Core Viewpoint - Teradyne's recent earnings report shows a mixed performance with revenues increasing year-over-year, but earnings per share declining, leading to questions about the sustainability of its positive stock trend [2][5]. Financial Performance - Teradyne reported Q3 2025 non-GAAP earnings of 85 cents per share, exceeding estimates by 8.97%, but down 5.6% year-over-year [2]. - Revenues reached $769 million, surpassing estimates by 3.32% and reflecting a 4.3% increase year-over-year [2]. - Revenue breakdown: Semiconductor Test platforms contributed $606 million (78.8%), Robotics $75 million (9.8%), and Product Test $88 million (11.4%) [3]. Cost and Margin Analysis - Non-GAAP gross margin was 58.5%, a decrease of 120 basis points year-over-year [3]. - Selling and administrative expenses rose 7.3% year-over-year to $169.1 million, accounting for 22% of revenues, an increase of 60 basis points [4]. - Engineering and development expenses increased 6.2% year-over-year to $124.8 million, representing 16.2% of revenues, up 30 basis points [4]. - Non-GAAP operating income fell 4.9% year-over-year to $156.9 million, with an operating margin contraction of 200 basis points to 20.4% [5]. Balance Sheet and Cash Flow - As of September 28, 2025, cash and cash equivalents were $297.7 million, down from $367.9 million as of June 29, 2025 [6]. - Net cash provided by operating activities for the quarter was $49 million [6]. Future Guidance - For Q4 2025, Teradyne anticipates revenues between $920 million and $1 billion, with non-GAAP earnings projected between $1.20 and $1.46 per share [6]. Market Sentiment and Estimates - Following the earnings release, there has been a 33.35% upward revision in consensus estimates, indicating positive market sentiment [7]. - Teradyne currently holds a Zacks Rank 2 (Buy), suggesting expectations for above-average returns in the coming months [10]. VGM Scores - Teradyne has a poor Growth Score of F and a similar score for momentum, with a D grade for value, placing it in the bottom 40% for value investors [8][9].

Core Insights - Teradyne reported third-quarter 2025 non-GAAP earnings of 85 cents per share, exceeding the Zacks Consensus Estimate by 8.97% but down 5.6% year over year [1][9] - Revenues reached $769 million, surpassing the Zacks Consensus Estimate by 3.32% and increasing 4.3% year over year [1][9] - The stock price of Teradyne surged 22.32% in pre-market trading following the earnings report [1] Revenue Breakdown - Revenue from Semiconductor Test platforms was $606 million, accounting for 78.8% of total revenues; Robotics generated $75 million (9.8%); and Product Test contributed $88 million (11.4%) [2] - Non-GAAP gross margin for the quarter was 58.5%, a contraction of 120 basis points year over year [2] Expense Analysis - Selling and administrative expenses rose 7.3% year over year to $169.1 million, representing 22% of revenues, an increase of 60 basis points [3] - Engineering and development expenses increased 6.2% year over year to $124.8 million, making up 16.2% of revenues, up 30 basis points [3] Operating Performance - Non-GAAP operating income declined 4.9% year over year to $156.9 million, with an operating margin of 20.4%, down 200 basis points year over year [4] Financial Position - As of September 28, 2025, Teradyne's cash and cash equivalents totaled $297.7 million, down from $367.9 million as of June 29, 2025 [5] - Net cash provided by operating activities for the quarter was $49 million [5] Future Guidance - For the fourth quarter of 2025, Teradyne anticipates revenues between $920 million and $1 billion, with non-GAAP earnings expected to range from $1.20 to $1.46 per share [6][9] Market Position - Teradyne holds a Zacks Rank 2 (Buy) [7] - Other notable stocks in the Zacks Computer and Technology sector include Alkami Technology (Rank 1), AMETEK, and Advanced Energy (both Rank 2) [7]

Q2 2025 Financial Performance - Revenue for Q2 2025 was $652 million[4, 5, 10, 14, 18], exceeding the mid-point of guidance[10, 18] - Non-GAAP gross margin was 57.3%[4, 6, 12, 14], above the mid-point of guidance[8] - Non-GAAP EPS was $0.57[4, 7, 9, 10, 14, 18], also exceeding the mid-point of guidance[10, 18] - The company repurchased 1.5 million shares for $119 million, at an average price of approximately $80 per share[9] Business Unit Performance - Semiconductor Test sales were $492 million, down 12% year-over-year[9, 15] - Memory Test sales decreased 53% year-over-year[9, 15] - IST sales increased 98% year-over-year[12, 15] - Product Test sales were $85 million, up 7% year-over-year[9, 12, 15] - Robotics sales decreased 17% year-over-year but increased 9% quarter-over-quarter[9, 12, 15, 19] Q3 2025 Outlook - Revenue is expected to be between $710 million and $770 million[10, 17, 20] - Non-GAAP EPS is projected to range from $0.69 to $0.87[10, 17, 20] - The company anticipates a gross margin between 56.5% and 57.5%[12, 17, 21] - Operating expenses are expected to be between 36.5% and 38.5% of sales[12, 17, 21]