- Q3’16 orders up 20% compared with Q3’15
- Q3’16 revenue and earnings exceeded guidance on strength of semiconductor mobile device test demand
- Semiconductor Test revenues for the first 9 months up 10%, $101 million, compared with 2015
NORTH READING, Mass. — (BUSINESS WIRE) — October 26, 2016 — Teradyne, Inc. (NYSE: TER):
Q3’16 |
Q3’15 |
Q2’16 |
|||||||||||||
Orders (mil) | $378 | $314 | $471 | ||||||||||||
Revenue (mil) | $410 | $466 | $532 | ||||||||||||
GAAP EPS | $0.31 | $0.34 | $(1.10) | ||||||||||||
Non-GAAP EPS | $0.33 | $0.40 | $0.55 |
Teradyne, Inc. (NYSE: TER) reported revenue of $410 million for the third quarter of 2016 of which $322 million was in Semiconductor Test, $37 million in System Test, $28 million in Wireless Test, and $24 million in Industrial Automation. GAAP net income for the third quarter was $63.8 million or $0.31 per share. On a non-GAAP basis, Teradyne’s net income in the third quarter was $67.7 million, or $0.33 per diluted share, which excluded acquired intangible asset amortization, restructuring and other charges, discrete income tax adjustments, and included the related tax impact on non-GAAP adjustments.
Orders in the third quarter of 2016 were $378 million of which $250 million were in Semiconductor Test, $76 million in System Test, $29 million in Wireless Test, and $24 million in Industrial Automation.
“Third quarter revenue came in above our guidance based on strong demand for our UltraFLEX System-on-a-Chip system,” said CEO and President Mark Jagiela. “While tester demand remained strong for mobile devices, we also saw a pick-up in orders for automotive analog and microcontroller testers. This, combined with across the board strength in System Test and Universal Robots, leads us to increase our fourth quarter production plan and puts us on track to deliver annual sales over $1.7B and above model operating profits.”
Guidance for the fourth quarter of 2016 is revenue of $330 million to $360 million, with GAAP net income of $0.17 to $0.26 per diluted share and non-GAAP net income of $0.18 to $0.25 per diluted share. Non-GAAP guidance excludes acquired intangible asset amortization and includes the related tax impact on non-GAAP adjustments.
Webcast
A conference call to discuss the third quarter
results, along with management's business outlook, will follow at 10
a.m. ET, Thursday, October 27. Interested investors should access the
webcast at
www.teradyne.com
and click on "Investors" at least five minutes before the call begins.
Presentation materials will be available starting at 10 a.m. ET. A
replay will be available on the Teradyne website at
www.teradyne.com/investors.
Non-GAAP Results
In addition to disclosing results that are
determined in accordance with GAAP, Teradyne also discloses non-GAAP
results of operations that exclude certain income items and charges.
These results are provided as a complement to results provided in
accordance with GAAP. Non-GAAP income from operations and non-GAAP net
income exclude goodwill and intangible asset impairment charges,
acquired intangible asset amortization, pension actuarial gains and
losses, fair value inventory step-up related to Universal Robots,
discrete income tax adjustments, restructuring and other, and a gain
from the sale of an equity investment. GAAP requires that these items be
included in determining income from operations and net income. Non-GAAP
income from operations, non-GAAP net income, non-GAAP income from
operations and non-GAAP net income as a percentage of revenue, and
non-GAAP net income per share are non-GAAP performance measures
presented to provide meaningful supplemental information regarding
Teradyne's baseline performance before gains, losses or other charges
that may not be indicative of Teradyne’s current core business or future
outlook. These non-GAAP performance measures are used to make
operational decisions, to determine employee compensation, to forecast
future operational results, and for comparison with Teradyne’s business
plan, historical operating results and the operating results of
Teradyne’s competitors. Non-GAAP gross margin excludes inventory step-up
and pension actuarial gains and losses. GAAP requires that these items
be included in determining gross margin. Non-GAAP gross margin dollar
amount and percentage are non-GAAP performance measures that management
believes provide useful supplemental information for management and the
investor. Management uses non-GAAP gross margin as a performance measure
for Teradyne’s current core business and future outlook and for
comparison with Teradyne’s business plan, historical gross margin
results and the gross margin results of Teradyne’s competitors.
