TLDR
- Teradyne’s Q3 revenue of $769 million topped analyst forecasts by 3% with 4% year-over-year growth
- The company posted adjusted EPS of $0.85, beating the $0.79 consensus estimate
- Q4 guidance projects revenue up to $1 billion, far exceeding $816.64 million expectations
- Shares spiked 22% in after-hours trading following the earnings announcement
- Sanjay Mehta steps down as CFO with Michelle Turner taking over November 3
Teradyne stock exploded higher in Tuesday’s after-hours session, jumping 22% after the semiconductor testing company reported third-quarter results that blew past Wall Street expectations. The rally positions the stock for what could be its strongest single-day gain on record.
The company brought in $769 million in Q3 revenue, marking a 4% increase from the same period last year. Analysts had projected $743.85 million.
Adjusted earnings landed at $0.85 per share. The consensus estimate stood at $0.79.
CEO Greg Smith pointed to exceptional performance from the semiconductor test division. The unit delivered sales that exceeded internal projections and pushed overall company results to the high end of guidance.
System-on-a-Chip testing solutions for AI applications powered much of the growth. The memory testing segment also turned in strong numbers during the quarter.
Guidance Crushes Expectations
The real story emerged in Teradyne’s forward outlook. Management forecast Q4 revenue between $920 million and $1 billion.
That range represents 25% growth compared to last year’s fourth quarter. It also marks a 27% sequential jump from Q3.
Expected adjusted EPS for Q4 falls between $1.20 and $1.46. This excludes amortization costs related to acquired assets and the company’s Technoprobe investment.
Both guidance metrics demolished analyst projections. The Street had penciled in $816.64 million in revenue and $1.02 in adjusted earnings per share.
Smith highlighted robust AI-related testing demand across multiple chip categories. Compute processors, networking chips, and memory components all show strength heading into year-end.
Retail Sentiment Shifts
Message volume on the stock surged 3,700% in the 24 hours after results dropped. Traders shared bullish price targets and technical analysis suggesting a breakout.
One user projected the stock hitting $200. Another flagged Teradyne breaking out from a multi-month consolidation pattern.
The stock closed regular trading Tuesday at $144.38, down 2.12% on the day. Year-to-date gains total 15%, while the 12-month return stands at 27.50%.
Leadership Transition
Teradyne announced CFO Sanjay Mehta will exit the role effective November 3. Mehta joined as finance chief in 2019.
Michelle Turner will assume CFO responsibilities. Mehta remains with the company as an executive advisor to assist with capacity expansion initiatives driven by testing equipment demand.
His retirement is planned for 2026. The timing coincides with Teradyne ramping production to meet semiconductor industry needs.
Analyst price targets average $143.81 according to Koyfin data. That implies roughly flat performance from Tuesday’s closing price.
The stock has climbed 38.61% over the past three months as AI infrastructure spending continues. If Wednesday’s regular session mirrors the after-hours move, Teradyne will record its best trading day in company history.
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