Teradyne (TER) 8-K Teradyne Reports Third Quarter 2011 Results

Exhibit 99.1

Teradyne Reports Third Quarter 2011 Results

- 20% operating profit rate

- Q3’11 revenue of $344 million, down 16% from Q2’11 and down 30% from Q3’10

- Q3’11 diluted non-GAAP income from continuing operations of $0.34 per share, down from $0.50 per share in Q2’11 and down from $0.80 per share in Q3’10; Q3’11 diluted GAAP income from continuing operations of $0.25 per share

- Q4’11 guidance including impact of LitePoint acquisition: Revenue of $270 million to $300 million; Diluted non-GAAP income from continuing operations of $0.08 to $0.16 per share; Diluted GAAP loss from continuing operations of $0.10 to $0.02 per share

NORTH READING, Mass. – October 26, 2011 –Teradyne, Inc. (NYSE: TER) reported revenue of $344 million for the third quarter of 2011 of which $241 million was in Semiconductor Test and $103 million in Systems Test Group. On a non-GAAP basis, Teradyne’s income from continuing operations in the third quarter was $66.1 million, or $0.34 per diluted share, which excluded acquired intangible asset amortization, non-cash convertible debt interest and acquisition related costs. GAAP income from continuing operations for the third quarter was $54.7 million, or $0.25 per diluted share.

Bookings in the third quarter of 2011 were $240 million of which $196 million were in Semiconductor Test and $44 million in the Systems Test Group.

“Record hard disk drive test shipments in the third quarter combined with our lean operating model to produce our seventh consecutive quarter of above model profitability,” said Mike Bradley, Teradyne President and CEO. “Semiconductor test orders and revenue softened in line with industry trends during the quarter, but we continued to see relative strength in the mobility segments driven by power management, image sensors, wireless and mobile processors.”

“Our recent acquisition of LitePoint adds another growth engine to Teradyne’s portfolio of test solutions,” noted Bradley. “This strategic use of capital significantly enlarges our served market into wireless product testing.”

Guidance for the fourth quarter of 2011 is for revenue of $270 million to $300 million, with non-GAAP income from continuing operations per diluted share of $0.08 to $0.16 and GAAP loss from continuing operations per diluted share of $0.10 to $0.02. Non-GAAP guidance excludes acquired intangible asset amortization, non-cash convertible debt interest, acquisition related costs and estimated GAAP purchase accounting charges related to the LitePoint acquisition.

Webcast

A conference call to discuss the third quarter 2011 results, along with management’s business outlook is scheduled at 10 a.m. EDT, Thursday, October 27. The call will be broadcast simultaneously over the Internet. Interested investors should access the webcast atwww.teradyne.com and click on “Investors” at least five minutes before the call begins.

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A replay will be available approximately two hours after the completion of the call. The replay number in the U.S. & Canada is 855-859-2056. The replay number outside the U.S. & Canada is 404-537-3406. The pass code for both numbers is 19277276. A replay will also be available on the Teradyne website atwww.teradyne.com and by phone. The phone replay will be available through November 12, 2011.

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 income from continuing operations exclude acquired intangible asset amortization, non- cash convertible debt interest, and restructuring and other, net. GAAP requires that these items be included in determining income from operations and income from continuing operations. Non-GAAP income from operations, non-GAAP income from continuing operations, non-GAAP income from operations and non-GAAP income from continuing operations as a percentage of revenue, and non-GAAP income from continuing operations per share are non-GAAP 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 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 diluted shares include the impact of Teradyne’s call option on its shares. Management believes each of these non-GAAP 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 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 Automatic Test Equipment used to test semiconductors, wireless products, data storage and complex electronic systems which serve consumer, communications, industrial and government customers. In 2010, Teradyne had sales of $1.6 billion and employs approximately 3,200 people worldwide. For more information, visitwww.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 and market conditions. Such statements are based on the current assumptions and expectations of Teradyne’s management and are neither promises nor guarantees of future performance. You can identify these forward-looking statements based on the context of the statements and by the fact that they use words such as “will,” “anticipate,” “expect,” “project,” “intend,” “plan,” “believe,” “target” and other words and terms of similar meaning in connection with any discussion of future operating or financial performance.

