of discontinued operations		24,371
Income from continuing operations	144,951	158,022
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
Depreciation	25,578	25,645
Amortization	43,744	20,816
Stock-based compensation	21,396	14,682
Deferred taxes	15,937
Provision for excess and obsolete inventory	10,927	6,343
Non cash charge for the sale of inventories revalued at the date of acquisition	6,089
Contingent consideration adjustment	(8,406)
Tax benefit related to stock options and restricted stock units	(7,600)	(3,717)
Retirement plans actuarial losses	3,054	4,203
Other	(438)	1,684
Changes in operating assets and liabilities, net of businesses sold:
Accounts receivable	(216,794)	(39,067)
Inventories	21,446	(15,006)
Other assets	5,027	(10,344)
Deferred revenue and customer advances	(6,198)	(28,339)
Accounts payable and other accrued expenses	27,140	(9,275)
Retirement plans contributions	(2,550)	(5,245)
Accrued income taxes	29,958	5,406
Net cash provided by continuing operations	113,261	125,808
Net cash used for discontinued operations		(4,225)
Net cash provided by operating activities	113,261	121,583
Cash flows from investing activities:
Purchases of property, plant and equipment	(57,804)	(44,467)
Purchases of available-for-sale marketable securities	(156,771)	(498,541)
Proceeds from maturities of available-for-sale marketable securities	59,405	366,144
Proceed from sales of available-for-sale marketable securities	39,715	54,335
Net cash used for continuing operations	(115,455)	(122,531)
Net cash provided by discontinued operations		39,062
Net cash used for investing activities	(115,455)	(83,469)
Cash flows from financing activities:
Issuance of common stock under employee stock option and stock purchase plans	16,984	17,052
Tax benefit related to stock options and restricted stock units	7,600	3,717
Payments of long-term debt	(1,246)	(1,222)
Payments of contingent consideration	(5,824)
Net cash provided by financing activities	17,514	19,547
Increase in cash and cash equivalents	15,320	57,661
Cash and cash equivalents at beginning of period	573,736	397,737
Cash and cash equivalents at end of period	$ 589,056	$ 455,398

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) In Thousands, except Per Share data, unless otherwise specified	Jul. 01, 2012	Dec. 31, 2011
Accounts receivable, allowance for doubtful accounts	$ 4,160	$ 4,102
Common stock, par value	$ 0.125	$ 0.125
Common stock, shares authorized	1,000,000	1,000,000
Common stock, shares issued	187,213	183,587
Common stock, shares outstanding	187,213	183,587

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Stock-Based Compensation

6 Months Ended

Jul. 01, 2012

Stock-Based Compensation

J. Stock-Based Compensation

Restricted stock unit awards granted to employees vest in equal installments over four years. A portion of restricted stock unit awards granted to executive officers is subject to service-based vesting and a portion of the awards is subject to performance-based vesting. The percentage level of performance satisfied for performance-based grants is assessed on or near the anniversary of the grant date and, in turn, that percentage level determines the number of performance-based restricted stock units available for vesting over the vesting period; portions of the performance-based grants not available for vesting are forfeited. Service-based stock options vest in equal installments over four years, and have a term of seven years from the date of grant.

During the six months ended July 1, 2012, Teradyne granted 1.6 million of restricted stock unit awards to employees at a weighted average grant date fair value of $16.83 and 0.2 million of service-based stock options to executive officers at a weighted average grant date fair value of $6.85.

During the six months ended July 3, 2011, Teradyne granted 1.7 million of restricted stock unit awards to employees at a weighted average grant date fair value of $16.20 and 0.1 million of service-based stock options to executive officers at a weighted average grant date fair value of $6.74.

The fair value of stock options was estimated using the Black-Scholes option-pricing model with the following assumptions:

	For the Six Months Ended
	July 1, 2012			July 3, 2011
Expected life (years)		3.50			4.00
Interest rate		0.4	%		1.5	%
Volatility-historical		56.0	%		52.1	%
Dividend yield		0.0	%		0.0	%

Teradyne determined the stock options’ expected life based upon historical exercise data for executive officers, the age of the executive officers and the terms of the stock option grant. Volatility was determined using historical volatility for a period equal to the expected life. The risk-free rate was determined using the U.S. Treasury yield curve in effect at the time of grant.

The weighted-average fair value of employee stock purchase rights granted in the first six months of 2012 and 2011 was $4.09 and $3.66, respectively. The fair value of the employees’ purchase rights was estimated using the Black-Scholes option-pricing model with the following assumptions:

	For the Six Months Ended
	July 1, 2012			July 3, 2011
Expected life (years)		0.5			0.5
Interest rate		0.06	%		0.19	%
Volatility-historical		52.6	%		41.5	%
Dividend yield		0.0	%		0.0	%

XML

Document and Entity Information	6 Months Ended
	Jul. 01, 2012	Aug. 06, 2012
Document Information
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jul. 01, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q2
Trading Symbol	TER
Entity Registrant Name	TERADYNE, INC
Entity Central Index Key	0000097210
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		187,592,476

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Intangible Assets

6 Months Ended

Jul. 01, 2012

Intangible Assets

K. Intangible Assets

Amortizable intangible assets consist of the following and are included in intangible assets on the balance sheet:

	July 1, 2012
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Useful Life
	(in thousands)
Developed technology	$	358,155	$	117,363	$	240,792		6.3 years
Customer relationships and service and software maintenance contracts		144,971		54,347		90,624		8.0 years
Trade names and trademarks		33,840		9,139		24,701		9.0 years
Customer backlog		1,000		1,000		—		0.4 years
Total intangible assets	$	537,966	$	181,849	$	356,117		7.0 years

	December 31, 2011
	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Weighted Average Useful Life
	(in thousands)
Developed technology	$	358,155	$	91,391	$	266,764		6.3 years
Customer relationships and service and software maintenance contracts		144,971		45,230		99,741		8.0 years
Trade names and trademarks		33,840		7,370		26,470		9.0 years
Customer backlog		1,000		1,000		—		0.4 years
Total intangible assets	$	537,966	$	144,991	$	392,975		7.0 years

Aggregate intangible asset amortization expense was $18.4 million and $36.9 million, respectively, for the three and six months ended July 1, 2012 and $7.3 million and $14.6 million, respectively, for the three and six months ended July 3, 2011. Estimated intangible asset amortization expense for each of the five succeeding fiscal years is as follows:

Year	Amortization Expense
	(in thousands)
2012 (remainder)	$	36,650
2013		72,459
2014		69,374
2015		52,351
2016		52,351

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended				6 Months Ended
	Jul. 01, 2012		Jul. 03, 2011		Jul. 01, 2012		Jul. 03, 2011
Net revenues:
Products	$ 480,578		$ 341,316		$ 811,469		$ 657,035
Services	67,706		69,203		133,483		130,645
Total net revenues	548,284		410,519		944,952		787,680
Cost of revenues:
Cost of products	206,498		160,403		380,499		313,283
Cost of services	32,280		35,438		64,021		66,827
Total cost of revenues	238,778		195,841		444,520		380,110
Gross profit	309,506		214,678		500,432		407,570
Operating expenses:
Engineering and development	66,532		48,392		126,667		95,536
Selling and administrative	73,366		57,880		141,143		115,611
Acquired intangible asset amortization	18,429		7,291		36,858		14,582
Restructuring and other, net	(6,262)		1,279		(8,087)		1,692
Total operating expenses	152,065		114,842		296,581		227,421
Income from operations	157,441		99,836		203,851		180,149
Interest income	874		1,403		1,767		2,690
Interest expense and other	(6,323)		(5,316)		(12,382)		(11,492)
Income from continuing operations before income taxes	151,992	[1],[2]	95,923	[1],[2]	193,236	[1],[2]	171,347	[1],[2]
Income tax provision	40,605		7,839		48,285		13,325
Income from continuing operations	111,387		88,084		144,951		158,022
Income from discontinued operations before income taxes							1,436
Income tax benefit							(267)
Income from discontinued operations							1,703
(Loss) Gain on disposal of discontinued operations (net of income tax of $0, $0, $0, $4,578, respectively)			(832)				24,371
Net income	$ 111,387		$ 87,252		$ 144,951		$ 184,096
Income per common share from continuing operations:
Basic	$ 0.60		$ 0.48		$ 0.78		$ 0.85
Diluted	$ 0.49		$ 0.38		$ 0.63		$ 0.68
Net income per common share:
Basic	$ 0.60		$ 0.47		$ 0.78		$ 0.99
Diluted	$ 0.49		$ 0.38		$ 0.63		$ 0.80
Weighted average common share-basic	186,573		185,367		186,205		185,044
Weighted average common share-diluted	229,646		230,452		230,399		231,266

[1] Pension and post retirement actuarial gains and losses, interest income, and interest expense and other are included in Corporate and Eliminations.

