Income Taxes (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of Income (Loss) Before Income Taxes and Provision (Benefit) for Income Taxes from Operations

The components of income before income taxes and the provision (benefit) for income taxes as shown in the consolidated statements of operations were as follows:

	2023			2022			2021
	(in thousands)
Income before income taxes:
U.S.	$	307,997		$	385,968		$	403,451
Non-U.S.		217,575			454,417			757,504
	$	525,572		$	840,385		$	1,160,955
Provision (benefit) for income taxes:
Current:
U.S. Federal	$	58,063		$	86,692		$	58,218
Non-U.S.		54,037			74,204			105,153
State		2,362			2,681			300
		114,462			163,577			163,671
Deferred:
U.S. Federal		(27,459	)		(36,739	)		(15,106	)
Non-U.S.		(8,584	)		1,232			(4,300	)
State		(1,599	)		(3,186	)		2,101
		(37,642	)		(38,693	)		(17,305	)
Total provision for income taxes:	$	76,820		$	124,884		$	146,366

Reconciliation of Effective Tax Rate

A reconciliation of the effective tax rate for the years 2023, 2022 and 2021 is as follows:

	2023			2022			2021
U.S. statutory federal tax rate		21.0	%		21.0	%		21.0	%
Foreign taxes		2.5			(1.9	)		(4.5	)
Non-deductible officers’ compensation		1.1			1.3			0.8
U.S. global intangible low-taxed income		0.8			1.2			0.6
State income taxes, net of federal tax benefit		0.1			(0.1	)		0.2
U.S. research and development credit		(4.2	)		(1.8	)		(1.4	)
U.S. foreign derived intangible income		(3.9	)		(3.1	)		(2.3	)
Foreign tax credits		(3.3	)		(1.0	)		(0.5	)
Equity compensation		(0.4	)		(1.1	)		(1.0	)
Other, net		0.9			0.4			(0.3	)
		14.6	%		14.9	%		12.6	%

Deferred Tax Assets (Liabilities)

Significant components of Teradyne’s deferred tax assets (liabilities) as of December 31, 2023 and 2022 were as follows:

	2023			2022
	(in thousands)
Deferred tax assets:
Tax credits	$	112,571		$	105,503
Research and development		82,571			47,760
Accruals		25,644			30,747
Pension liabilities		24,997			21,335
Lease liabilities		21,167			18,679
Inventory valuations		19,289			22,554
Deferred revenue		13,807			14,909
Equity compensation		7,179			6,578
Vacation accrual		6,096			5,856
Net operating loss carryforwards		5,737			1,857
Investment impairment		3,292			3,292
Intangible assets		2,323			350
Marketable securities		128			2,283
Other		953			2,520
Gross deferred tax assets		325,754			284,223
Less: valuation allowance		(109,251	)		(103,807	)
Total deferred tax assets	$	216,503		$	180,416
Deferred tax liabilities:
Right of use assets	$	(19,016	)	$	(16,607	)
Depreciation		(16,681	)		(19,078	)
Contingent consideration		(5,214	)		(5,214	)
Total deferred tax liabilities	$	(40,911	)	$	(40,899	)
Net deferred assets	$	175,592		$	139,517

Operating Loss Carryforwards

At December 31, 2023, Teradyne had tax effected operating loss carryforwards that expire in the following years:

	State Operating Loss Carryforwards		Foreign Operating Loss Carryforwards
	(in thousands)
2024	$	6	$	—
2025		4		—
2026		—		—
2027		—		—
2028		23		83
2029-2033		121		500
2034-2038		31		—
Beyond 2038		—		—
Non-expiring		30		4,939
Total	$	215	$	5,522

Unrecognized Tax Benefits

Teradyne’s gross unrecognized tax benefits for the years ended December 31, 2023, 2022 and 2021 were as follows:

	2023			2022			2021
	(in thousands)
Beginning balance as of January 1	$	15,608		$	14,465		$	17,903
Additions:
Tax positions for current year		—			1,398			1,417
Tax positions for prior years		3,024			13			30
Reductions:
Tax positions for prior years		(26	)		(56	)		(1,639	)
Expiration of statutes		—			(212	)		(3,246	)
Ending balance as of December 31	$	18,606		$	15,608		$	14,465