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There can be no assurance that management’s estimates of Teradyne’s future results or other forward looking statements will be achieved. Important factors that could cause actual results to differ materially from those presently expected include: conditions affecting the markets in which Teradyne operates; decreased or delayed product demand; increased competition in certain markets resulting from the merger of Advantest and Verigy; the future business prospects of Teradyne’s LitePoint business unit; 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, 2010 and Quarterly Report on Form 10-Q for the period ended July 3, 2011. 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 2011

CONDENSED CONSOLIDATED OPERATING STATEMENTS

(In thousands, except per share amounts)

	Quarter Ended									Nine Months Ended
	October 2, 2011			July 3, 2011			October 3, 2010			October 2, 2011			October 3, 2010
Net Revenues	$	344,389		$	410,519		$	491,391		$	1,132,069		$	1,256,000
Cost of Revenues (1)		174,544			195,433			219,592			554,729			563,423
Gross Profit		169,845			215,086			271,799			577,340			692,577
Operating Expenses:
Engineering and Development		46,799			47,393			49,048			142,169			146,326
Selling and Administrative		55,304			57,481			60,560			171,014			172,977
Acquired Intangible Asset Amortization		6,754			7,291			7,291			21,336			21,959
Restructuring and Other, net (2)		1,465			1,279			(1,977	)		3,157			(703	)
Operating Expenses		110,322			113,444			114,922			337,676			340,559
Income from Operations		59,523			101,642			156,877			239,664			352,018
Interest & Other (3)		(3,019	)		(3,913	)		(4,567	)		(11,821	)		(13,706	)
Income from Continuing Operations Before Income Taxes		56,504			97,729			152,310			227,843			338,312
Income Tax Provision		1,759			7,839			6,606			15,084			20,909
Income from Continuing Operations		54,745			89,890			145,704			212,759			317,403
Income from Discontinued Operations Before Income Taxes (4)		—			—			1,706			1,278			2,326
Income Tax Provision (Benefit)		—			—			70			(267	)		140
Income from Discontinued Operations		—			—			1,636			1,545			2,186
(Loss) Gain on Disposal of Discontinued Operations (net of income tax provision of $0, $0, $0, $4,578, and $0, respectively)		—			(832	)		—			24,371			—
Net Income	$	54,745		$	89,058		$	147,340		$	238,675		$	319,589
Income per Common Share from Continuing Operations:
Basic	$	0.30		$	0.48		$	0.80		$	1.15		$	1.77
Diluted	$	0.25		$	0.39		$	0.65		$	0.93		$	1.44
Net Income per Common Share:
Basic	$	0.30		$	0.48		$	0.81		$	1.29		$	1.78
Diluted	$	0.25		$	0.39		$	0.66		$	1.05		$	1.45
Weighted Average Common Shares - Basic		185,102			185,367			181,239			185,063			179,365
Weighted Average Common Shares - Diluted (5)		221,892			230,452			229,389			228,141			229,069
Net Orders	$	239,500		$	333,170		$	340,859		$	1,007,747		$	1,369,426

(1) Cost of Revenues includes:

	Quarter Ended									Nine Months Ended
	October 2, 2011			July 3, 2011			October 3, 2010			October 2, 2011			October 3, 2010
Sale of Previously Written Down Inventory	$	(1,455	)	$	(764	)	$	(1,312	)	$	(5,241	)	$	(6,544	)
Provision for Excess and Obsolete Inventory		4,413			1,716			3,727			10,756			5,181
	$	2,958		$	952		$	2,415		$	5,515		$	(1,363	)

(2) Restructuring and Other, net consists of:

	Quarter Ended							Nine Months Ended
	October 2, 2011		July 3, 2011		October 3, 2010			October 2, 2011			October 3, 2010
Acquisition Costs(a)	$	1,328	$	—	$	—		$	1,328		$	—
Employee Severance		137		344		910			1,325			2,184
Non-U.S. Pension Settlement		—		935		—			935			—
Facility Related		—		—		(2,887	)		(431	)		(2,887	)
	$	1,465	$	1,279	$	(1,977	)	$	3,157		$	(703	)

(a) Costs related to LitePoint acquisition. The results of LitePoint will be included in Teradyne’s results starting October 6, 2011.

(3) Interest & Other includes:

	Quarter Ended						Nine Months Ended
	October 2, 2011		July 3, 2011		October 3, 2010		October 2, 2011		October 3, 2010
Non-Cash Convertible Debt Interest	$	3,059	$	2,957		2,669	$	8,874	$	7,743

(4) On March 21, 2011, Teradyne completed the sale of its Diagnostic Solutions business unit to SPX Corporation for a gain of $24.4 million. The results for the discontinued business unit have been included within discontinued operations for all periods presented.

