Income Taxes (Tables)
|
12 Months Ended |
Dec. 31, 2014
|
Income (loss) Before Income Taxes |
The components
of income (loss) before income taxes and the provision for income
taxes as shown in the consolidated statements of operations were as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014 |
|
|
2013 |
|
|
2012 |
|
|
|
(in
thousands) |
|
Income (loss) before income
taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S.
|
|
$ |
(151,889 |
) |
|
$ |
79,229 |
|
|
$ |
112,008 |
|
Non-U.S.
|
|
|
247,265 |
|
|
|
122,693 |
|
|
|
153,968 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$ |
95,376 |
|
|
$ |
201,922 |
|
|
$ |
265,976 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision (benefit) for
income taxes:
|
|
|
|
|
|
|
|
|
|
|
|
|
Current:
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Federal
|
|
$ |
5,197 |
|
|
$ |
18,051 |
|
|
$ |
22,695 |
|
Non-U.S.
|
|
|
28,157 |
|
|
|
22,509 |
|
|
|
18,261 |
|
State
|
|
|
678 |
|
|
|
(269 |
) |
|
|
(12 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
34,032 |
|
|
|
40,291 |
|
|
|
40,944 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred:
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Federal
|
|
|
(20,449 |
) |
|
|
(1,692 |
) |
|
|
8,158 |
|
Non-U.S.
|
|
|
(404 |
) |
|
|
(1,386 |
) |
|
|
5,997 |
|
State
|
|
|
925 |
|
|
|
(238 |
) |
|
|
(6,172 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(19,928 |
) |
|
|
(3,316 |
) |
|
|
7,983 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total provision for income
taxes:
|
|
$ |
14,104 |
|
|
$ |
36,975 |
|
|
$ |
48,927 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Effective Tax Rate |
A reconciliation
of the effective tax rate for the years 2014, 2013 and 2012
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014 |
|
|
2013 |
|
|
2012 |
|
U.S. statutory federal tax
rate
|
|
|
35.0 |
% |
|
|
35.0 |
% |
|
|
35.0 |
% |
Foreign taxes
|
|
|
(58.1 |
) |
|
|
(11.4 |
) |
|
|
(10.5 |
) |
Goodwill
impairment
|
|
|
36.3 |
|
|
|
— |
|
|
|
— |
|
U.S. research and
development credit
|
|
|
(7.9 |
) |
|
|
(7.2 |
) |
|
|
— |
|
Uncertain tax
positions
|
|
|
7.9 |
|
|
|
4.2 |
|
|
|
(1.2 |
) |
Other permanent
items
|
|
|
3.4 |
|
|
|
(0.1 |
) |
|
|
(2.8 |
) |
Valuation
allowance
|
|
|
— |
|
|
|
0.4 |
|
|
|
(0.5 |
) |
State income taxes, net of
federal tax benefit
|
|
|
(0.1 |
) |
|
|
0.1 |
|
|
|
(1.7 |
) |
Other, net
|
|
|
(1.7 |
) |
|
|
(2.7 |
) |
|
|
0.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14.8 |
% |
|
|
18.3 |
% |
|
|
18.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred Tax Assets (Liabilities) |
Significant
components of Teradyne’s deferred tax assets (liabilities) as
of December 31, 2014 and 2013 were as follows:
|
|
|
|
|
|
|
|
|
|
|
2014 |
|
|
2013 |
|
|
|
(in
thousands) |
|
Deferred tax
assets:
|
|
|
|
|
|
|
|
|
Net operating loss
carryforwards
|
|
$ |
10,989 |
|
|
$ |
14,679 |
|
Tax credits
|
|
|
50,554 |
|
|
|
65,210 |
|
Pension
liability
|
|
|
30,036 |
|
|
|
22,966 |
|
Inventory
valuations
|
|
|
29,105 |
|
|
|
38,452 |
|
Accruals
|
|
|
23,323 |
|
|
|
17,828 |
|
Equity
compensation
|
|
|
11,131 |
|
|
|
10,498 |
|
Deferred revenue
|
|
|
10,242 |
|
|
|
12,379 |
|
Vacation accrual
|
|
|
7,425 |
|
|
|
7,291 |
|
Other
|
|
|
1,725 |
|
|
|
2,613 |
|
|
|
|
|
|
|
|
|
|
Gross deferred tax
assets
|
|
|
174,530 |
|
|
|
191,916 |
|
|
|
|
|
|
|
|
|
|
Less: valuation
allowance
|
|
|
(41,737 |
) |
|
|
(40,386 |
) |
|
|
|
|
|
|
|
|
|
Total deferred tax
assets
|
|
|
132,793 |
|
|
|
151,530 |
|
|
|
|
|
|
|
|
|
|
Deferred tax
liabilities:
|
|
|
|
|
|
|
|
|
Marketable
securities
|
|
|
(1,599 |
) |
|
|
(794 |
) |
Intangible
assets
|
|
|
(64,871 |
) |
|
|
(89,268 |
) |
Excess of tax over book
depreciation
|
|
|
(24,905 |
) |
|
|
(24,458 |
) |
|
|
|
|
|
|
|
|
|
Total deferred tax
liabilities
|
|
|
(91,375 |
) |
|
|
(114,520 |
) |
|
|
|
|
|
|
|
|
|
Net deferred
assets
|
|
$ |
41,418 |
|
|
$ |
37,010 |
|
|
|
|
|
|
|
|
|
|
|
Operating Loss Carryforwards |
At
December 31, 2014, Teradyne had operating loss carryforwards
that expire in the following years:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. Federal
Operating Loss
Carryforwards |
|
|
State
Operating Loss
Carryforwards |
|
|
Foreign
Operating Loss
Carryforwards |
|
|
|
(in
thousands) |
|
2015
|
|
$ |
— |
|
|
$ |
1 |
|
|
$ |
— |
|
2016
|
|
|
— |
|
|
|
56 |
|
|
|
— |
|
2017
|
|
|
— |
|
|
|
738 |
|
|
|
— |
|
2018
|
|
|
— |
|
|
|
679 |
|
|
|
— |
|
2019
|
|
|
— |
|
|
|
133 |
|
|
|
— |
|
2020-2025
|
|
|
10,698 |
|
|
|
2,686 |
|
|
|
— |
|
2026-2028
|
|
|
— |
|
|
|
676 |
|
|
|
— |
|
Beyond 2028
|
|
|
806 |
|
|
|
3,055 |
|
|
|
115 |
|
Non-expiring
|
|
|
— |
|
|
|
— |
|
|
|
8,460 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$ |
11,504 |
|
|
$ |
8,024 |
|
|
$ |
8,575 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrecognized Tax Benefits |
Teradyne’s gross unrecognized tax benefits for the years
ended December 31, 2014, 2013 and 2012 were as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2014 |
|
|
2013 |
|
|
2012 |
|
|
|
(in
thousands) |
|
Beginning balance, as of
January 1
|
|
$ |
21,203 |
|
|
$ |
18,666 |
|
|
$ |
19,391 |
|
Additions:
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax positions for current
year
|
|
|
8,414 |
|
|
|
4,586 |
|
|
|
459 |
|
Tax positions for prior
years
|
|
|
3,781 |
|
|
|
2,112 |
|
|
|
2,259 |
|
Reductions:
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax positions for prior
years
|
|
|
(2,480 |
) |
|
|
(4,161 |
) |
|
|
(3,443 |
) |
Settlements with tax
authorities
|
|
|
(500 |
) |
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ending Balance as of
December 31
|
|
$ |
30,418 |
|
|
$ |
21,203 |
|
|
$ |
18,666 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|