[2] Included in the income (loss) from continuing operations before income taxes for each of the segments are charges and credits for the three and six months ended July 1, 2012 and July 3, 2011 that include restructuring and other, net, and provision for excess and obsolete inventory, as follows:

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Discontinued Operations

6 Months Ended

Jul. 01, 2012

Discontinued Operations

E. Discontinued Operations

On March 21, 2011, Teradyne completed the sale of its Diagnostic Solutions business unit, which was included in the Systems Test Group segment, to SPX Corporation for $40.2 million in cash. Teradyne sold this business as its growth potential as a stand-alone business within Teradyne was significantly less than if it was part of a larger automotive supplier. The financial information for Diagnostic Solutions has been reclassified to discontinued operations for all periods presented. Net revenues and income from discontinued operations for the three and six months ended July 3, 2011 were as follows:

	For the Three  Months Ended July 3, 2011			For the Six  Months Ended July 3, 2011
	(in thousands)
Net revenues	$	—		$	9,086
Income from discontinued operations before income taxes	$	—		$	1,436
(Loss) Gain from disposal of discontinued operations before income taxes		(832	)		28,949
Income tax provision		—			4,311
(Loss) Income from discontinued operations	$	(832	)	$	26,074

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Recently Issued Accounting Pronouncements

6 Months Ended

Jul. 01, 2012

Recently Issued Accounting Pronouncements

D. Recently Issued Accounting Pronouncements

In December 2011, the FASB issued ASU No. 2011-11, “Disclosures about Offsetting Assets and Liabilities.” This ASU is intended to enhance the understanding of the effects of netting arrangements on an entity’s financial statements, including financial instruments and derivative instruments that are either offset or subject to a master netting arrangement. The scope of this ASU includes derivatives, sale and repurchase agreements, reverse sale and repurchase agreements, and securities borrowing and lending arrangements. The provisions of this ASU are effective for interim and annual periods beginning on or after January 1, 2013.

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Segment Information

6 Months Ended

Jul. 01, 2012

Segment Information

P. Segment Information

Teradyne has three operating segments (Semiconductor Test, Systems Test Group and Wireless Test), which are its reportable segments. The Semiconductor Test segment includes operations related to the design, manufacturing and marketing of semiconductor test products and services. The Systems Test Group segment includes operations related to design, manufacturing and marketing of products and services for military/aerospace instrumentation test, storage test and circuit-board test. The Wireless Test segment includes operations related to design, manufacturing and marketing of wireless test products and services. Each operating segment has a segment manager who is directly accountable to and maintains regular contact with Teradyne’s chief operating decision maker (Teradyne’s chief executive officer) to discuss operating activities, financial results, forecasts, and plans for the segment.

Teradyne evaluates performance based on several factors, of which the primary financial measure is business segment income before income taxes. The accounting policies of the business segments are the same as those described in Note B “Accounting Policies” in Teradyne’s Annual Report on Form 10-K for the year ended December 31, 2011. Segment information is as follows:

	Semiconductor Test		Systems Test Group		Wireless Test		Corporate and Eliminations			Consolidated
	(in thousands)
Three months ended July 1, 2012:
Net revenues	$	365,058	$	71,298	$	111,928	$	—		$	548,284
Income (loss) from continuing operations before income taxes(1)(2)		91,249		11,628		51,139		(2,024	)		151,992
Three months ended July 3, 2011:
Net revenues	$	343,096	$	67,423	$	—	$	—		$	410,519
Income (loss) from continuing operations before income taxes(1)(2)		90,973		8,823		—		(3,873	)		95,923
Six months ended July 1, 2012:
Net revenues	$	632,646	$	169,050	$	143,256	$	—		$	944,952
Income (loss) from continuing operations before income taxes(1)(2)		126,247		33,606		38,827		(5,444	)		193,236
Six months ended July 3, 2011:
Net revenues	$	662,346	$	125,334	$	—	$	—		$	787,680
Income (loss) from continuing operations before income taxes(1)(2)		167,900		14,314		—		(10,867	)		171,347

(1) Pension and post retirement actuarial gains and losses, interest income, and interest expense and other are included in Corporate and Eliminations.

(2) Included in the income (loss) from continuing operations before income taxes for each of the segments are charges and credits for the three and six months ended July 1, 2012 and July 3, 2011 that include restructuring and other, net, and provision for excess and obsolete inventory, as follows:

Included in the Semiconductor Test segment are charges for the following:

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Cost of revenues—provision for excess and obsolete inventory	$	5,957	$	1,500	$	6,169	$	5,942
Restructuring and other, net		286		1,279		286		2,170
Total	$	6,243	$	2,779	$	6,455	$	8,112

Included in the Systems Test Group segment are charges and credits for the following:

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Cost of revenues—provision for excess and obsolete inventory	$	1,753	$	216	$	2,642	$	401
Restructuring and other, net		—		—		—		(246	)
Total	$	1,753	$	216	$	2,642	$	155

Included in the Wireless Test segment are charges for the following:

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Cost of revenues—inventory step-up	$	1,218	$	—	$	6,089	$	—
Cost of revenues—provision for excess and obsolete inventory		1,643		—		2,116		—
Total	$	2,861	$	—	$	8,205	$	—

Included in Corporate and Eliminations are credits for the following:

	For the Three Months Ended					For the Six Months Ended
	July 1,  2012			July 3,  2011		July 1,  2012			July 3,  2011
	(in thousands)
Restructuring and other, net	$	(6,548	)	$	—	$	(8,406	)	$	(232	)
Total	$	(6,548	)	$	—	$	(8,406	)	$	(232	)

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Net Income per Common Share

6 Months Ended

Jul. 01, 2012

Net Income per Common Share

L. Net Income per Common Share

The following table sets forth the computation of basic and diluted net income per common share:

	For the Three Months Ended					For the Six Months Ended
	July 1, 2012		July 3, 2011			July 1, 2012		July 3, 2011
	(in thousands, except per share amounts)
Income from continuing operations	$	111,387	$	88,084		$	144,951	$	158,022
Income from discontinued operations		—		—			—		1,703
(Loss) Gain on disposal of discontinued operations		—		(832	)		—		24,371
Net income for basic net income per share	$	111,387	$	87,252		$	144,951	$	184,096
Weighted average common shares-basic		186,573		185,367			186,205		185,044
Effect of dilutive potential common shares:
Incremental shares from assumed conversion of convertible notes(1)		22,301		22,711			22,651		23,036
Convertible note hedge warrant shares(2)		17,340		17,914			17,829		18,368
Restricted stock units		1,171		3,877			1,405		4,222
Stock options		2,160		469			2,247		508
Employee stock purchase rights		101		114			62		88
Dilutive potential common shares		43,073		45,085			44,194		46,222
Weighted average common shares-diluted		229,646		230,452			230,399		231,266
Net income per common share-basic
Continuing operations	$	0.60	$	0.48		$	0.78	$	0.85
Discontinued operations		—		(0.01	)		—		0.14
	$	0.60	$	0.47		$	0.78	$	0.99
Net income per common share-diluted
Continuing operations	$	0.49	$	0.38		$	0.63	$	0.68
Discontinued operations		—		—			—		0.12
	$	0.49	$	0.38		$	0.63	$	0.80

(1) Incremental shares from assumed conversion of the convertible notes for the three and six months ended July 1, 2012 and July 3, 2011 are calculated using the difference between the average Teradyne stock price for the period and the conversion price of $5.48, multiplied by the 34.7 million shares that would be issued upon conversion. The result of this calculation, representing the total intrinsic value of the convertible debt, is divided by the average Teradyne stock price for the period.

(2) Convertible note hedge warrant shares for the three and six months ended July 1, 2012 and July 3, 2011 are calculated using the difference between the average Teradyne stock price for the period and the warrant price of $7.67, multiplied by the 34.7 million shares that would be issued upon conversion. The result of this calculation, representing the total intrinsic value of the warrant, is divided by the average Teradyne stock price for the period.

The computation of diluted net income per common share for the three and six months ended July 1, 2012 excludes the effect of the potential exercise of stock options to purchase approximately 0.3 million shares, and the computation of diluted net income per common share for the three and six months ended July 1, 2012 excludes the effect of the potential exercise of restricted stock units of 0.1 million, because the effect would have been anti-dilutive.

