Segment Information

3 Months Ended

Apr. 03, 2016

Segment Information

R. Segment Information

Teradyne has four operating segments (Semiconductor Test, System Test, Wireless Test, and Industrial Automation), 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 System Test segment includes operations related to the design, manufacturing and marketing of products and services for defense/aerospace instrumentation test, storage test and circuit-board test. The Wireless Test segment includes operations related to the design, manufacturing and marketing of wireless test products and services. The Industrial Automation segment includes operations related to the design, manufacturing and marketing of collaborative robots. 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 in effect are described in Note B: “Accounting Policies” in Teradyne’s Annual Report on Form 10-K for the year ended December 31, 2015.

Segment information for the three months ended April 3, 2016 and April 5, 2015 is as follows:

	Semiconductor Test		System Test		Wireless Test			Industrial Automation			Corporate and Eliminations		Consolidated
	(in thousands)
Three months ended April 3, 2016:
Revenues	$	340,264	$	53,670	$	20,314		$	16,746		$	—	$	430,994
Income (loss) before income taxes (1)(2)		73,254		9,492		(20,140	)		(7,168	)		1,754		57,192
Total assets (3)		664,555		90,695		408,466			350,589			1,034,669		2,548,974
Three months ended April 5, 2015:
Revenues	$	270,917	$	37,436	$	34,048		$	—		$	—	$	342,401
Income (loss) before income taxes (1)(2)		43,125		1,005		(10,441	)		—			8,749		42,438
Total assets (3)		596,477		94,133		465,465			—			1,356,107		2,512,182

(1) Interest income, interest expense, and other (income) expense, net are included in Corporate and Eliminations.

(2) Included in the income (loss) before income taxes for each of the segments are charges related to inventory and other.

(3) Total business assets are directly attributable to each business. Corporate assets consist of cash and cash equivalents, marketable securities and certain other assets.

Included in the Semiconductor Test segment are charges in the following line items in the statements of operations:

	For the Three Months Ended
	April 3, 2016		April 5, 2015
	(in thousands)
Cost of revenues—inventory charge	$	3,685	$	531
Restructuring and other		414		—
Total	$	4,099	$	531

Included in the Wireless Test segment are charges in the following line items in the statements of operations:

	For the Three Months Ended
	April 3, 2016		April 5, 2015
	(in thousands)
Cost of revenues—inventory charge	$	605	$	846
Total	$	605	$	846

Included in Corporate and Eliminations are charges and credits in the following line items in the statements of operations:

	For the Three Months Ended
	April 3, 2016		April 5, 2015
	(in thousands)
Restructuring and other—Universal Robots contingent consideration adjustment	$	1,173	$	—
Other (income) expense, net—gain from the sale of an equity investment		—		(4,782	)
Total	$	1,173	$	(4,782	)