(5) Under GAAP, when calculating diluted earnings per share, convertible debt must be assumed to have converted if the effect on EPS would be dilutive. Diluted shares assume the conversion of the convertible debt as the effect would be dilutive. Accordingly, for the quarters ended October 2, 2011, July 3, 2011, and October 3, 2010, 19.5 million, 22.7 million and 34.7 million shares, respectively, have been included in diluted shares and net interest expense of $0, $0 and $4.4 million, respectively, has been added back to income from continuing operations and net income for the diluted earnings per share calculations. For the nine months ended October 2, 2011 and October 3, 2010, 21.9 million and 34.7 million shares, respectively, have been included in diluted shares and net interest expense of $0 and $13.2 million, respectively, has been added back to income from continuing operations and net income for the diluted earnings per share calculations.

CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands)

	October 2, 2011		December 31, 2010
Assets
Cash and Cash Equivalents	$	1,095,163	$	397,737
Marketable Securities		96,536		409,061
Accounts Receivable		143,523		168,756
Inventories		133,339		116,841
Deferred Tax Assets		23,176		22,730
Prepayments and Other Current Assets		64,087		52,780
Current Assets from Discontinued Operations (1)		—		8,713
Total Current Assets		1,555,824		1,176,618
Net Property, Plant and Equipment		232,576		231,108
Long-Term Marketable Securities		40,712		248,696
Retirement Plan Assets		14,684		13,981
Intangible Assets		101,604		122,941
Other Assets		17,277		16,542
Long-Term Assets from Discontinued Operations (1)		—		469
Total Assets	$	1,962,677	$	1,810,355
Liabilities
Accounts Payable	$	77,768	$	81,142
Accrued Employees’ Compensation and Withholdings		75,495		105,374
Deferred Revenue and Customer Advances		79,464		105,568
Other Accrued Liabilities		52,554		57,145
Accrued Income Taxes		5,135		8,465
Current Debt		2,605		2,450
Current Liabilities from Discontinued Operations (1)		—		3,560
Total Current Liabilities		293,021		363,704
Long-Term Deferred Revenue and Customer Advances		39,358		71,558
Retirement Plan Liabilities		74,718		72,071
Deferred Tax Liabilities		9,946		9,849
Other Long-Term Liabilities		18,908		19,448
Long-Term Debt		156,839		150,182
Long-Term Liabilities from Discontinued Operations (1)		—		1,355
Total Liabilities		592,790		688,167
Shareholders’ Equity		1,369,887		1,122,188
Total Liabilities and Shareholders’ Equity	$	1,962,677	$	1,810,355

(1) On March 21, 2011, Teradyne completed the sale of its Diagnostic Solutions business unit to SPX Corporation. The assets and liabilities of the discontinued business unit have been included within discontinued operations at December 31, 2010.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands)