The computation of diluted net income per common share for the three and six months ended July 3, 2011 excludes the effect of the potential exercise of stock options to purchase approximately 0.5 million and 1.0 million shares, respectively, because the effect would have been anti-dilutive.

With respect to the Teradyne’s convertible debt, Teradyne intends to settle its conversion spread (i.e., the intrinsic value of the embedded option feature contained in the convertible debt) in shares. Teradyne accounts for its conversion spread using the treasury stock method.

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Deferred Revenue and Customer Advances

6 Months Ended

Jul. 01, 2012

Deferred Revenue and Customer Advances

H. Deferred Revenue and Customer Advances

Deferred revenue and customer advances consist of the following and are included in short and long-term deferred revenue and customer advances.

	July 1, 2012		December 31, 2011
	(in thousands)
Customer advances	$	54,149	$	70,001
Maintenance, training and extended warranty		45,826		33,953
Undelivered elements		5,314		7,939
Acceptance		724		318
Total deferred revenue and customer advances	$	106,013	$	112,211

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Schedule of Deferred Revenue and Customer Advances (Detail) (USD $) In Thousands, unless otherwise specified	Jul. 01, 2012	Dec. 31, 2011
Deferred Revenue Arrangement
Customer advances	$ 54,149	$ 70,001
Maintenance, training and extended warranty	45,826	33,953
Undelivered elements	5,314	7,939
Acceptance	724	318
Total deferred revenue and customer advances	$ 106,013	$ 112,211

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Financial Instruments and Derivatives

6 Months Ended

Jul. 01, 2012

Financial Instruments and Derivatives

F. Financial Instruments and Derivatives

Financial Instruments

Teradyne uses the market and income approach to value its financial instruments and there was no change in valuation techniques used by Teradyne during the three and six months ended July 1, 2012 and July 3, 2011. As defined in ASC 820-10, “Fair Value Measurements and Disclosures”, fair value is the price that would be received from the sale of an asset or paid to transfer a liability in an orderly transaction between market participants. ASC 820-10 requires that assets and liabilities are carried at fair value and are classified in one of the following three categories:

Level 1: Quoted prices in active markets for identical assets as of the reporting date.

Level 2: Inputs other than Level 1, that are observable either directly or indirectly as of the reporting date. For example, a common approach for valuing fixed income securities is the use of matrix pricing. Matrix pricing is a mathematical technique used to value securities by relying on the securities’ relationship to other benchmark quoted prices.

Level 3: Unobservable inputs that are not supported by market data. Unobservable inputs are developed based on the best information available, which might include Teradyne’s own data.

Most of Teradyne’s fixed income securities are classified as Level 2, with the exception of U.S. Treasury securities and investments in equity and debt mutual funds, which are classified as Level 1, and contingent consideration, which is classified as Level 3. As of July 1, 2012, the majority of Level 2 securities were priced by pricing vendors. These pricing vendors utilize the most recent observable market information in pricing these securities or, if specific prices are not available, use other observable inputs like market transactions involving identical or comparable securities.

During the six months ended July 1, 2012 and July 3, 2011, there were no transfers in and out of Level 1, Level 2 and Level 3.

The following table sets forth by fair value hierarchy Teradyne’s financial assets and liabilities that were measured at fair value on a recurring basis as of July 1, 2012 and December 31, 2011.

	July 1, 2012
	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in thousands)
Assets
Cash	$	214,948	$	—	$	—	$	214,948
Cash equivalents		363,877		10,231		—		374,108
Available for sale securities:
U.S. government agency securities		—		112,315		—		112,315
Corporate debt securities		—		48,891		—		48,891
Commercial paper		—		30,990		—		30,990
U.S. Treasury securities		28,673		—		—		28,673
Certificates of deposit and time deposits		—		9,500		—		9,500
Equity and debt mutual funds		9,058		—		—		9,058
Non-U.S. government securities		270		—		—		270
Total	$	616,826	$	211,927	$	—	$	828,753
Liabilities
Contingent consideration	$	—	$	—	$	54,662	$	54,662
Derivatives		—		81		—		81
Total	$	—	$	81	$	54,662	$	54,743

Reported as follows:

	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets
Cash and cash equivalents	$	578,825	$	10,231	$	—	$	589,056
Marketable securities		5,431		100,516		—		105,947
Long-term marketable securities		32,570		101,180		—		133,750
	$	616,826	$	211,927	$	—	$	828,753
Liabilities
Contingent consideration	$	—	$	—	$	54,662	$	54,662
Other accrued liabilities		—		81		—		81
	$	—	$	81	$	54,662	$	54,743

	December 31, 2011
	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in thousands)
Assets
Cash	$	161,243	$	—	$	—	$	161,243
Cash equivalents		396,329		16,164		—		412,493
Available for sale securities:
U.S. government agency securities		—		83,197		—		83,197
Corporate debt securities		—		44,829		—		44,829
Commercial paper		—		22,075		—		22,075
U.S. Treasury securities		14,180		—		—		14,180
Equity and debt mutual funds		8,237		—		—		8,237
Certificates of deposit and time deposits		—		8,117		—		8,117
Non-U.S. government securities		274		—		—		274
Total	$	580,263	$	174,382	$	—	$	754,645
Liabilities
Contingent consideration	$	—	$	—	$	68,892	$	68,892
Derivatives		—		314		—		314
Total	$	—	$	314	$	68,892	$	69,206

Reported as follows:

	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets
Cash and cash equivalents	$	557,572	$	16,164	$	—	$	573,736
Marketable securities		9,044		87,458		—		96,502
Long-term marketable securities		13,647		70,760		—		84,407
	$	580,263	$	174,382	$	—	$	754,645
Liabilities
Contingent consideration	$	—	$	—	$	68,892	$	68,892
Other accrued liabilities		—		314		—		314
	$	—	$	314	$	68,892	$	69,206

Contingent consideration is measured at fair value and is based on significant inputs not observable in the market, which represents a Level 3 measurement within the fair value hierarchy. The valuation of contingent consideration uses assumptions and estimates to forecast a range of outcomes. Teradyne assesses these assumptions and estimates on a quarterly basis as additional data impacting the assumptions is obtained. Changes in the fair value of contingent consideration related to updated assumptions and estimates are recognized within the condensed consolidated statements of operations.

The following table provides quantitative information associated with the fair value measurement of Teradyne’s Level 3 financial instrument:

	July 1, 2012			Weighted Average
Liability	Fair Value	Valuation Technique	Unobservable Inputs
	(in thousands)
Contingent consideration	$54,662	Income approach— discounted cash flow	Revenue earn-out—probability of low case (scenario) for calendar year 2012 revenue.		70	%
			Revenue earn-out—probability of high case (scenario) for calendar year 2012 revenue.		30	%
			Discount rate for revenue earn-out		3.5	%
			Discount rate for new product earn-out		3.5	%

The significant unobservable inputs used in the fair value measurement of contingent consideration are the probabilities of successful achievement of calendar year 2012 revenues, the quarterly period in which the revenues are expected to be achieved and a discount rate. Increases or decreases in the revenue probabilities and the period in which revenues will be achieved would result in a higher or lower fair value measurement.

The following table represents changes in the fair value of Level 3 contingent consideration:

	Contingent consideration
	(in thousands)
Balance at December 31, 2011	$	68,892
Fair value adjustment		(1,858	)
Payment		(5,824	)
Balance at April 1, 2012		61,210
Fair value adjustment		(6,548	)
Balance at July 1, 2012	$	54,662

Proceeds from sales of available-for-sale marketable securities were $39.7 million and $54.3 million, respectively, for the six months ended July 1, 2012 and July 3, 2011.

During the three and six months ended July 1, 2012, Teradyne recorded a net gain of $0.3 million and $0.6 million, respectively, from sales of marketable securities. During the three and six months ended July 3, 2011, Teradyne recorded a net gain of $0.1 million and a net loss $0.1 million, respectively, from sales of marketable securities.

Realized losses from sales of marketable securities are included in interest expense and other. Realized gains from sales of marketable securities are included in interest income.

The carrying amounts and fair values of financial instruments at July 1, 2012 and December 31, 2011 were as follows:

	July 1, 2012				December 31, 2011
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(in thousands)
Cash and cash equivalents	$	589,056	$	589,056	$	573,736	$	573,736
Marketable securities		239,697		239,697		180,909		180,909
Convertible debt(1)		162,762		496,138		156,098		485,925
Japan loan		5,043		5,043		6,431		6,431

(1) The carrying value represents the bifurcated debt component only, while the fair value is based on quoted market prices for the convertible note which includes the equity conversion feature.

