Teradyne Shares Drop as Q3 Revenue Forecast Falls Short of Estimates
Bollywood Fever: Teradyne has projected third-quarter revenue below Wall Street expectations, indicating sluggish demand for its semiconductor-testing equipment. This announcement led to a more than 7% decline in the company’s shares during extended trading.
The demand for Teradyne’s products, particularly in the automobile sector, remains weak as customers are dealing with excess inventory from stockpiling during the pandemic. Teradyne, known for designing and developing technology to test chips and electronic equipment, also sells robotic systems to manufacturing sector customers. Among its notable clients are Qualcomm and Texas Instruments.
Teradyne has forecasted third-quarter revenue in the range of $680 million to $740 million, with the midpoint falling below analysts’ average estimate of $717.7 million, according to LSEG data. Additionally, the company predicts adjusted earnings per share (EPS) for the third quarter to be between 66 cents and 86 cents, compared to the analysts’ estimate of 86 cents.
Despite these projections, Teradyne’s second-quarter revenue rose by about 7% to $730 million, surpassing the estimate of $701.2 million. CEO Greg Smith noted in a statement, “In the second quarter, AI applications drove accelerated demand from both compute and memory customers, and our robotics business grew sequentially and year-over-year.
For the quarter ending June 30, the company earned an adjusted EPS of 86 cents, exceeding the expected 77 cents per share.
The North Reading, Massachusetts-based company now faces challenges as it navigates the fluctuating demands in the semiconductor market while leveraging opportunities in AI and robotics.
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