	Quarter Ended						Nine Months Ended
	October 2, 2011			October 3, 2010			October 2, 2011			October 3, 2010
Cash flows from operating activities:
Net income	$	54,745		$	147,340		$	238,675		$	319,589
Less: Income from discontinued operations		—			1,636			1,545			2,186
Less: Gain on disposal of discontinued operations		—			—			24,371			—
Income from continuing operations		54,745			145,704			212,759			317,403
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
Depreciation		12,781			13,051			38,426			39,469
Amortization		12,256			11,506			37,547			34,610
Stock-based compensation		7,832			7,618			22,514			22,758
Provision for excess and obsolete inventory		4,413			3,727			10,756			5,181
Tax benefit related to stock options and restricted stock units		3,717			—			—			—
Other		(45	)		194			1,379			1,852
Changes in operating assets and liabilities, net of businesses sold:
Accounts receivable		64,300			(57,868	)		25,233			(181,052	)
Inventories		13,972			(14,524	)		(1,034	)		9,696
Other assets		(3,205	)		(14,513	)		(13,553	)		1,031
Deferred revenue and customer advances		(29,965	)		138,428			(58,304	)		76,020
Accounts payable and accrued expenses		(38,204	)		43,352			(47,483	)		95,289
Retirement plan contributions		(1,152	)		(26,172	)		(6,393	)		(50,849	)
Accrued income taxes		(8,470	)		3,279			(3,064	)		14,625
Net cash provided by continuing operations		92,975			253,782			218,783			386,033
Net cash provided by (used for) discontinued operations		—			2,029			(4,225	)		3,757
Net cash provided by operating activities		92,975			255,811			214,558			389,790
Cash flows from investing activities:
Purchases of property, plant and equipment		(22,156	)		(18,253	)		(66,623	)		(53,959	)
Purchases of available-for-sale marketable securities		(94,720	)		(254,440	)		(593,261	)		(478,260	)
Proceeds from sales of available-for-sale marketable securities		692,378			47,580			1,112,855			94,846
Proceeds from sales of trading marketable securities		—			50			—			23,750
Proceeds from life insurance		—			—			—			1,091
Net cash provided by (used for) continuing operations		575,502			(225,063	)		452,971			(412,532	)
Net cash provided by discontinued operations		—			—			39,062			—
Net cash provided by (used for) investing activities		575,502			(225,063	)		492,033			(412,532	)
Cash flows from financing activities:
Issuance of common stock		164			353			17,216			42,225
Tax benefit related to stock options and restricted stock units		(3,717	)		—			—			—
Payments of long-term debt		(1,296	)		(1,182	)		(2,518	)		(2,305	)
Repurchase of common stock		(23,863	)		—			(23,863	)		—
Net cash (used for) provided by financing activities		(28,712	)		(829	)		(9,165	)		39,920
Increase in cash and cash equivalents		639,765			29,919			697,426			17,178
Cash and cash equivalents at beginning of period		455,398			403,996			397,737			416,737
Cash and cash equivalents at end of period	$	1,095,163		$	433,915		$	1,095,163		$	433,915

GAAP to Non-GAAP Earnings Reconciliation

(In millions, except per share amounts)

	Quarter Ended
	October 2, 2011			% of Net Revenues							July 3, 2011			% of Net Revenues							October 3, 2010			% of Net Revenues
Net Revenues	$	344.4									$	410.5									$	491.4
Income from Operations - GAAP	$	59.5			17.3	%					$	101.6			24.8	%					$	156.9			31.9	%
Acquired intangible asset amortization		6.8			2.0	%						7.3			1.8	%						7.3			1.5	%
Restructuring and other, net(1)		1.5			0.4	%						1.3			0.3	%						(2.0	)		-0.4	%
Income from Operations - non-GAAP	$	67.8			19.7	%					$	110.2			26.8	%					$	162.2			33.0	%
							Income per Common Share from Continuing Operations										Income per Common Share from Continuing Operations										Income per Common Share from Continuing Operations
	October 2, 2011			% of Net Revenues			Basic		Diluted		July 3, 2011			% of Net Revenues			Basic		Diluted		October 3, 2010			% of Net Revenues			Basic			Diluted
Income from Continuing Operations - GAAP	$	54.7			15.9	%	$	0.30	$	0.25	$	89.9			21.9	%	$	0.48	$	0.39	$	145.7			29.6	%	$	0.80		$	0.65
Acquired intangible asset amortization		6.8			2.0	%		0.04		0.03		7.3			1.8	%		0.04		0.04		7.3			1.5	%		0.04			0.04
Restructuring and other, net(1)		1.5			0.4	%		0.01		0.01		1.3			0.3	%		0.01		0.01		(2.0	)		-0.4	%		(0.01	)		(0.01	)
Convertible share adjustment(2)		—			—			—		0.03		—			—			—		0.05		—			—			—			0.11
Interest and other(3)		3.1			0.9	%		0.02		0.02		3.0			0.7	%		0.02		0.01		2.7			0.5	%		0.01			0.01
Income from Continuing Operations - non-GAAP	$	66.1			19.2	%	$	0.36	$	0.34	$	101.5			24.7	%	$	0.55	$	0.50	$	153.7			31.3	%	$	0.85		$	0.80
GAAP and Non-GAAP Weighted Average Common Shares - Basic		185.1										185.4										181.2
GAAP Weighted Average Common Shares - Diluted		221.9										230.5										229.4
Exclude dilutive shares from convertible note		(19.5	)									(22.7	)									(34.7	)
Non-GAAP Weighted Average Common Shares - Diluted (2)		202.4										207.8										194.7
(1)    Restructuring and other, net consists of (in millions):
	Quarter Ended
	October 2, 2011										July 3, 2011										October 3, 2010
Acquisition Costs	$	1.3									$	—									$	—
Employee Severance		0.1										0.3										0.9
Non-U.S. Pension Settlement		—										0.9										—
Facility Related		—										—										(2.9	)
	$	1.5									$	1.3									$	(2.0	)

(2) For the quarters ended October 2, 2011, July 3, 2011 and October 3, 2010, the calculation of non-GAAP diluted earnings per share gives benefit to the Company’s call option on its stock for 34.7 million shares at $5.48. As a result, 13.5 million, 17.9 million and 8.5 million shares, respectively, have been included in non-GAAP diluted shares and net interest expense of $2.4 million has been added back to non-GAAP net income for the non-GAAP diluted earnings per share calculation.