Management believes each of these non-GAAP performance measures provides
useful supplemental information for investors, allowing greater
transparency to the information used by management in its operational
decision making and in the review of Teradyne’s financial and
operational performance, as well as facilitating meaningful comparisons
of Teradyne’s results in the current period compared with those in prior
and future periods. A reconciliation of each available GAAP to non-GAAP
financial measure discussed in this press release is contained in the
attached exhibits and on the Teradyne website at
www.teradyne.com
by clicking on "Investors" and then selecting the "GAAP to Non-GAAP
Reconciliation" link. The non-GAAP performance measures discussed in
this press release may not be comparable to similarly titled measures
used by other companies. The presentation of non-GAAP measures is not
meant to be considered in isolation, as a substitute for, or superior
to, financial measures or information provided in accordance with GAAP.
About Teradyne
Teradyne
(NYSE:
TER) is a leading supplier of automation equipment for test and
industrial applications. Teradyne Automatic Test Equipment (ATE) is used
to test semiconductors, wireless products, data storage and complex
electronic systems, which serve consumer, communications, industrial and
government customers. Our Industrial Automation products include
Collaborative Robots used by global manufacturing and light industrial
customers to improve quality and increase manufacturing efficiency. In
2015, Teradyne had revenue of $1.64 billion and currently employs
approximately 4,200 people worldwide. For more information, visit
www.teradyne.com.
Teradyne(R) is a registered trademark of Teradyne, Inc. in
the U.S. and other countries.
Safe Harbor Statement
This release contains forward-looking
statements regarding future business prospects, Teradyne’s results of
operations, market conditions, earnings per share, the payment of a
quarterly dividend, the repurchase of Teradyne common stock pursuant to
a share repurchase program and a senior secured credit facility. Such
statements are based on the current assumptions and expectations of
Teradyne’s management and are neither promises nor guarantees of future
performance, future events, future earnings per share, future payment of
dividends, future repurchases of common stock or future availability of,
or borrowing under, a credit facility. There can be no assurance that
management’s estimates of Teradyne’s future results or other
forward-looking statements will be achieved. Additionally, the current
dividend and share repurchase programs may be modified, suspended or
discontinued at any time. Important factors that could cause actual
results, earnings per share, dividend payments, repurchases of common
stock or borrowings under the credit facility to differ materially from
those presently expected include: conditions affecting the markets in
which Teradyne operates; decreased or delayed product demand; market
acceptance of new products; the ability to grow Universal Robots’
business; increased research and development spending; deterioration of
Teradyne’s financial condition; the consummation and success of any
mergers or acquisitions; the business judgment of the board of directors
that a declaration of a dividend, the repurchase of common stock or debt
under the credit facility is not in the company’s best interests; and
other events, factors and risks disclosed in filings with the SEC,
including, but not limited to, the “Risk Factors” section of Teradyne’s
Annual Report on Form 10-K for the fiscal year ended December 31, 2015
and the Quarterly Report on Form 10-Q for the period ended July 3, 2016.
The forward-looking statements provided by Teradyne in this press
release represent management’s views as of the date of this release.
Teradyne anticipates that subsequent events and developments may cause
management's views to change. However, while Teradyne may elect to
update these forward-looking statements at some point in the future,
Teradyne specifically disclaims any obligation to do so. These
forward-looking statements should not be relied upon as representing
Teradyne's views as of any date subsequent to the date of this release.