The fair values of cash and cash equivalents, accounts receivable, net and accounts payable approximate the carrying amount due to the short-term maturities of these instruments.

At July 1, 2012 and December 31, 2011, available-for-sale marketable securities were reported as follows:

	July 1, 2012
	Available-for-Sale									Fair Market Value of Investments with  Unrealized Losses
	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value
	(in thousands)
U.S. government agency securities	$	112,162	$	168	$	(15	)	$	112,315	$	49,867
Corporate debt securities		46,890		2,071		(70	)		48,891		18,236
Commercial paper		30,994		5		(9	)		30,990		13,234
U.S. Treasury securities		28,564		109		—			28,673		—
Certificates of deposit and time deposits		9,501		—		(1	)		9,500		5,822
Equity and debt mutual funds		8,345		726		(13	)		9,058		332
Non-U.S. government securities		270		—		—			270		—
	$	236,726	$	3,079	$	(108	)	$	239,697	$	87,491

Reported as follows:

	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value		Fair Market Value of Investments with Unrealized Losses
	(in thousands)
Marketable securities	$	105,954	$	12	$	(19	)	$	105,947	$	47,572
Long-term marketable securities		130,772		3,067		(89	)		133,750		39,919
	$	236,726	$	3,079	$	(108	)	$	239,697	$	87,491

	December 31, 2011
	Available-for-Sale									Fair Market Value of Investments with  Unrealized Losses
	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value
	(in thousands)
U.S. government agency securities	$	83,070	$	152	$	(25	)	$	83,197	$	28,510
Corporate debt securities		43,077		1,893		(141	)		44,829		17,033
Commercial paper		22,083		2		(10	)		22,075		9,479
U.S. Treasury securities		14,141		39		—			14,180		—
Equity and debt mutual funds		7,876		477		(116	)		8,237		3,749
Certificates of deposit and time deposits		8,122		—		(5	)		8,117		5,800
Non-U.S. government securities		256		18		—			274		—
	$	178,625	$	2,581	$	(297	)	$	180,909	$	64,571

Reported as follows:

	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value		Fair Market Value of Investments with Unrealized Losses
	(in thousands)
Marketable securities	$	96,518	$	24	$	(40	)	$	96,502	$	35,595
Long-term marketable securities		82,107		2,557		(257	)		84,407		28,976
	$	178,625	$	2,581	$	(297	)	$	180,909	$	64,571

As of July 1, 2012, the fair market value of marketable securities with unrealized losses totaled $87.5 million. Of this value, $7.1 million had unrealized losses greater than one year and $80.4 million had unrealized losses less than one year. As of December 31, 2011, the fair market value of marketable securities with unrealized losses totaled $64.6 million. Of this value, $2.4 million had unrealized losses greater than one year and $62.2 million had unrealized losses less than one year.

The contractual maturities of available-for-sale marketable securities as of July 1, 2012 were as follows:

	July 1, 2012
	Cost		Fair Market Value
Due within one year	$	107,961	$	107,954
Due after 1 year through 5 years		110,388		111,299
Due after 5 years through 10 years		2,662		2,836
Due after 10 years		15,715		17,608
Total	$	236,726	$	239,697

Derivatives

Teradyne conducts business in a number of foreign countries, with certain transactions denominated in local currencies. The purpose of Teradyne’s foreign currency management is to minimize the effect of exchange rate fluctuations on certain foreign currency denominated net monetary assets. Teradyne does not use derivative financial instruments for trading or speculative purposes.

To minimize the effect of exchange rate fluctuations associated with the remeasurement of monetary assets and liabilities denominated in foreign currencies, Teradyne enters into foreign currency forward contracts. The change in fair value of these derivatives is recorded directly in earnings, and is used to offset the change in fair value of the monetary assets and liabilities denominated in foreign currencies.

The notional amount of foreign exchange contracts hedging monetary assets and liabilities denominated in foreign currencies was $74.4 million and $85.4 million at July 1, 2012 and December 31, 2011, respectively.

The following table summarizes the fair value of derivative instruments at July 1, 2012 and December 31, 2011.

	Balance Sheet Location		July 1, 2012		December 31, 2011
			(in thousands)
Derivatives not designated as hedging instruments:
Foreign exchange contracts		Other accrued liabilities	$	81	$	314
			$	81	$	314

The following table summarizes the effect of derivative instruments in the statement of operations recognized during the three and six months ended July 1, 2012 and July 3, 2011. The table does not reflect the corresponding gains (losses) from the remeasurement of the monetary assets and liabilities denominated in foreign currencies.

	Location of Gains (Losses) Recognized in Statement of Operations		For the Three Months Ended						For the Six Months Ended
			July 1, 2012			July 3, 2011			July 1, 2012		July 3, 2011
			(in thousands)
Derivatives not designated as hedging instruments:
Foreign exchange contracts		Interest expense and other	$	(2,360	)	$	(166	)	$	520	$	661
			$	(2,360	)	$	(166	)	$	520	$	661

See Note G “Debt” regarding derivatives related to convertible senior notes.

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Debt

6 Months Ended

Jul. 01, 2012

Debt

G. Debt

Loan Agreement

On March 31, 2009, Teradyne K.K., Teradyne’s wholly-owned subsidiary in Japan, entered into a loan agreement with a local bank in Japan to borrow approximately $10.0 million. The loan has a term of 5 years and a fixed interest rate of 0.81%. Approximately $6.0 million of the loan is collateralized by a real estate mortgage on Teradyne K.K.’s building and land in Kumamoto, Japan and approximately $4.0 million is unsecured. Teradyne, Inc. has guaranteed payment of the loan obligation. The loan is amortized over the term of the loan with semiannual principal payments of approximately $1.0 million payable on September 30 and March 30 each year. At July 1, 2012, approximately $2.5 million of the outstanding loan principal is included in current debt and approximately $2.5 million is classified as long-term debt.

Convertible Senior Notes

In April 2009, Teradyne issued 4.50% convertible senior notes (the “Notes”) at an aggregate principal amount of $190 million. The Notes will mature on March 15, 2014, unless earlier repurchased by Teradyne or converted. The Notes are senior unsecured obligations and rank equally with all of Teradyne’s existing and future senior debt and senior to any of Teradyne’s subordinated debt.

The Notes may be converted, under certain circumstances and during certain periods, at an initial conversion rate of approximately 182.65 shares of Teradyne’s common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $5.48, a 25% conversion premium based on the last reported sale price of $4.38 per share of Teradyne’s common stock on March 31, 2009. The conversion rate is subject to adjustment in certain circumstances including but not limited to Teradyne issuing a cash or stock dividend or effecting a stock split.

During the three months ended July 1, 2012, the following circumstance that allows holders to convert their Notes at their option prior to December 15, 2013 occurred: the last reported sale price of Teradyne’s common stock for 20 or more trading days in a period of 30 consecutive trading days ending on the last trading day of the immediately preceding calendar quarter exceeded 130% of the conversion price in effect on the last trading day of the immediately preceding calendar quarter. As of August 10, 2012, no holders have exercised their option to convert their Notes.

Concurrently with the offering of the Notes, Teradyne entered into a convertible note hedge transaction with a strike price equal to the initial conversion price of the Notes, or approximately $5.48. The convertible note hedge allows Teradyne to receive shares of its common stock and/or cash related to the excess conversion value that it would pay to the holders of the Notes upon conversion. The convertible note hedges will cover, subject to customary antidilution adjustments, approximately 34,703,196 shares of Teradyne’s common stock. Teradyne paid approximately $64.6 million for the convertible note hedges.

On March 31, 2009, Teradyne entered into a warrant transaction with a strike price of approximately $7.67 per share, which was 75% higher than the closing price of Teradyne’s common stock. Teradyne received approximately $43.0 million for the warrants.

The convertible note hedge and warrant transaction will generally have the effect of increasing the conversion price of the Notes to approximately $7.67 per share of Teradyne’s common stock, representing a 75% conversion premium based upon the closing price of Teradyne’s common stock on March 31, 2009.

