SUPPLEMENTARY INFORMATION

(Unaudited)

The following sets forth certain unaudited consolidated quarterly statements of operations data for each of Teradyne’s last eight quarters. In management’s opinion, this quarterly information reflects all adjustments, consisting only of normal recurring adjustments, necessary for a fair statement for the periods presented. Such quarterly results are not necessarily indicative of future results of operations and should be read in conjunction with the audited consolidated financial statements of Teradyne and the notes thereto included elsewhere herein.


	2012
	1st Quarter			2nd Quarter			3rd Quarter			4th Quarter
	(1)			(2)			(3)			(4)(5)(6)
	(in thousands, except per share amounts)
Net revenues:
Products	$	330,891		$	480,578		$	393,037		$	179,063
Services		65,777			67,706			70,357			69,341

Total net revenues		396,668			548,284			463,394			248,404
Cost of revenues:
Cost of products		174,001			206,498			169,782			92,599
Cost of services		31,741			32,280			33,412			30,400

Total cost of revenues		205,742			238,778			203,194			122,999

Gross profit		190,926			309,506			260,200			125,405

Operating expenses:
Engineering and development		60,135			66,532			63,055			61,660
Selling and administrative		67,777			73,366			69,921			70,436
Acquired intangible assets amortization		18,429			18,429			18,429			18,221
Restructuring and other, net		(1,825	)		(6,262	)		683			(317	)

Total operating expenses		144,516			152,065			152,088			150,000

Income (loss) from operations		46,410			157,441			108,112			(24,595	)
Interest income		893			874			1,067			1,256
Interest expense and other		(6,059	)		(6,323	)		(6,154	)		(6,946	)

Income (loss) from continuing operations before income taxes		41,244			151,992			103,025			(30,285	)
Provision (benefit) for income taxes		7,680			40,605			14,384			(13,742	)

Income (loss) from continuing operations		33,564			111,387			88,641			(16,543	)
Income from discontinued operations before income taxes		—			—			—			—
(Benefit) provision for income taxes		—			—			—			—

Income from discontinued operations		—			—			—			—

Net income (loss)	$	33,564		$	111,387		$	88,641		$	(16,543	)

Income (loss) per common share from continuing operations—basic	$	0.18		$	0.60		$	0.47		$	(0.09	)

Income (loss) per common share from continuing operations—diluted	$	0.15		$	0.49		$	0.39		$	(0.09	)

Net income (loss) per common share—basic	$	0.18		$	0.60		$	0.47		$	(0.09	)

Net income (loss) per common share—diluted	$	0.15		$	0.49		$	0.39		$	(0.09	)

(1)	Restructuring and other, net includes a ($1.8) million fair value adjustment to decrease the LitePoint acquisition contingent consideration.

(2)	Restructuring and other, net includes $0.3 million of severance charges related to headcount reductions of 10 people in Semiconductor Test and ($6.5) million fair value adjustment to decrease the LitePoint acquisition contingent consideration.

(3)	Restructuring and other, net includes $0.7 million of severance charges related to the headcount reductions of 9 people, of which $0.5 million and 7 people were in Systems Test Group, $0.2 million and 2 people were in Wireless Test.

(4)	Restructuring and other, net includes a ($0.4) million fair value adjustment to decrease LitePoint acquisition contingent consideration.

(5)	In the fourth quarter ended December 31, 2012, we corrected prior period income tax provision (benefit) errors that resulted in a $0.2 million income tax provision. These errors were not individually or in aggregate material to the fourth quarter of 2012 or any prior period.

(6)

In the fourth quarter ended December 31, 2012, the change in recognizing pension and postretirement benefit plans expense, as a result of the mark-to-market adjustments, decreased gross profit and net income by $8.1 million and $18.3 million, respectively. See Note B: “Accounting Policies” for a discussion of our accounting policy.


	2011
	1st Quarter			2nd Quarter			3rd Quarter			4th Quarter
	(1)			(2)			(3)			(4)(5)
	(in thousands, except per share amounts)
Net revenues:
Products	$	315,719		$	341,316		$	274,944		$	228,212
Services		61,442			69,203			69,445			68,780

Total net revenues		377,161			410,519			344,389			296,992
Cost of revenues:
Cost of products		152,880			160,491			138,088			127,477
Cost of services		31,389			35,438			35,927			35,548

Total cost of revenues		184,269			195,929			174,015			163,025

Gross profit		192,892			214,590			170,374			133,967

Operating expenses:
Engineering and development		47,144			48,394			45,896			56,364
Selling and administrative		57,573			58,028			54,775			64,943
Acquired intangible assets amortization		7,291			7,291			6,754			19,129
Restructuring and other, net		413			1,041			1,465			3,824

Total operating expenses		112,421			114,754			108,890			144,260

Income (loss) from operations		80,471			99,836			61,484			(10,293	)
Interest income		1,287			1,403			3,049			878
Interest expense and other		(6,176	)		(5,316	)		(6,068	)		(6,134	)

Income (loss) from continuing operations before taxes		75,582			95,923			58,465			(15,549	)
Provision (benefit) for income taxes		5,486			7,839			1,759			(144,620	)

Income from continuing operations		70,096			88,084			56,706			129,071
Income (loss) from discontinued operations before income taxes		1,278			—			—			—
Income tax provision		(267	)		—			—			—

Income from discontinued operations		1,545			—			—			—
Gain (loss) on disposal of discontinued operations (net of income tax provision of $4,578)		25,203			(832	)		—			—

Net income	$	96,844		$	87,252		$	56,706		$	129,071

Income per common share from continuing operations—basic	$	0.38		$	0.48		$	0.31		$	0.70

Income per common share from continuing operations—diluted	$	0.30		$	0.38		$	0.26		$	0.58

Net income per common share—basic	$	0.52		$	0.47		$	0.31		$	0.70

Net income per common share—diluted	$	0.42		$	0.38		$	0.26		$	0.58

(1)	Restructuring and other, net includes $0.8 million of severance charges related to headcount reductions of approximately 5 people in Semiconductor Test and $(0.4) million credit related to early exit of previously impaired leased facilities in Westford and North Reading, Massachusetts.

(2)	Restructuring and other, net includes $0.3 million of severance charges related to headcount reductions of approximately 2 people in Semiconductor Test and $0.7 million related to pension settlement charges.

(3)	Restructuring and other, net includes $1.4 million of charges related to the acquisition of LitePoint.

(4)	Restructuring and other, net includes $0.5 million of charges related to pension settlement and $3.3 million to the acquisition of LitePoint.

(5)

In the fourth quarter ended December 31, 2011, the change in recognizing pension and postretirement benefit plans expense, as a result of the mark-to-market adjustments, decreased gross profit and net income by $2.4 million and $6.1 million, respectively. See Note B: “Accounting Policies” for a discussion of our accounting policy.