TERADYNE, INC. REPORT FOR THIRD FISCAL QUARTER OF 2016 | |||||||||||||||||||||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | |||||||||||||||||||||||||||||||
(In thousands, except per share amounts) | |||||||||||||||||||||||||||||||
|
Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||||||
October 2, 2016 | July 3, 2016 | October 4, 2015 | October 2, 2016 | October 4, 2015 | |||||||||||||||||||||||||||
Net revenues | $ | 410,475 | $ | 531,792 | $ | 465,994 | $ | 1,373,261 | $ | 1,321,133 | |||||||||||||||||||||
Cost of revenues (exclusive of acquired intangible assets amortization shown separately below) (1) (2) | 183,116 | 248,922 | 207,368 | 632,700 | 571,517 | ||||||||||||||||||||||||||
Gross profit | 227,359 | 282,870 | 258,626 | 740,561 | 749,616 | ||||||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||||
Engineering and development (1) | 71,400 | 76,109 | 74,027 | 220,973 | 221,309 | ||||||||||||||||||||||||||
Selling and administrative (1) | 78,794 | 81,425 | 77,481 | 239,393 | 226,595 | ||||||||||||||||||||||||||
Acquired intangible assets amortization | 8,487 | 16,244 | 20,053 | 44,725 | 49,119 | ||||||||||||||||||||||||||
Acquired intangible assets impairment (3) | - | 83,339 | - | 83,339 | - | ||||||||||||||||||||||||||
Goodwill impairment (3) | - | 254,946 | - | 254,946 | - | ||||||||||||||||||||||||||
Restructuring and other (4) | 12,177 | 2,608 | 261 | 16,372 | (124 | ) | |||||||||||||||||||||||||
Operating expenses | 170,858 | 514,671 | 171,822 | 859,748 | 496,899 | ||||||||||||||||||||||||||
Income (loss) from operations | 56,501 | (231,801 | ) | 86,804 | (119,187 | ) | 252,717 | ||||||||||||||||||||||||
Interest and other (5) | 3,180 | 984 | 604 | 5,242 | 9,264 | ||||||||||||||||||||||||||
Income (loss) before income taxes | 59,681 | (230,817 | ) | 87,408 | (113,945 | ) | 261,981 | ||||||||||||||||||||||||
Income tax (benefit) provision | (4,113 | ) | (7,271 | ) | 15,955 | (4,178 | ) | 54,863 | |||||||||||||||||||||||
Net income (loss) | $ | 63,794 | $ | (223,546 | ) | $ | 71,453 | $ | (109,767 | ) | $ | 207,118 | |||||||||||||||||||
Net income (loss) per common share: |
|||||||||||||||||||||||||||||||
Basic | $ | 0.32 | $ | (1.10 | ) | $ | 0.34 | $ | (0.54 | ) | $ | 0.97 | |||||||||||||||||||
Diluted | $ | 0.31 | $ | (1.10 | ) | $ | 0.34 | $ | (0.54 | ) | $ | 0.96 | |||||||||||||||||||
Weighted average common shares - basic | 202,211 | 203,018 | 210,032 | 203,167 | 213,688 | ||||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||||
Weighted average common shares - diluted | 203,929 | 203,018 | 211,736 | 203,167 | 215,348 | ||||||||||||||||||||||||||
Cash dividend declared per common share | $ | 0.06 | $ | 0.06 | $ | 0.06 | $ | 0.18 | $ | 0.18 | |||||||||||||||||||||
Net orders | $ | 378,461 | $ | 471,026 | $ | 314,222 | $ | 1,238,904 | $ | 1,333,272 | |||||||||||||||||||||
(1 | ) | Pension actuarial losses (gains) included in our operating results were as follows: | |||||||||||||||||||||||||||||
Quarter Ended | Nine Months Ended | ||||||||||||||||||||||||||||||
October 2, 2016 | July 3, 2016 | October 4, 2015 | October 2, 2016 | October 4, 2015 | |||||||||||||||||||||||||||
Cost of revenues | $ | 364 | $ | (221 | ) | $ | - | $ | (250 | ) | $ | - | |||||||||||||||||||
Engineering and development | 106 | (221 | ) | - | (509 | ) | - | ||||||||||||||||||||||||
Selling and administrative | 192 | (227 | ) | - | (441 | ) | - | ||||||||||||||||||||||||
$ | 662 | $ | (669 | ) | $ | - | $ | (1,200 | ) | $ | - | ||||||||||||||||||||
(2 | ) | Cost of revenues includes: | Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||||
October 2, 2016 | July 3, 2016 | October 4, 2015 | October 2, 2016 | October 4, 2015 | |||||||||||||||||||||||||||
Provision for excess and obsolete inventory | $ | 3,033 | $ | 7,742 | $ | 3,058 | $ | 15,148 | $ | 18,939 | |||||||||||||||||||||
Sale of previously written down inventory | (1,794 | ) | (5,151 | ) | (1,983 | ) | (8,113 | ) | (6,659 | ) | |||||||||||||||||||||
Inventory step-up | - | - | 972 | - | 1,567 | ||||||||||||||||||||||||||
$ | 1,239 | $ | 2,591 | $ | 2,047 | $ | 7,035 | $ | 13,847 | ||||||||||||||||||||||
