Product Warranty

9 Months Ended

Oct. 03, 2021

Product Warranties Disclosures [Abstract]

Product Warranty

K. PRODUCT WARRANTY

Teradyne generally provides a one-year warranty on its products, commencing upon installation, acceptance 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 Nine Months Ended
	October 3, 2021			September 27, 2020			October 3, 2021			September 27, 2020
	(in thousands)
Balance at beginning of period	$	25,676		$	13,016		$	16,633		$	8,996
Accruals for warranties issued during the period		6,641			8,255			28,719			19,522
Accruals related to pre-existing warranties		(963	)		158			(3,966	)		1,569
Settlements made during the period		(5,233	)		(6,272	)		(15,265	)		(14,930	)
Balance at end of period	$	26,121		$	15,157		$	26,121		$	15,157

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 short and long-term deferred revenue and customer advances.

	For the Three Months Ended						For the Nine Months Ended
	October 3, 2021			September 27, 2020			October 3, 2021			September 27, 2020
	(in thousands)
Balance at beginning of period	$	63,525		$	40,178		$	51,929		$	30,677
Deferral of new extended warranty revenue		12,728			13,674			36,533			32,724
Recognition of extended warranty deferred revenue		(8,771	)		(5,149	)		(20,980	)		(14,698	)
Balance at end of period	$	67,482		$	48,703		$	67,482		$	48,703