Product Warranty

9 Months Ended

Oct. 02, 2022

Product Warranties Disclosures [Abstract]

J. 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 2, 2022			October 3, 2021			October 2, 2022			October 3, 2021
	(in thousands)
Balance at beginning of period	$	16,036		$	25,676		$	24,577		$	16,633
Accruals for warranties issued during the period		4,930			6,641			15,460			28,719
Accruals related to pre-existing warranties		(654	)		(963	)		(5,024	)		(3,966	)
Settlements made during the period		(6,181	)		(5,233	)		(20,882	)		(15,265	)

Balance at end of period	$	14,131		$	26,121		$	14,131		$	26,121

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 2, 2022			October 3, 2021			October 2, 2022			October 3, 2021
	(in thousands)
Balance at beginning of period	$	65,791		$	63,525		$	64,168		$	51,929
Deferral of new extended warranty revenue		6,987			12,728			28,550			36,533
Recognition of extended warranty deferred revenue		(10,858	)		(8,771	)		(30,798	)		(20,980	)

Balance at end of period	$	61,920		$	67,482		$	61,920		$	67,482