Supplementary Information

12 Months Ended

Dec. 31, 2019

Supplementary Information

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.

	2019
	1st Quarter			2nd Quarter			3rd Quarter			4th Quarter
	(1)			(2)			(3)			(4)(5)(6)
	(in thousands, except per share amounts)
Revenues:
Products	$	393,442		$	457,511		$	488,170		$	548,552
Services		100,657			106,667			93,868			106,098
Total revenues		494,099			564,178			582,038			654,650
Cost of revenues:
Cost of products		165,368			193,299			197,196			226,184
Cost of services		41,096			46,961			39,804			45,228
Total cost of revenues (exclusive of acquired intangible assets amortization shown separately below)		206,464			240,260			237,000			271,412
Gross profit		287,635			323,918			345,038			383,238
Operating expenses:
Selling and administrative		102,013			108,811			109,166			117,092
Engineering and development		76,791			81,434			77,804			86,794
Acquired intangible assets amortization		10,634			10,083			9,647			9,784
Restructuring and other		5,112			(10,404	)		(6,500	)		(2,088	)
Total operating expenses		194,550			189,924			190,117			211,582
Income from operations		93,085			133,994			154,921			171,656
Non-operating (income) expense:
Interest income		(8,052	)		(5,430	)		(5,159	)		(6,145	)
Interest expense		5,713			5,800			5,682			5,950
Other (income) expense, net		1,445			2,447			2,665			22,965
Income before income taxes		93,979			131,177			151,733			148,886
Income tax (benefit) provision		(15,159	)		33,780			15,873			23,811
Net income	$	109,138		$	97,397		$	135,860		$	125,075
Net income per common share—basic	$	0.63		$	0.57		$	0.80		$	0.75
Net income per common share—diluted	$	0.62		$	0.55		$	0.75		$	0.69
Cash dividend declared per common share	$	0.09		$	0.09		$	0.09		$	0.09

(1) Restructuring and other includes a $3.0 million fair value adjustment to increase the MiR acquisition contingent consideration, $1.3 million of acquisition related expenses and compensation and $0.8 million of employee severance charges.

(2) Restructuring and other includes a $11.7 million gain for the decrease in the fair value of the MiR contingent consideration liability, partially offset by $0.8 million of employee severance charges and $0.5 million of acquisition related expenses and compensation.

(3) Restructuring and other includes a $7.8 million gain for the decrease in the fair value of MiR contingent consideration liability, partially offset by $0.8 million of employee severance charges and $0.5 million of acquisition related expenses and compensation.

(4) Restructuring and other includes a $5.8 million gain for the decrease in the fair value adjustment to the MiR acquisition contingent consideration, partially offset by a $3.0 million fair value adjustment to increase the AutoGuide acquisition contingent consideration, $0.5 million of employee severance charges and $0.2 million of acquisition related expenses and compensation.

(5) Teradyne recorded pension and post retirement net actuarial losses of $7.7 million for the fourth quarter in 2019. See Note B: “Accounting Policies” for a discussion of Teradyne’s accounting policy.

(6) Other (income) expense, net includes a $15.0 million charge for the impairment of the investment in RealWear.

	2018
	1st Quarter			2nd Quarter			3rd Quarter			4th Quarter
	(1)			(2)			(3)			(4)(5)
	(in thousands, except per share amounts)
Revenues:
Products	$	403,925		$	434,051		$	470,994		$	420,652
Services		83,542			92,878			95,854			98,906
Total revenues		487,467			526,929			566,848			519,558
Cost of revenues:
Cost of products		180,958			180,777			195,339			170,064
Cost of services		36,677			38,818			37,816			39,959
Total cost of revenues (exclusive of acquired intangible assets amortization shown separately below)		217,635			219,595			233,155			210,023
Gross profit		269,832			307,334			333,693			309,535
Operating expenses:
Selling and administrative		90,505			99,410			100,202			100,552
Engineering and development		74,408			75,342			77,049			74,706
Acquired intangible assets amortization		7,698			9,793			11,142			10,558
Restructuring and other		(313	)		2,389			1,710			11,446
Total operating expenses		172,298			186,934			190,103			197,262
Income from operations		97,534			120,400			143,590			112,273
Non-operating (income) expense:
Interest income		(5,981	)		(5,427	)		(6,213	)		(9,083	)
Interest expense		6,890			5,639			5,557			13,182
Other (income) expense, net		805			176			3,405			(2,954	)
Income before income taxes		95,820			120,012			140,841			111,128
Income tax provision (benefit)		8,846			18,975			20,863			(32,662	)
Net income	$	86,974		$	101,037		$	119,978		$	143,790
Net income per common share—basic	$	0.45		$	0.53		$	0.65		$	0.80
Net income per common share—diluted	$	0.43		$	0.52		$	0.63		$	0.79
Cash dividend declared per common share	$	0.09		$	0.09		$	0.09		$	0.09

(1) Restructuring and other includes a $3.5 million gain for the decrease in the fair value of the Universal Robots contingent consideration liability, partially offset by $2.5 million of acquisition related expenses and compensation and $2.4 million of employee severance charges.

(2) Restructuring and other includes a $5.0 million gain for the decrease in the fair value of the Universal Robots contingent consideration liability, partially offset by $3.9 million of employee severance charges and $0.8 million of acquisition related expenses and compensation.

(3) Restructuring and other includes $1.7 million of employee severance charges, $0.8 million of acquisition related expenses and compensation, partially offset by a $0.8 million gain for the decrease in the fair value of the Universal Robots contingent consideration liability.

(4) Restructuring and other includes a $17.7 million fair value adjustment to increase the MiR acquisition contingent consideration, $0.8 million of employee severance charges, and $0.5 million acquisition related expenses and compensation, partially offset by a $7.4 million gain for the decrease in the fair value of the Universal Robots contingent consideration liability.

(5) Teradyne recorded pension and post retirement net actuarial gains of $3.5 million for the fourth quarter in 2018. See Note B: “Accounting Policies” for a discussion of Teradyne’s accounting policy.