(3 | ) | Goodwill and acquired intangible assets impairment related to Teradyne's Wireless Test business segment. | |||||||||||||||||||||||||||||
(4 | ) | Restructuring and other consists of: | Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||||
October 2, 2016 | July 3, 2016 | October 4, 2015 | October 2, 2016 | October 4, 2015 | |||||||||||||||||||||||||||
Contingent consideration fair value adjustment | $ | 7,974 | $ | 1,305 | $ | (1,000 | ) | $ | 10,452 | $ | (2,600 | ) | |||||||||||||||||||
Employee severance | 4,203 | 1,303 | 1,117 | 5,920 | 1,372 | ||||||||||||||||||||||||||
Impairment of fixed assets and expenses related to Japan earthquake | 312 | 5,051 | - | 5,363 | - | ||||||||||||||||||||||||||
Property insurance recovery | (312 | ) | (5,051 | ) | - | (5,363 | ) | - | |||||||||||||||||||||||
Acquisition costs | - | - | 144 | - | 1,104 | ||||||||||||||||||||||||||
$ | 12,177 | $ | 2,608 | $ | 261 | $ | 16,372 | $ | (124 | ) | |||||||||||||||||||||
(5 | ) | Interest and other includes: | Quarter Ended | Nine Months Ended | |||||||||||||||||||||||||||
October 2, 2016 | July 3, 2016 | October 4, 2015 | October 2, 2016 | October 4, 2015 | |||||||||||||||||||||||||||
Gain from the sale of an equity investment | $ | - | $ | - | $ | - | $ | - | $ | (5,406 | ) | ||||||||||||||||||||
CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) | |||||||||||||
October 2, 2016 | December 31, 2015 | ||||||||||||
Assets | |||||||||||||
Cash and cash equivalents | $ | 297,937 | $ | 264,705 | |||||||||
Marketable securities | 598,501 | 477,696 | |||||||||||
Accounts receivable | 163,213 | 211,293 | |||||||||||
Inventories, net | 115,066 | 153,588 | |||||||||||
Deferred tax assets | - | 54,973 | |||||||||||
Prepayments | 104,078 | 91,519 | |||||||||||
Other current assets | 6,393 | 6,194 | |||||||||||
Total current assets | 1,285,188 | 1,259,968 | |||||||||||
Net property, plant and equipment | 261,821 | 273,414 | |||||||||||
Marketable securities | 357,751 | 265,928 | |||||||||||
Deferred tax assets | 90,546 | 7,404 | |||||||||||
Other assets | 12,777 | 13,080 | |||||||||||
Retirement plans assets | 4,869 | 636 | |||||||||||
Intangible assets, net | 114,146 | 239,831 | |||||||||||
Goodwill | 238,589 | 488,413 | |||||||||||
Total assets | $ | 2,365,687 | $ | 2,548,674 | |||||||||
Liabilities | |||||||||||||
Accounts payable | $ | 61,890 | $ | 92,358 | |||||||||
Accrued employees' compensation and withholdings | 89,723 | 113,994 | |||||||||||
Deferred revenue and customer advances | 138,916 | 85,527 | |||||||||||
Other accrued liabilities | 56,580 | 43,727 | |||||||||||
Contingent consideration | 1,050 | 15,500 | |||||||||||
Accrued income taxes | 20,925 | 21,751 | |||||||||||
Total current liabilities | 369,084 | 372,857 | |||||||||||
Retirement plans liabilities | 108,095 | 103,531 | |||||||||||
Long-term deferred revenue and customer advances | 26,336 | 25,745 | |||||||||||
Deferred tax liabilities | 16,837 | 26,663 | |||||||||||
Long-term other accrued liabilities | 31,354 | 32,156 | |||||||||||
Long-term contingent consideration | 31,837 | 21,936 | |||||||||||
Total liabilities | 583,543 | 582,888 | |||||||||||
Shareholders' equity | 1,782,144 | 1,965,786 | |||||||||||
Total liabilities and shareholders' equity | $ | 2,365,687 | $ | 2,548,674 | |||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) | |||||||||||||||||||||||||||
Quarter Ended | Nine Months Ended | ||||||||||||||||||||||||||
October 2, 2016 | October 4, 2015 | October 2, 2016 | October 4, 2015 | ||||||||||||||||||||||||
Cash flows from operating activities: | |||||||||||||||||||||||||||
Net income (loss) | $ | 63,794 | $ | 71,453 | $ | (109,767 | ) | $ | 207,118 | ||||||||||||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | |||||||||||||||||||||||||||
Depreciation | 16,269 | 16,301 | 48,437 | 52,531 | |||||||||||||||||||||||
Amortization | 9,095 | 20,764 | 46,275 | 52,159 | |||||||||||||||||||||||
Provision for excess and obsolete inventory | 3,033 | 3,058 | 15,148 | 18,939 | |||||||||||||||||||||||
Stock-based compensation | 7,555 | 7,675 | 23,012 | 23,080 | |||||||||||||||||||||||
