Financial Instruments (Tables)

9 Months Ended

Sep. 29, 2024

Schedule of Fair Value of Financial Assets and Liabilities Measured on Recurring Basis

The following tables set forth by fair value hierarchy Teradyne’s financial assets and liabilities that were measured at fair value on a recurring basis as of September 29, 2024, and December 31, 2023.

	September 29, 2024
	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in thousands)
Assets
Cash	$	198,946	$	—	$	—	$	198,946
Cash equivalents		308,000		3,090		—		311,090
Available-for-sale securities:
U.S. Treasury securities		—		41,833		—		41,833
Corporate debt securities		—		37,149		—		37,149
Certificates of deposit and time deposits		—		21,741		—		21,741
Debt mutual funds		8,640		—		—		8,640
U.S. government agency securities		—		3,931		—		3,931
Non-U.S. government securities		—		801		—		801
Equity securities:
Mutual funds		53,480		—		—		53,480
	$	569,066	$	108,545	$	—	$	677,611
Derivative assets		—		332		—		332
Total	$	569,066	$	108,877	$	—	$	677,943
Liabilities
Derivative liabilities		—		1,435		—	$	1,435
Total	$	—	$	1,435	$	—	$	1,435
Reported as follows:
	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets
Cash and cash equivalents	$	506,946	$	3,090	$	—	$	510,036
Marketable securities		—		41,631		—		41,631
Long-term marketable securities		62,120		63,824		—		125,944
Other current assets		—		332		—		332
Total	$	569,066	$	108,877	$	—	$	677,943
Liabilities
Other current liabilities		—		1,435		—		1,435
Total	$	—	$	1,435	$	—	$	1,435

	December 31, 2023
	Quoted Prices in Active Markets for Identical Instruments (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in thousands)
Assets
Cash	$	298,156	$	—	$	—	$	298,156
Cash equivalents		453,298		6,117		—		459,415
Available-for-sale securities:
Corporate debt securities		—		52,734		—		52,734
U.S. Treasury securities		—		41,808		—		41,808
Certificates of deposit and time deposits		—		21,772		—		21,772
Debt mutual funds		8,773		—		—		8,773
U.S. government agency securities		—		4,892		—		4,892
Commercial paper		—		1,667		—		1,667
Non-U.S. government securities		—		810		—		810
Equity securities:
Mutual Funds		47,132		—		—		47,132
	$	807,359	$	129,800	$	—	$	937,159
Derivative assets		—		18,746		—		18,746
Total	$	807,359	$	148,546	$	—	$	955,905
Liabilities
Derivative liabilities		—		2,545		—		2,545
Total	$	—	$	2,545	$	—	$	2,545
Reported as follows:
	(Level 1)		(Level 2)		(Level 3)		Total
	(in thousands)
Assets
Cash and cash equivalents	$	751,454	$	6,117	$	—	$	757,571
Marketable securities		—		62,154		—		62,154
Long-term marketable securities		55,905		61,529		—		117,434
Other current assets		—		18,746		—		18,746
Total	$	807,359	$	148,546	$	—	$	955,905
Liabilities
Other current liabilities	$	—	$	2,545	$	—	$	2,545
Total	$	—	$	2,545	$	—	$	2,545

Schedule of Carrying Amounts and Fair Values of Financial Instruments

The carrying amounts and fair values of Teradyne’s financial instruments at September 29, 2024, and December 31, 2023, were as follows:

	September 29, 2024				December 31, 2023
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(in thousands)
Assets
Cash and cash equivalents	$	510,036	$	510,036	$	757,571	$	757,571
Marketable securities		167,575		167,575		179,588		179,588
Derivative assets		332		332		18,746		18,746
Liabilities
Derivative liabilities		1,435		1,435		2,545		2,545

Schedule of Available-for-Sale Marketable Securities

The following table summarizes the composition of available-for-sale marketable securities at September 29, 2024:

	September 29, 2024
	Available-for-Sale
	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value		Fair Market Value of Investments with Unrealized Losses
	(in thousands)
U.S. Treasury securities	$	45,522	$	106	$	(3,795	)	$	41,833	$	22,985
Corporate debt securities	$	39,986	$	323	$	(3,160	)	$	37,149	$	25,248
Certificates of deposit and time deposits		21,741		—		—			21,741		—
Debt mutual funds		8,846		—		(206	)		8,640		3,319
U.S. government agency securities		3,921		11		(1	)		3,931		876
Non-U.S. government securities		801		—		—			801		—
	$	120,817	$	440	$	(7,162	)	$	114,095	$	52,428

Reported as follows:

	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value		Fair Market Value of Investments with Unrealized Losses
	(in thousands)
Marketable securities	$	41,673		20	$	(62	)	$	41,631	$	9,973
Long-term marketable securities		79,144		420		(7,100	)		72,464		42,455
	$	120,817	$	440	$	(7,162	)	$	114,095	$	52,428

The following table summarizes the composition of available-for-sale marketable securities at December 31, 2023:

	December 31, 2023
	Available-for-Sale
	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value		Fair Market Value of Investments with Unrealized Losses
	(in thousands)
Corporate debt securities	$	56,458	$	201	$	(3,925	)	$	52,734	$	44,263
U.S. Treasury securities		45,725		14		(3,931	)		41,808		35,080
Certificates of deposit and time deposits		21,772		—		—			21,772		—
Debt mutual funds		9,081		—		(308	)		8,773		3,303
U.S. government agency securities		4,898		—		(6	)		4,892		4,892
Commercial paper		1,633		34		—			1,667		—
Non-U.S. government securities		810		—		—			810		—
	$	140,377	$	249	$	(8,170	)	$	132,456	$	87,538

Reported as follows:

	Cost		Unrealized Gain		Unrealized (Loss)			Fair Market Value		Fair Market Value of Investments with Unrealized Losses
	(in thousands)
Marketable securities	$	62,385	$	36	$	(267	)		62,154	$	34,844
Long-term marketable securities		77,992		213		(7,903	)		70,302		52,694
	$	140,377	$	249	$	(8,170	)	$	132,456	$	87,538

Contractual Maturities of Investments Held

The contractual maturities of investments in available-for-sale securities held at September 29, 2024, were as follows:

	September 29, 2024
	Cost		Fair Market Value
	(in thousands)
Due within one year	$	41,673	$	41,631
Due after 1 year through 5 years		25,690		25,729
Due after 5 years through 10 years		7,950		7,908
Due after 10 years		36,658		30,187
Total	$	111,971	$	105,455

Schedule of Notional Amount of Derivatives

At September 29, 2024, and December 31, 2023, Teradyne had the following contracts to buy and sell non-U.S. currencies for U.S. dollars and other non-U.S. currencies with the following notional amounts:

	Net Notional Value
	September 29, 2024		December 31, 2023
	(in millions)
Currency Hedged (Buy/Sell)
U.S. dollar/Taiwan dollar		29.6		42.7
U.S. dollar/Japanese yen		21.7		11.0
U.S. dollar/Korean won		8.9		7.2
U.S. dollar/British pound sterling		1.0		1.5
U.S. dollar/Danish krone		—		36.0
Danish krone/U.S. dollar		25.7		0.7
Euro/U.S. dollar		24.8		25.3
Singapore dollar/U.S. dollar		23.0		16.6
Philippine peso/U.S. dollar		9.7		10.1
Chinese yuan/U.S. dollar		1.7		1.0
Total	$	146.1	$	152.1

Schedule of Foreign Currency Cash Flow Hedges

At September 29, 2024, and December 31, 2023, Teradyne had the following cash flow hedge contracts to buy and sell non-U.S. currencies for U.S. dollars with the following notional amounts:

	Net Notional Value
	September 29, 2024		December 31, 2023
	(in millions)
Currency Hedged (Buy/Sell)
U.S. dollar/Japanese yen	$	12.1	$	35.5
Total	$	12.1	$	35.5

Schedule of Derivative Instruments in Statement of Financial Position at Fair Value

The following table summarizes the fair value of derivative instruments as of September 29, 2024, and December 31, 2023:

	Balance Sheet Location	September 29, 2024			December 31, 2023
		(in thousands)
Derivatives not designated as hedging instruments:
Foreign exchange forward contracts	Other current assets		332			733
Foreign exchange forward contracts	Other current liabilities		(1,102	)		(2,545	)
Foreign exchange option contracts	Other current assets		—			17,364
Derivatives designated as hedging instruments:
Foreign exchange forward contracts	Other current assets		—			648
Foreign exchange forward contracts	Other current liabilities		(333	)		—
Total derivatives		$	(1,103	)	$	16,200

Schedule of Effect of Derivative Instruments on Statement of Operations Recognized

The following table summarizes the effect of derivative instruments recognized in the statement of operations for the three and nine months ended September 29, 2024, and October 1, 2023:

		For the Three Months  Ended					For the Nine Months  Ended
	Location of (Gains) Losses Recognized in Statement of Operations	September 29, 2024		October 1, 2023			September 29, 2024			October 1, 2023
		(in thousands)					(in thousands)
Derivatives not designated as hedging instruments:
Foreign exchange forward contracts (1)	Other (income) expense, net	$	4,829	$	(1,886	)	$	686		$	(4,667	)
Foreign exchange option contracts	Other (income) expense, net		—		—			9,764			—
Derivatives designated as hedging instruments:
Foreign exchange forward and option contracts	Revenue		—		(3,960	)		(2,280	)		(2,008	)
Total Derivatives		$	4,829	$	(5,846	)	$	8,170		$	(6,675	)

(1)The table does not reflect the corresponding gains and losses from the remeasurement of the monetary assets and liabilities denominated in foreign currencies. For the three and nine months ended September 29, 2024, net losses (gains) from remeasurement of monetary assets and liabilities denominated in foreign currencies were $(2.9) million and $3.1 million, respectively. For the three and nine months ended October 1, 2023, net losses from remeasurement of monetary assets and liabilities denominated in foreign currencies were $5.3 million and $12.3 million, respectively.