The Notes are classified as long-term debt in the balance sheet at July 1, 2012 and December 31, 2011. The tables below represent the components of Teradyne’s convertible senior notes:

	July 1, 2012		December 31, 2011
	(in thousands)
Debt principal	$	190,000	$	190,000
Unamortized debt discount		27,238		33,902
Net carrying amount of the convertible debt	$	162,762	$	156,098

	For the Three Months Ended				For the Six Months Ended
	July 1,  2012		July 3,  2011		July 1,  2012		July 3,  2011
	(in thousands)
Contractual interest expense	$	2,138	$	2,138	$	4,299	$	4,347
Amortization of the discount component and debt issue fees		3,592		3,160		7,071		6,221
Total interest expense on the convertible debt	$	5,730	$	5,298	$	11,370	$	10,568

As of July 1, 2012, the unamortized discount was $27.2 million, which will be amortized over approximately 1.75 years, and the carrying amount of the equity component was $63.4 million. As of July 1, 2012, the conversion rate was equal to the initial conversion price of approximately $5.48 per share and the if-converted value of the Notes was $487.9 million.

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Product Warranty

6 Months Ended

Jul. 01, 2012

Product Warranty

I. Product Warranty

Teradyne generally provides a one-year warranty on its products commencing upon installation or shipment. A provision is recorded upon revenue recognition to cost of revenues for estimated warranty expense based on historical experience. Related costs are charged to the warranty accrual as incurred. The balance below is included in other accrued liabilities.

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
	(in thousands)
Balance at beginning of period	$	8,722		$	9,502		$	8,154		$	9,886
Accruals for warranties issued during the period		5,649			3,976			9,425			7,553
Adjustments related to pre-existing warranties		403			(1,116	)		143			(2,072	)
Settlements made during the period		(3,727	)		(3,100	)		(6,675	)		(6,105	)
Balance at end of period	$	11,047		$	9,262		$	11,047		$	9,262

When Teradyne receives revenue for extended warranties beyond one year, it is deferred and recognized on a straight-line basis over the contract period. Related costs are expensed as incurred. The balance below is included in deferred revenue and customer advances and long-term other accrued liabilities.

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
	(in thousands)
Balance at beginning of period	$	12,927		$	9,870		$	12,742		$	8,972
Deferral of new extended warranty revenue		9,935			1,861			12,282			3,798
Recognition of extended warranty deferred revenue		(2,108	)		(1,423	)		(4,270	)		(2,462	)
Balance at end of period	$	20,754		$	10,308		$	20,754		$	10,308

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Schedule of Estimated Fair Value of Stock Options Assumptions (Detail)	6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award
Expected life (years)	3 years 6 months	4 years
Interest rate	0.40%	1.50%
Volatility-historical	56.00%	52.10%
Dividend yield	0.00%	0.00%
Stock Purchase Rights
Share-based Compensation Arrangement by Share-based Payment Award
Expected life (years)	6 months	6 months
Interest rate	0.06%	0.19%
Volatility-historical	52.60%	41.50%
Dividend yield	0.00%	0.00%

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Intangible Assets - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
Finite-Lived Intangible Assets
Aggregate intangible asset amortization expense	$ 18,429	$ 7,291	$ 36,858	$ 14,582

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Stock Based Compensation - Additional Information (Detail) (USD $) In Millions, except Per Share data, unless otherwise specified	6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011
Share-based Compensation Arrangement by Share-based Payment Award
Restricted stock unit awards to employees	1.6	1.7
Weighted average grant date fair value of restricted stock units granted	$ 16.83	$ 16.20
Number of service-based stock options granted to executive officers	0.2	0.1
Weighted average grant date fair value of stock options granted to executive officers	$ 6.85	$ 6.74
Maximum
Share-based Compensation Arrangement by Share-based Payment Award
Period of stock granted to employees and executive officers vest in equal installments	7 years
Restricted Stock Units
Share-based Compensation Arrangement by Share-based Payment Award
Period of stock granted to employees and executive officers vest in equal installments	4 years
Stock Options
Share-based Compensation Arrangement by Share-based Payment Award
Period of stock granted to employees and executive officers vest in equal installments	4 years
Stock Purchase Rights
Share-based Compensation Arrangement by Share-based Payment Award
Weighted average grant date fair value of stock options granted to executive officers	$ 4.09	$ 3.66

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Net Income per Common Share (Tables)

6 Months Ended

Jul. 01, 2012

Schedule Of Computation Of Basic And Diluted Net Income Per Common Share

The following table sets forth the computation of basic and diluted net income per common share:

	For the Three Months Ended					For the Six Months Ended
	July 1, 2012		July 3, 2011			July 1, 2012		July 3, 2011
	(in thousands, except per share amounts)
Income from continuing operations	$	111,387	$	88,084		$	144,951	$	158,022
Income from discontinued operations		—		—			—		1,703
(Loss) Gain on disposal of discontinued operations		—		(832	)		—		24,371
Net income for basic net income per share	$	111,387	$	87,252		$	144,951	$	184,096
Weighted average common shares-basic		186,573		185,367			186,205		185,044
Effect of dilutive potential common shares:
Incremental shares from assumed conversion of convertible notes(1)		22,301		22,711			22,651		23,036
Convertible note hedge warrant shares(2)		17,340		17,914			17,829		18,368
Restricted stock units		1,171		3,877			1,405		4,222
Stock options		2,160		469			2,247		508
Employee stock purchase rights		101		114			62		88
Dilutive potential common shares		43,073		45,085			44,194		46,222
Weighted average common shares-diluted		229,646		230,452			230,399		231,266
Net income per common share-basic
Continuing operations	$	0.60	$	0.48		$	0.78	$	0.85
Discontinued operations		—		(0.01	)		—		0.14
	$	0.60	$	0.47		$	0.78	$	0.99
Net income per common share-diluted
Continuing operations	$	0.49	$	0.38		$	0.63	$	0.68
Discontinued operations		—		—			—		0.12
	$	0.49	$	0.38		$	0.63	$	0.80

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Financial Instruments and Derivatives - Additional Information (Detail) (USD $)	3 Months Ended		6 Months Ended		12 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011	Dec. 31, 2011
Fair Value, Balance Sheet Grouping, Financial Statement Captions
Proceeds from sales of available-for-sale marketable securities			$ 39,715,000	$ 54,335,000
Net gain (loss) from sales of marketable securities	300,000	100,000	600,000	(100,000)
Fair market value of investments with unrealized losses	87,491,000		87,491,000		64,571,000
Fair market value of investments with unrealized losses greater than one year	7,100,000				2,400,000
Fair market value of investments with unrealized losses less than one year	80,400,000				62,200,000
Notional amount of foreign exchange contracts hedging monetary assets and liabilities	$ 74,400,000		$ 74,400,000		$ 85,400,000

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Retirement Plans

6 Months Ended

Jul. 01, 2012

Retirement Plans

N. Retirement Plans

Defined Benefit Pension Plans

Teradyne has defined benefit pension plans covering a portion of domestic employees and employees of certain non-U.S. subsidiaries. Benefits under these plans are based on employees’ years of service and compensation. Teradyne’s funding policy is to make contributions to these plans in accordance with local laws and to the extent that such contributions are tax deductible. The assets of these plans consist primarily of fixed income and equity securities. In addition, Teradyne has an unfunded supplemental executive defined benefit plan in the United States to provide retirement benefits in excess of levels allowed by the Employment Retirement Income Security Act (“ERISA”) and the Internal Revenue Code (“IRC”), as well as unfunded foreign plans.

Components of net periodic pension cost for all plans were as follows:

	For the Three Months Ended						For the Six Months Ended
	July 1,  2012			July 3,  2011			July 1,  2012			July 3,  2011
	(in thousands)
Service cost	$	643		$	668		$	1,357		$	1,436
Interest cost		4,125			4,457			8,185			8,784
Expected return on plan assets		(4,082	)		(3,906	)		(8,164	)		(7,818	)
Amortization of unrecognized prior service cost		58			155			116			310
Settlement		—			680			—			680
Actuarial loss		3,146			4,279			3,146			4,279
Total net periodic pension cost	$	3,890		$	6,333		$	4,640		$	7,671

In the six months ended July 1, 2012, Teradyne contributed $1.8 million to its defined benefit pension plans.

Post-Retirement Benefit Plans

In addition to receiving pension benefits, U.S. Teradyne employees who meet early retirement eligibility requirements as of their termination dates may participate in Teradyne’s Welfare Plan, which includes death, and medical and dental benefits up to age 65. Death benefits provide a fixed sum to retirees’ survivors and are available to all retirees. Substantially all of Teradyne’s current U.S. employees could become eligible for these benefits, and the existing benefit obligation relates primarily to those employees.