Contingent consideration adjustment | 7,974 | (1,000 | ) | 10,452 | (2,600 | ) | |||||||||||||||||||||
Goodwill impairment | - | - | 254,946 | - | |||||||||||||||||||||||
Acquired intangible assets impairment | - | - | 83,339 | - | |||||||||||||||||||||||
Deferred taxes | (21,110 | ) | (3,602 | ) | (42,568 | ) | (13,973 | ) | |||||||||||||||||||
Impairment of fixed assets | - | - | 4,179 | - | |||||||||||||||||||||||
Property insurance recovery | (312 | ) | - | (5,363 | ) | - | |||||||||||||||||||||
Retirement plans actuarial losses (gains) | 662 | - | (1,200 | ) | - | ||||||||||||||||||||||
Non-cash charge for the sale of inventories revalued at the date of acquisition | - | 972 | - | 1,567 | |||||||||||||||||||||||
Gain from the sale of an equity investment | - | - | - | (5,406 | ) | ||||||||||||||||||||||
Tax benefit related to employee stock compensation awards | (3,399 | ) | (2,321 | ) | (3,399 | ) | (3,213 | ) | |||||||||||||||||||
Other | (426 | ) | 1,368 | 150 | 2,523 | ||||||||||||||||||||||
Changes in operating assets and liabilities, net of business acquired: | |||||||||||||||||||||||||||
Accounts receivable | 186,371 | 51,376 | 45,660 | (91,117 | ) | ||||||||||||||||||||||
Inventories | 18,378 | 9,876 | 48,601 | 33,376 | |||||||||||||||||||||||
Prepayments and other assets | 696 | 1,475 | (12,961 | ) | 15,529 | ||||||||||||||||||||||
Accounts payable and accrued expenses | (32,749 | ) | (729 | ) | (47,941 | ) | 52,663 | ||||||||||||||||||||
Deferred revenue and customer advances | (52,692 | ) | 1,066 | 53,380 | 6,751 | ||||||||||||||||||||||
Retirement plans contributions | (3,573 | ) | (999 | ) | (5,871 | ) | (2,998 | ) | |||||||||||||||||||
Accrued income taxes | 4,221 | 2,416 | 4,227 | 25,677 | |||||||||||||||||||||||
Net cash provided by operating activities | 203,787 | 179,149 | 408,736 | 372,606 | |||||||||||||||||||||||
Cash flows from investing activities: | |||||||||||||||||||||||||||
Purchases of property, plant and equipment | (19,659 | ) | (20,617 | ) | (66,252 | ) | (66,727 | ) | |||||||||||||||||||
Purchases of available-for-sale marketable securities | (438,526 | ) | (367,356 | ) | (875,837 | ) | (957,606 | ) | |||||||||||||||||||
Proceeds from sales of available-for-sale marketable securities | 131,946 | 212,334 | 466,744 | 843,734 | |||||||||||||||||||||||
Proceeds from maturities of available-for-sale marketable securities | 74,138 | 98,947 | 202,162 | 330,363 | |||||||||||||||||||||||
Proceeds from property insurance | - | - | 5,051 | - | |||||||||||||||||||||||
Acquisition of business, net of cash acquired | - | (409 | ) | - | (282,741 | ) | |||||||||||||||||||||
Proceeds from the sale of an equity investment | - | - | - | 5,406 | |||||||||||||||||||||||
Proceeds from life insurance | - | - | - | 1,098 | |||||||||||||||||||||||
Net cash used for investing activities | (252,101 | ) | (77,101 | ) | (268,132 | ) | (126,473 | ) | |||||||||||||||||||
Cash flows from financing activities: | |||||||||||||||||||||||||||
Issuance of common stock under stock purchase and stock option plans | 2,189 | 267 | 20,085 | 18,145 | |||||||||||||||||||||||
Repurchase of common stock | (28,309 | ) | (98,527 | ) | (85,092 | ) | (226,843 | ) | |||||||||||||||||||
Dividend payments | (12,123 | ) | (12,577 | ) | (36,548 | ) | (38,434 | ) | |||||||||||||||||||
Tax benefit related to employee stock compensation awards | 3,399 | 2,321 | 3,399 | 3,213 | |||||||||||||||||||||||
Payment of revolving credit facility costs | - | - | - | (2,253 | ) | ||||||||||||||||||||||
Payment of contingent consideration | - | - | (11,697 | ) | - | ||||||||||||||||||||||
Net cash used for financing activities | (34,844 | ) | (108,516 | ) | (109,853 | ) | (246,172 | ) | |||||||||||||||||||
Effects of exchange rate changes on cash and cash equivalents | - | - | 2,481 | - | |||||||||||||||||||||||
(Decrease) increase in cash and cash equivalents | (83,158 | ) | (6,468 | ) | 33,232 | (39 | ) | ||||||||||||||||||||
Cash and cash equivalents at beginning of period | 381,095 | 300,685 | 264,705 | 294,256 | |||||||||||||||||||||||
Cash and cash equivalents at end of period | $ | 297,937 | $ | 294,217 | $ | 297,937 | $ | 294,217 | |||||||||||||||||||