(3) For the quarters ended October 2, 2011, July 3, 2011 and October 3, 2010, Interest and Other included non-cash convertible debt interest.

	Nine Months Ended
	October 2, 2011		% of Net Revenues			October 3, 2010			% of Net Revenues
Net Revenues	$	1,132.1				$	1,256.0
Income from Operations - GAAP	$	239.7		21.2	%	$	352.0			28.0	%
Acquired intangible asset amortization		21.3		1.9	%		22.0			1.8	%
Restructuring and other, net(1)		3.2		0.3	%		(0.7	)		-0.1	%
Income from Operations - non-GAAP	$	264.2		23.3	%	$	373.3			29.7	%

							Income per Common  Share from Continuing Operations										Income per Common  Share from Continuing Operations
	October 2, 2011			% of Net Revenues			Basic		Diluted		October 3, 2010			% of Net Revenues			Basic		Diluted
Income from Continuing Operations - GAAP	$	212.8			18.8	%	$	1.15	$	0.93	$	317.4			25.3	%	$	1.77	$	1.44
Acquired intangible asset amortization		21.3			1.9	%	$	0.12		0.10		22.0			1.8	%		0.12		0.11
Interest and other(2)		8.9			0.8	%	$	0.05		0.04		7.7			0.6	%		0.04		0.04
Restructuring and other, net(1)		3.2			0.3	%	$	0.02		0.02		(0.7	)		-0.1	%		—		—
Convertible share adjustment(3)		—			—		$	—		0.14		—			—			—		0.23
Income from Continuing Operations - non-GAAP	$	246.2			21.7	%	$	1.33	$	1.23	$	346.4			27.6	%	$	1.93	$	1.82
GAAP and Non-GAAP Weighted Average Common Shares - Basic		185.1										179.4
GAAP Weighted Average Common Shares -Diluted		228.1										229.1
Exclude dilutive shares from convertible note		(21.9	)									(34.7	)
Non-GAAP Weighted Average Common Shares - Diluted(3)		206.2										194.4

(1) Restructuring and other, net consists of:

	Nine Months Ended
	October 2, 2011			October 3, 2010
Acquisition Costs	$	1.3		$	—
Employee Severance		1.3			2.2
Non-U.S. Pension Settlement		0.9			—
Facility Related		(0.4	)		(2.9	)
	$	3.2		$	(0.7	)

(2) For the nine months ended October 2, 2011 and October 3 , 2010, Interest and Other included non-cash convertible debt interest.

(3) For the nine months ended October 2, 2011 and October 3, 2010, the calculation of non-GAAP diluted earnings per share gives benefit to the Company’s call option on its stock for 34.7 million shares at $5.48. As a result, 16.7 million and 9.6 million shares, respectively, have been included in non-GAAP diluted shares and net interest expense of approximately $7.1 million has been added back to non-GAAP net income for the non-GAAP diluted earnings per share calculation.

GAAP to Non-GAAP Reconciliation of Fourth Quarter 2011 guidance:

GAAP and Non-GAAP fourth quarter revenue guidance:	$	270	million to	$	300	million
GAAP loss from continued operations per diluted share	$	(0.10	)	$	(0.02	)
Exclude LitePoint purchase accounting charges and intangible asset amortization		0.10			0.10
Exclude LitePoint acquisition related costs		0.02			0.02
Exclude acquired intangible asset amortization		0.03			0.03
Exclude non-cash convertible debt interest		0.02			0.02
Non GAAP weighted average diluted share adjustment		0.01			0.01
Non-GAAP income from continuing operations per diluted share	$	0.08		$	0.16

For press releases and other information of interest to investors, please visit Teradyne’s homepage at http://www.teradyne.com.

Contact:	Teradyne, Inc.
	Andy Blanchard 978-370-2425
	Vice President of Corporate Relations