Components of net periodic post-retirement cost were as follows:

	For the Three Months Ended						For the Six Months Ended
	July 1, 2012			July 3, 2011			July 1, 2012			July 3, 2011
	(in thousands)
Service cost	$	15		$	14		$	34		$	30
Interest cost		108			134			219			270
Amortization of unrecognized prior service benefit		(150	)		(150	)		(299	)		(299	)
Actuarial gain		(92	)		(76	)		(92	)		(76	)
Total net periodic post-retirement cost	$	(119	)	$	(78	)	$	(138	)	$	(75	)

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Change in Accounting Principle (Tables)

6 Months Ended

Jul. 01, 2012

Schedule Of Condensed Consolidated Balance Sheets

Condensed Consolidated Balance Sheets

	December 31, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Assets:
Total assets	$	2,188,639		$	—		$	2,188,639
Liabilities:
Total liabilities		683,579			—			683,579
Shareholders’ Equity:
Common stock		22,948			—			22,948
Additional paid-in capital		1,293,130			—			1,293,130
Accumulated other comprehensive (loss) income		(129,875	)		134,621			4,746
Retained earnings		318,857			(134,621	)		184,236
Total shareholders’ equity		1,505,060			—			1,505,060
Total liabilities and shareholders’ equity	$	2,188,639		$	—		$	2,188,639

Schedule Of Condensed Consolidated Statements Of Operations

Condensed Consolidated Statements of Operations

	For the Three Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands, except per share amounts)
Net revenues	$	410,519		$	—		$	410,519
Cost of revenues		195,433			408			195,841
Gross profit		215,086			(408	)		214,678
Operating expenses:
Engineering and development		47,393			999			48,392
Selling and administrative		57,481			399			57,880
Acquired intangible asset amortization		7,291			—			7,291
Restructuring and other		1,279			—			1,279
Total operating expenses		113,444			1,398			114,842
Income from operations		101,642			(1,806	)		99,836
Interest income		1,403			—			1,403
Interest expense and other, net		(5,316	)		—			(5,316	)
Income from continuing operations before income taxes		97,729			(1,806	)		95,923
Provision for income taxes		7,839			—			7,839
Income from continuing operations		89,890			(1,806	)		88,084
Loss on disposal of discontinued operations		(832	)		—			(832	)
Net income	$	89,058		$	(1,806	)	$	87,252
Net income per common share from continuing operations:
Basic	$	0.48		$	—		$	0.48
Diluted	$	0.39		$	(0.01	)	$	0.38
Net income per common share:
Basic	$	0.48		$	(0.01	)	$	0.47
Diluted	$	0.39		$	(0.01	)	$	0.38
Weighted average common share—basic		185,367						185,367
Weighted average common share—diluted		230,452						230,452

	For the Six Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands, except per share amounts)
Net revenues	$	787,680		$	—		$	787,680
Cost of revenues		380,185			(75	)		380,110
Gross profit		407,495			75			407,570
Operating expenses:
Engineering and development		95,370			166			95,536
Selling and administrative		115,710			(99	)		115,611
Acquired intangible asset amortization		14,582			—			14,582
Restructuring and other		1,692			—			1,692
Total operating expenses		227,354			67			227,421
Income from operations		180,141			8			180,149
Interest income		2,690			—			2,690
Interest expense and other, net		(11,492	)		—			(11,492	)
Income from continuing operations before income taxes		171,339			8			171,347
Provision for income taxes		13,325			—			13,325
Income from continuing operations		158,014			8			158,022
Income from discontinued operations before income taxes		1,278			158			1,436
Benefit from income taxes		(267	)		—			(267	)
Income from discontinued operations		1,545			158			1,703
Gain on disposal of discontinued operations (net of tax of $4,578)		24,371			—			24,371
Net income	$	183,930		$	166		$	184,096
Net income per common share from continuing operations:
Basic	$	0.85		$	—		$	0.85
Diluted	$	0.68		$	—		$	0.68
Net income per common share:
Basic	$	0.99		$	—		$	0.99
Diluted	$	0.80		$	—		$	0.80
Weighted average common share—basic		185,044						185,044
Weighted average common share—diluted		231,266						231,266

Schedule Of Condensed Consolidated Statements Of Comprehensive Income

Condensed Consolidated Statements of Comprehensive Income

	For the Three Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Net income	$	89,058		$	(1,806	)	$	87,252
Other comprehensive income, net of tax:
Unrealized gains on marketable securities		1,295			—			1,295
Defined benefit pension and post-retirement plans:
Actuarial losses arising during period, net of tax of ($10), $10		(4,150	)		4,150			—
Settlement gain, net of tax of $38, ($38)		217			(217	)		—
Less: Amortization included in net periodic pension and post-retirement costs:
Actuarial losses, net of tax of $8, ($8)		2,377			(2,377	)		—
Prior service costs, net of tax of $0		5			—			5
		2,382			(2,377	)		5
Other comprehensive income		(256	)		1,556			1,300
Comprehensive income	$	88,802		$	(250	)	$	88,552

	For the Six Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Net income	$	183,930		$	166		$	184,096
Other comprehensive income, net of tax:
Foreign currency translation reclassification adjustment included in net income		2,266			—			2,266
Unrealized gains on marketable securities		1,310			—			1,310
Defined benefit pension and post-retirement plans:
Actuarial losses arising during period, net of tax of ($5), $5		(4,201	)		4,201			—
Settlement gain, net of tax of $73, ($73)		277			(277	)		—
Less: Amortization included in net periodic pension and post-retirement costs:
Actuarial losses, net of tax of $20, ($20)		4,455			(4,455	)		—
Prior service costs, net of tax of $0		11			—			11
		4,466			(4,455	)		11
Other comprehensive income		4,118			(531	)		3,587
Comprehensive income	$	188,048		$	(365	)	$	187,683

Schedule Of Condensed Consolidated Statements Of Cash Flows

Condensed Consolidated Statements of Cash Flows

	For the Six Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Cash flows from operating activities:
Net income	$	183,930		$	166		$	184,096
Less: Income from discontinued operations		1,545			158			1,703
Less: Gain on disposal of discontinued operations		24,371			—			24,371
Income from continuing operations		158,014			8			158,022
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
Depreciation		25,645			—			25,645
Amortization		25,289			(4,473	)		20,816
Stock-based compensation		14,682			—			14,682
Provision for excess and obsolete inventory		6,343			—			6,343
Tax benefit related to stock options and restricted stock units		(3,717	)		—			(3,717	)
Other		1,422			4,465			5,887
Changes in operating assets and liabilities, net of businesses sold:
Accounts receivable		(39,067	)		—			(39,067	)
Inventories		(15,006	)		—			(15,006	)
Other assets		(10,344	)		—			(10,344	)
Deferred revenue and customer advances		(28,339	)		—			(28,339	)
Accounts payable and other accrued expenses		(9,275	)		—			(9,275	)
Retirement plan contributions		(5,245	)		—			(5,245	)
Accrued income taxes		5,406			—			5,406
Net cash provided by continuing operations		125,808			—			125,808
Net cash used for discontinued operations		(4,225	)		—			(4,225	)
Net cash provided by operating activities		121,583			—			121,583
Net cash used for investing activities		(83,469	)		—			(83,469	)
Net cash provided by financing activities		19,547			—			19,547
Increase in cash and cash equivalents		57,661			—			57,661
Cash and cash equivalents at beginning of period		397,737			—			397,737
Cash and cash equivalents at end of period	$	455,398		$	—		$	455,398

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Schedule of Quantitative Information Associated with Fair Value Measurement of Level 3 (Detail) (USD $) In Thousands, unless otherwise specified			6 Months Ended
	Jul. 01, 2012	Dec. 31, 2011	Jul. 01, 2012 Discount Rate For Revenue Earn-Out	Jul. 01, 2012 Discount Rate For Cellular Earn-Out	Jul. 01, 2012 Minimum Revenue Earn-Out-Probability Of Low Case Scenario For Calendar Year 2012 Revenue	Jul. 01, 2012 Maximum Revenue Earn-Out-Probability Of High Case Scenario For Calendar Year 2012 Revenue
Fair Value Inputs, Assets, Quantitative Information
Contingent consideration, fair value	$ 54,662	$ 68,892
Revenue earn-out scenario probability percentage					70.00%	30.00%
Earn-out discount rate			3.50%	3.50%

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Schedule of Condensed Consolidated Statements of Operations (Parenthetical) (Detail) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
Change In Accounting Principle
Gain on disposal of discontinued operations, tax	$ 0	$ 0	$ 0	$ 4,578
Originally Reported
Change In Accounting Principle
Gain on disposal of discontinued operations, tax				4,578
As Adjusted
Change In Accounting Principle
Gain on disposal of discontinued operations, tax				$ 4,578

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
(Loss) Gain on disposal of discontinued operations, tax	$ 0	$ 0	$ 0	$ 4,578

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Change in Accounting Principle

6 Months Ended

Jul. 01, 2012

Change in Accounting Principle

C. Change in Accounting Principle

Effective January 1, 2012, Teradyne changed the method of recognizing actuarial gains and losses for its defined benefit pension plans and postretirement benefit plan and calculating the expected return on plan assets for its defined benefit pension plans. Historically, Teradyne recognized net actuarial gains and losses in accumulated other comprehensive income within shareholders’ equity on the consolidated balance sheets on an annual basis and amortized them into operating results over the average remaining years of service of the plan participants, to the extent such gains and losses were outside of a range (“corridor”). Teradyne has elected to immediately recognize net actuarial gains and losses and the change in the fair value of the plan assets in its operating results in the year in which they occur or upon any interim remeasurement of the plans. In addition, Teradyne used to calculate the expected return on plan assets using a calculated market-related value of plan assets. Teradyne has also elected to calculate the expected return on plan assets using the fair value of the plan assets.