GAAP to Non-GAAP Earnings Reconciliation | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(In millions, except per share amounts) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarter Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
October 2,
|
% of Net
|
July 3,
|
% of Net
|
October 4,
|
% of Net
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net revenues | $ | 410.5 | $ | 531.8 | $ | 466.0 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gross profit - GAAP | $ | 227.4 | 55.4 | % | $ | 282.9 | 53.2 | % | $ | 258.6 | 55.5 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory step-up | - | - | - | - | 1.0 | 0.2 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension mark-to-market adjustment (1) | 0.4 | 0.1 | % | (0.2 | ) | 0.0 | % | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gross profit - non-GAAP | $ | 227.8 | 55.5 | % | $ | 282.7 | 53.2 | % | $ | 259.6 | 55.7 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income (loss) from operations - GAAP | $ | 56.5 | 13.8 | % | $ | (231.8 | ) | -43.6 | % | $ | 86.8 | 18.6 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and other (2) | 12.2 | 3.0 | % | 2.6 | 0.5 | % | 0.3 | 0.1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquired intangible assets amortization | 8.5 | 2.1 | % | 16.2 | 3.0 | % | 20.1 | 4.3 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension mark-to-market adjustment (1) | 0.7 | 0.2 | % | (0.7 | ) | -0.1 | % | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill impairment (3) | - | - | 254.9 | 47.9 | % | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquired intangible assets impairment (3) | - | - | 83.3 | 15.7 | % | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory step-up | - | - | - | - | 1.0 | 0.2 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income from operations - non-GAAP | $ | 77.9 | 19.0 | % | $ | 124.5 | 23.4 | % | $ | 108.2 | 23.2 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Income
|
Net (Loss) Income
|
Net Income
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
October 2,
|
% of Net
|
Basic | Diluted |
July 3,
|
% of Net
|
Basic | Diluted |
October 4,
|
% of Net
|
Basic | Diluted | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income (loss) - GAAP | $ | 63.8 | 15.5 | % | $ | 0.32 | $ | 0.31 | $ | (223.5 | ) | -42.0 | % | $ | (1.10 | ) | $ | (1.10 | ) | $ | 71.5 | 15.3 | % | $ | 0.34 | $ | 0.34 | ||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and other (2) | 12.2 | 3.0 | % | 0.06 | 0.06 | 2.6 | 0.5 | % | 0.01 | 0.01 | 0.3 | 0.1 | % | 0.00 | 0.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquired intangible assets amortization | 8.5 | 2.1 | % | 0.04 | 0.04 | 16.2 | 3.0 | % | 0.08 | 0.08 | 20.1 | 4.3 | % | 0.10 | 0.09 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension mark-to-market adjustment (1) | 0.7 | 0.2 | % | 0.00 | 0.00 | (0.7 | ) | -0.1 | % | (0.00 | ) | (0.00 | ) | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill impairment (3) | - | - | - | - | 254.9 | 47.9 | % | 1.26 | 1.24 | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquired intangible assets impairment (3) | - | - | - | - | 83.3 | 15.7 | % | 0.41 | 0.41 | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory step-up | - | - | - | - | - | - | - | - | 1.0 | 0.2 | % | 0.00 | 0.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Exclude discrete tax adjustments (4) | (10.7 | ) | -2.6 | % | (0.05 | ) | (0.05 | ) | 25.1 | 4.7 | % | 0.12 | 0.12 | (3.3 | ) | -0.7 | % | (0.02 | ) | (0.02 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
Tax effect of non-GAAP adjustments | (6.8 | ) | -1.7 | % | (0.03 | ) | (0.03 | ) | (45.5 | ) | -8.6 | % | (0.22 | ) | (0.22 | ) | (4.7 | ) | -1.0 | % | (0.02 | ) | (0.02 | ) | |||||||||||||||||||||||||||||||||||||||||||||||||
Net income - non-GAAP | $ | 67.7 | 16.5 | % | $ | 0.33 | $ | 0.33 | $ | 112.4 | 21.1 | % | $ | 0.55 | $ | 0.55 | $ | 84.9 | 18.2 | % | $ | 0.40 | $ | 0.40 | |||||||||||||||||||||||||||||||||||||||||||||||||
