Teradyne, Inc. (NASDAQ:TER) shares are trading higher Tuesday after the company reported better-than-expected fourth-quarter financial results and issued first-quarter earnings guidance above estimates.
Teradyne Tops Estimates, Surprises Analysts
Teradyne reported adjusted earnings per share of $1.80, beating the consensus estimate of $1.35. In addition, the company reported revenue of $1.08 billion, beating the consensus estimate of $971.09 million.
The company said fourth-quarter performance came in above the high end of its guidance range, driven by AI-related demand in compute, networking and memory within its Semiconductor Test business. Teradyne reported Semiconductor Test revenue of $883 million in the quarter, alongside Product Test revenue of $110 million and Robotics revenue of $89 million. The company said all three business segments delivered sequential growth during the quarter.
For the full year, the company reported year-over-year growth of 13%, supported by continued demand across its testing and automation businesses.
The company sees first quarter adjusted earnings per share of $1.89 to $2.25, versus the consensus estimate of $1.24, Furthermore, it sees revenue of $1.15 billion to $1.25 billion, versus the consensus estimate of $927.72 million.
CEO Greg Smith said the company expects continued growth across all segments in 2026, supported by AI-related demand and ongoing strength in its core markets.
Analyst Says ‘Wow’
Following the earnings release, Cantor Fitzgerald analyst C.J. Muse reiterated an Overweight rating on Teradyne and maintained a $270 price target. Muse characterized the quarter as a “significant beat and raise,” citing leverage to AI-related demand across networking, compute and memory.
Muse said Teradyne's fourth-quarter results reflected strength across all businesses, driven by AI demand, and noted expectations for continued momentum into the March quarter. The analyst highlighted Semiconductor Test as the primary focus, estimating the segment accounts for approximately 82% of overall revenue, with AI-driven strength spanning networking, compute and memory applications.
“We were bullish into this report, but … wow,” the analyst wrote in the note.
Teradyne Shares Rise Higher
TER Price Action: At the time of writing, Teradyne shares are trading 12.11% higher at $279.81, according to data from Benzinga Pro.
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