Teradyne believes that this new method is preferable as it eliminates the delay in recognizing gains and losses in its operating results and it will improve the transparency by faster recognition of the effects of economic and interest rate trends on plan obligations and investments. These actuarial gains and losses are generally measured annually as of December 31 and, accordingly, will be recorded during the fourth quarter of each year or upon any interim remeasurement of the plans. In accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 250, Accounting Changes and Error Corrections, all prior periods presented in this Quarterly Report on Form 10-Q have been adjusted to apply the new accounting method retrospectively. This accounting change did not impact the financial position of the reportable segments.

Had these changes not been made, net income for the three months and six months ended July 1, 2012 would have been $110.4 million and $140.3 million, respectively, compared to the $111.4 million and $145.0 million actually recorded. Diluted earnings per share would have been $0.48 and $0.61 compared to $0.49 and $0.63 for the three months and six months ended July 1, 2012, respectively.

The effects of the change in accounting principle on the condensed consolidated financial statements for 2011 are presented below. We have condensed the comparative financial statements for financial statement line items that were not affected by the change in accounting principle.

Condensed Consolidated Balance Sheets

	December 31, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Assets:
Total assets	$	2,188,639		$	—		$	2,188,639
Liabilities:
Total liabilities		683,579			—			683,579
Shareholders’ Equity:
Common stock		22,948			—			22,948
Additional paid-in capital		1,293,130			—			1,293,130
Accumulated other comprehensive (loss) income		(129,875	)		134,621			4,746
Retained earnings		318,857			(134,621	)		184,236
Total shareholders’ equity		1,505,060			—			1,505,060
Total liabilities and shareholders’ equity	$	2,188,639		$	—		$	2,188,639

Condensed Consolidated Statements of Operations

	For the Three Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands, except per share amounts)
Net revenues	$	410,519		$	—		$	410,519
Cost of revenues		195,433			408			195,841
Gross profit		215,086			(408	)		214,678
Operating expenses:
Engineering and development		47,393			999			48,392
Selling and administrative		57,481			399			57,880
Acquired intangible asset amortization		7,291			—			7,291
Restructuring and other		1,279			—			1,279
Total operating expenses		113,444			1,398			114,842
Income from operations		101,642			(1,806	)		99,836
Interest income		1,403			—			1,403
Interest expense and other, net		(5,316	)		—			(5,316	)
Income from continuing operations before income taxes		97,729			(1,806	)		95,923
Provision for income taxes		7,839			—			7,839
Income from continuing operations		89,890			(1,806	)		88,084
Loss on disposal of discontinued operations		(832	)		—			(832	)
Net income	$	89,058		$	(1,806	)	$	87,252
Net income per common share from continuing operations:
Basic	$	0.48		$	—		$	0.48
Diluted	$	0.39		$	(0.01	)	$	0.38
Net income per common share:
Basic	$	0.48		$	(0.01	)	$	0.47
Diluted	$	0.39		$	(0.01	)	$	0.38
Weighted average common share—basic		185,367						185,367
Weighted average common share—diluted		230,452						230,452

	For the Six Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands, except per share amounts)
Net revenues	$	787,680		$	—		$	787,680
Cost of revenues		380,185			(75	)		380,110
Gross profit		407,495			75			407,570
Operating expenses:
Engineering and development		95,370			166			95,536
Selling and administrative		115,710			(99	)		115,611
Acquired intangible asset amortization		14,582			—			14,582
Restructuring and other		1,692			—			1,692
Total operating expenses		227,354			67			227,421
Income from operations		180,141			8			180,149
Interest income		2,690			—			2,690
Interest expense and other, net		(11,492	)		—			(11,492	)
Income from continuing operations before income taxes		171,339			8			171,347
Provision for income taxes		13,325			—			13,325
Income from continuing operations		158,014			8			158,022
Income from discontinued operations before income taxes		1,278			158			1,436
Benefit from income taxes		(267	)		—			(267	)
Income from discontinued operations		1,545			158			1,703
Gain on disposal of discontinued operations (net of tax of $4,578)		24,371			—			24,371
Net income	$	183,930		$	166		$	184,096
Net income per common share from continuing operations:
Basic	$	0.85		$	—		$	0.85
Diluted	$	0.68		$	—		$	0.68
Net income per common share:
Basic	$	0.99		$	—		$	0.99
Diluted	$	0.80		$	—		$	0.80
Weighted average common share—basic		185,044						185,044
Weighted average common share—diluted		231,266						231,266

Condensed Consolidated Statements of Comprehensive Income

	For the Three Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Net income	$	89,058		$	(1,806	)	$	87,252
Other comprehensive income, net of tax:
Unrealized gains on marketable securities		1,295			—			1,295
Defined benefit pension and post-retirement plans:
Actuarial losses arising during period, net of tax of ($10), $10		(4,150	)		4,150			—
Settlement gain, net of tax of $38, ($38)		217			(217	)		—
Less: Amortization included in net periodic pension and post-retirement costs:
Actuarial losses, net of tax of $8, ($8)		2,377			(2,377	)		—
Prior service costs, net of tax of $0		5			—			5
		2,382			(2,377	)		5
Other comprehensive income		(256	)		1,556			1,300
Comprehensive income	$	88,802		$	(250	)	$	88,552

	For the Six Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Net income	$	183,930		$	166		$	184,096
Other comprehensive income, net of tax:
Foreign currency translation reclassification adjustment included in net income		2,266			—			2,266
Unrealized gains on marketable securities		1,310			—			1,310
Defined benefit pension and post-retirement plans:
Actuarial losses arising during period, net of tax of ($5), $5		(4,201	)		4,201			—
Settlement gain, net of tax of $73, ($73)		277			(277	)		—
Less: Amortization included in net periodic pension and post-retirement costs:
Actuarial losses, net of tax of $20, ($20)		4,455			(4,455	)		—
Prior service costs, net of tax of $0		11			—			11
		4,466			(4,455	)		11
Other comprehensive income		4,118			(531	)		3,587
Comprehensive income	$	188,048		$	(365	)	$	187,683

Condensed Consolidated Statements of Cash Flows

	For the Six Months Ended July 3, 2011
	Originally Reported			Effect of Accounting Change			As Adjusted
	(in thousands)
Cash flows from operating activities:
Net income	$	183,930		$	166		$	184,096
Less: Income from discontinued operations		1,545			158			1,703
Less: Gain on disposal of discontinued operations		24,371			—			24,371
Income from continuing operations		158,014			8			158,022
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
Depreciation		25,645			—			25,645
Amortization		25,289			(4,473	)		20,816
Stock-based compensation		14,682			—			14,682
Provision for excess and obsolete inventory		6,343			—			6,343
Tax benefit related to stock options and restricted stock units		(3,717	)		—			(3,717	)
Other		1,422			4,465			5,887
Changes in operating assets and liabilities, net of businesses sold:
Accounts receivable		(39,067	)		—			(39,067	)
Inventories		(15,006	)		—			(15,006	)
Other assets		(10,344	)		—			(10,344	)
Deferred revenue and customer advances		(28,339	)		—			(28,339	)
Accounts payable and other accrued expenses		(9,275	)		—			(9,275	)
Retirement plan contributions		(5,245	)		—			(5,245	)
Accrued income taxes		5,406			—			5,406
Net cash provided by continuing operations		125,808			—			125,808
Net cash used for discontinued operations		(4,225	)		—			(4,225	)
Net cash provided by operating activities		121,583			—			121,583
Net cash used for investing activities		(83,469	)		—			(83,469	)
Net cash provided by financing activities		19,547			—			19,547
Increase in cash and cash equivalents		57,661			—			57,661
Cash and cash equivalents at beginning of period		397,737			—			397,737
Cash and cash equivalents at end of period	$	455,398		$	—		$	455,398