GAAP and non-GAAP weighted average common shares - basic | 202.2 | 203.0 | 210.0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GAAP weighted average common shares - diluted | 203.9 | 203.0 | 211.7 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Include dilutive shares | - | 1.9 | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-GAAP weighted average common shares - diluted | 203.9 | 204.9 | 211.7 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(1) | Actuarial losses (gains) recognized under GAAP in accordance with Teradyne's mark-to-market pension accounting. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(2) | Restructuring and other consists of: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarter Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
October 2,
|
July 3,
|
October 4,
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contingent consideration fair value adjustment | $ | 8.0 | $ | 1.3 | $ | (1.0 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee severance | 4.2 | 1.3 | 1.2 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Impairment of fixed assets and expenses related to Japan earthquake | 0.3 | 5.1 | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property insurance recovery | (0.3 | ) | (5.1 | ) | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisition costs | - | - | 0.1 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | 12.2 | $ | 2.6 | $ | 0.3 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(3) | Goodwill and acquired intangible assets impairment related to Teradyne's Wireless Test business segment. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(4) |
For the quarters ended October 2, 2016, July 3, 2016 and October 4, 2015, adjustment to exclude discrete income tax items. For the quarters ended October 2, 2016 and July 3, 2016, adjustment to treat Wireless Test business segment goodwill and intangible assets impairments as discrete tax items. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nine Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
October 2,
|
% of Net
|
October 4,
|
% of Net
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Revenues | $ | 1,373.3 | $ | 1,321.1 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gross profit - GAAP | $ | 740.6 | 53.9 | % | $ | 749.6 | 56.7 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory step-up | - | - | 1.6 | 0.1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension mark-to-market adjustment (1) | (0.3 | ) | 0.0 | % | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Gross profit - non-GAAP | $ | 740.3 | 53.9 | % | $ | 751.2 | 56.9 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(Loss) income from operations - GAAP | $ | (119.2 | ) | -8.7 | % | $ | 252.7 | 19.1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill impairment (2) | 254.9 | 18.6 | % | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquired intangible assets impairment (2) | 83.3 | 6.1 | % | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquired intangible assets amortization | 44.7 | 3.3 | % | 49.1 | 3.7 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and other (3) | 16.4 | 1.2 | % | (0.1 | ) | 0.0 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension mark-to-market adjustment (1) | (1.2 | ) | -0.1 | % | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory step-up | - | - | 1.6 | 0.1 | % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income from operations - non-GAAP | $ | 278.9 | 20.3 | % | $ | 303.3 | 23.0 | % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net (Loss) Income
|
Net Income
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
October 2,
|
% of Net
|
Basic | Diluted |
October 4,
|
% of Net
|
Basic | Diluted | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net (loss) income - GAAP | $ | (109.8 | ) | -8.0 | % | $ | (0.54 | ) | $ | (0.54 | ) | $ | 207.1 | 15.7 | % | $ | 0.97 | $ | 0.96 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill impairment (2) | 254.9 | 18.6 | % | 1.25 | 1.24 | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquired intangible assets impairment (2) | 83.3 | 6.1 | % |
|
0.41 | 0.41 | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquired intangible assets amortization | 44.7 | 3.3 | % | 0.22 | 0.22 | 49.1 | 3.7 | % | 0.23 | 0.23 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Restructuring and other (3) | 16.4 | 1.2 | % | 0.08 | 0.08 | (0.1 | ) | 0.0 | % | (0.00 | ) | (0.00 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pension mark-to-market adjustment (1) | (1.2 | ) | -0.1 | % | (0.01 | ) | (0.01 | ) | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Interest and other (4) | - | - | - | - | (5.4 | ) | -0.4 | % | (0.03 | ) | (0.03 | ) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Inventory step-up | - | - | - | - | 1.6 | 0.1 | % | 0.01 | 0.01 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Exclude discrete tax adjustments (5) | 11.8 | 0.9 | % | 0.06 | 0.06 | (4.9 | ) | -0.4 | % | (0.02 | ) | (0.02 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Tax effect of non-GAAP adjustments | (55.7 | ) | -4.1 | % | (0.27 | ) | (0.27 | ) | (10.5 | ) | -0.8 | % | (0.05 | ) | (0.05 | ) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net income - non-GAAP | $ | 244.4 | 17.8 | % | $ | 1.20 | $ | 1.19 | $ | 236.9 | 17.9 | % | $ | 1.11 | $ | 1.10 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GAAP and non-GAAP weighted average common shares - basic | 203.2 | 213.7 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GAAP weighted average common shares - diluted | 203.2 | 215.3 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Include dilutive shares | 1.7 | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-GAAP weighted average common shares - diluted | 204.9 | 215.3 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(1) | Actuarial gains recognized under GAAP in accordance with Teradyne's mark-to-market pension accounting. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(2) | Goodwill and acquired intangible assets impairment related to Teradyne's Wireless Test business segment. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(3) | Restructuring and other consists of: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Nine Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
October 2,
|
October 4,
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Contingent consideration fair value adjustment | $ | 10.5 | $ | (2.6 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee severance | 5.9 | 1.4 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Impairment of fixed assets and expenses related to Japan earthquake | 5.4 | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Property insurance recovery | (5.4 | ) | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Acquisition costs | - | 1.1 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
$ | 16.4 | $ | (0.1 | ) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(4) | For the nine months ended October 4, 2015, Interest and other included a gain from the sale of an equity investment. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
(5) |
For the nine months ended October 2, 2016 and October 4, 2015, adjustment to exclude discrete income tax items. For the nine months ended October 2, 2016, adjustment to treat Wireless Test business segment goodwill and intangible assets impairments as discrete tax items. |
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GAAP to Non-GAAP Reconciliation of Fourth Quarter 2016 guidance: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GAAP and non-GAAP fourth quarter revenue guidance: | $330 million | to | $360 million | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
GAAP net income per diluted share | $ | 0.17 | $ | 0.26 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Exclude acquired intangible assets amortization | 0.04 | 0.04 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-GAAP tax adjustment | (0.03 | ) | (0.05 | ) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Non-GAAP net income per diluted share | $ | 0.18 | $ | 0.25 |
For press releases and other information of interest to investors, please visit Teradyne's homepage at http://www.teradyne.com.
View source version on businesswire.com: http://www.businesswire.com/news/home/20161026006637/en/
Contact:
Teradyne, Inc.
Andy Blanchard, 978-370-2425
Vice President of
Corporate Relations