XML

Debt - Additional Information (Detail) (USD $)	1 Months Ended	3 Months Ended	6 Months Ended		1 Months Ended		6 Months Ended
	Mar. 31, 2009 Year	Jul. 01, 2012 Day	Jul. 01, 2012	Dec. 31, 2011	Apr. 30, 2009 4.50% Convertible Senior Notes	Mar. 31, 2009 4.50% Convertible Senior Notes	Jul. 01, 2012 4.50% Convertible Senior Notes	Jul. 03, 2011 Convertible Notes Hedge Warrant	Jul. 01, 2012 Convertible Notes Hedge Warrant	Mar. 31, 2009 Convertible Notes Hedge Warrant	Jul. 01, 2012 Convertible Senior Notes	Jul. 01, 2012 Current Debt	Jul. 01, 2012 Long-term Debt
Debt Instrument
Borrowings from local bank	$ 10,000,000
Term of loan, years	5
Debt instrument, interest rate, stated percentage	0.81%				4.50%
Loan collateralized by real estate mortgage	6,000,000
Unsecured loan	4,000,000
Semiannual principal payments of loan			1,000,000
Outstanding loan principal amount												2,500,000	2,500,000
Aggregate principal amount		190,000,000	190,000,000	190,000,000	190,000,000
Senior notes maturity date					March 15, 2014
Initial conversion rate in number of shares							182.65
Additional aggregate principal amount							1,000
Initial debt conversion price		$ 5.48	$ 5.48			$ 5.48			$ 7.67	$ 7.67
Debt conversion premium percentage						25.00%
Last reported sale price per share of debt						$ 4.38
Initial conversion rate			The Notes may be converted, under certain circumstances and during certain periods, at an initial conversion rate of approximately 182.65 shares of Teradyne’s common stock per $1,000 principal amount of Notes, which is equivalent to an initial conversion price of approximately $5.48, a 25% conversion premium based on the last reported sale price of $4.38 per share of Teradyne’s common stock on March 31, 2009.
Conversion of common stock for trading days, number of days		20
Consecutive trading days		30
Percent of increase in conversion price		130.00%
Antidilution adjustments, shares			34,703,196					34,700,000
Convertible note hedges			64,600,000
Strike price per share of warrant	$ 7.67
Percentage of warrant price in excess of closing price of common stock	75.00%
Proceeds from warrants	43,000,000
Warrants conversion premium percentage	75.00%
Unamortized discount		27,238,000	27,238,000	33,902,000							27,200,000
Amortization period of unamortized discount, years			1 year 9 months
Carrying amount of equity component		63,400,000	63,400,000
If-converted value of notes			$ 487,900,000

XML

Net Income Per Common Share (Parenthetical) (Detail) (USD $)	6 Months Ended			6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011 Convertible Notes	Jul. 01, 2012 Convertible Notes	Jul. 03, 2011 Convertible Notes Hedge Warrant	Jul. 01, 2012 Convertible Notes Hedge Warrant	Mar. 31, 2009 Convertible Notes Hedge Warrant
Net Income Loss Per Common Share
Initial debt conversion price	$ 5.48		$ 5.48		$ 7.67	$ 7.67
Shares that would be issued upon conversion	34,703,196	34,700,000		34,700,000

XML

Discontinued Operations (Tables)

6 Months Ended

Jul. 01, 2012

Schedule Of Net Revenues And Income From Discontinued Operations

Net revenues and income from discontinued operations for the three and six months ended July 3, 2011 were as follows:

	For the Three  Months Ended July 3, 2011			For the Six  Months Ended July 3, 2011
	(in thousands)
Net revenues	$	—		$	9,086
Income from discontinued operations before income taxes	$	—		$	1,436
(Loss) Gain from disposal of discontinued operations before income taxes		(832	)		28,949
Income tax provision		—			4,311
(Loss) Income from discontinued operations	$	(832	)	$	26,074

XML

Retirement Plans - Additional Information (Detail) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jul. 01, 2012
Defined Benefit Plan Disclosure
Contribution to foreign pension plans	$ 1.8

XML

Change in Accounting Principle - Additional Information (Detail) (USD $)	3 Months Ended		6 Months Ended
	Jul. 01, 2012	Jul. 03, 2011	Jul. 01, 2012	Jul. 03, 2011
Change In Accounting Principle
Net income before accounting changes	$ 110,400,000		$ 140,300,000
Net income	$ 111,387,000	$ 87,252,000	$ 144,951,000	$ 184,096,000
Earnings per share diluted before accounting charges	$ 0.48		$ 0.61
Diluted	$ 0.49	$ 0.38	$ 0.63	$ 0.80

XML

Restructuring and Other, Net

6 Months Ended

Jul. 01, 2012

Restructuring and Other, Net

M. Restructuring and Other, Net

Other

During the three and six months ended July 1, 2012, due to a decrease in specified new product revenue through the December 31, 2012 earn-out period end date, Teradyne recorded a $6.5 million and $8.4 million, respectively, fair value adjustment to decrease the LitePoint acquisition contingent consideration. As of July 1, 2012, the estimated undiscounted range of outcomes for the contingent consideration is $56.0 million to $58.0 million. The decrease in the range from December 31, 2011 is due to the $5.8 million contingent consideration payment during the six months ended July 1, 2012 and the $8.4 million fair value decrease.

During the six months ended July 3, 2011, Teradyne recorded a $0.7 million charge related to a non-U.S. pension settlement.

Restructuring

In response to a downturn in the industry in 2008 and 2009, Teradyne initiated restructuring activities across all segments to reduce costs, principally through headcount reductions and facility consolidations. The remaining accrual for lease payments on vacated facilities of $1.5 million is reflected in the other accrued liabilities account and the long-term other accrued liabilities account and is expected to be paid over the lease terms, the latest of which expires in 2013. Teradyne expects to pay approximately $0.9 million against the lease accruals over the next twelve months. Teradyne’s future lease commitments are net of expected sublease income of $0.3 million as of July 1, 2012. The table below represents activity related to these actions.

	Severance and Benefits			Facility Exit Costs			Total
	(in thousands)
Pre-2011 Activities
Balance at December 31, 2010	$	712		$	3,263		$	3,975
Provision		117			—			117
Change in estimate		155			(485	)		(330	)
Cash payments		(984	)		(916	)		(1,900	)
Balance at December 31, 2011		—			1,862			1,862
Cash payments		—			(189	)		(189	)
Balance at April 1, 2012		—			1,673			1,673
Cash payments		—			(209	)		(209	)
Balance at July 1, 2012	$	—		$	1,464		$	1,464
2011 Activities
Q1 2011 Activity:
Provision	$	572		$	—		$	572
Cash payments		(476	)		—			(476	)
Balance at December 31, 2011		96			—			96
Cash payments		(96	)		—			(96	)
Balance at April 1, 2012	$	—		$	—		$	—
Q2 2011 Activity:
Provision	$	344		$	—		$	344
Cash payments		(115	)		—			(115	)
Balance at December 31, 2011		229			—			229
Cash payments		(229	)		—			(229	)
Balance at April 1, 2012	$	—		$	—		$	—
2012 Activities
Q2 2012 Activity:
Provision	$	286		$	—		$	286
Balance at July 1, 2012	$	286		$	—		$	286
Balance at July 1, 2012	$	286		$	1,464		$	1,750

During the six months ended July 1, 2012, Teradyne recorded the following restructuring charges:

Q2 2012 Action:

• $0.3 million of severance charges related to headcount reductions of 10 people in Semiconductor Test.

During the six months ended July 3, 2011, Teradyne recorded the following restructuring charges:

Q2 2011 Action:

• $0.3 million of severance charges related to headcount reductions of 2 people in Semiconductor Test.

Q1 2011 Action:

• $0.6 million of severance charges related to headcount reductions of 5 people in Semiconductor Test.

Pre-2011 Actions:

• $(0.5) million related to changes in the estimated exit costs related to the Westford, MA and Poway, CA facilities in Systems Test Group, and the North Reading, MA facility in Semiconductor Test and Systems Test Group.