Teradyne (TER) 10-K risk factor changes: FY2019 vs FY2018

[removed: Risks] [added: Risks] Associated with Our [removed: Business][added: Business]

[removed: _Our] [added: Our] business is impacted by global and industry-specific economic cycles, which are difficult to predict, and actions we have taken or may take to offset these cycles may not be [removed: sufficient._][added: sufficient.]

Capital equipment providers in the [removed: electronics and] [added: electronics,] semiconductor [removed: industries,] [added: industries and industrial automation,] such as Teradyne, have, in the past, been negatively impacted by both sudden slowdowns in the global economies and recurring cyclicality [added: within those industries.]

These cycles have resulted in periods of over-supply; a trend we believe will continue to [removed: occur for newer generations of electronic products.][added: occur.]

Our business and results of operations depend, in significant part, upon capital expenditures of manufacturers of semiconductors [added: electronics] and other [removed: electronics,] [added: industrial products,] which in turn depend upon the current and anticipated market demand for those products.

[removed: _We] [added: We] are subject to intense [removed: competition._][added: competition.]

We also face competition from emerging Asian [removed: equipment] companies and internal development at several of our customers.

[removed: _The] [added: The] market for our products is concentrated, and our business depends, in part, on obtaining orders from a few significant [removed: customers._][added: customers.]

In each of the years [removed: 2018, 2017,] [added: 2019, 2018] and [removed: 2016,] [added: 2017,] our five largest [added: direct] customers in aggregate accounted for 27%, [removed: 32%,] [added: 27%] and [removed: 36%] [added: 32%] of consolidated revenues, respectively.

We estimate consolidated revenues driven by [removed: a single] [added: another] OEM customer, combining direct sales to that customer with sales to the customer’s OSATs (which include Taiwan Semiconductor Manufacturing Company [removed: Ltd. and its leasing company, JA Mitsui Leasing,] Ltd.), accounted for approximately [removed: 13%, 22%,] [added: 10%, 13%] and [removed: 26%] [added: 22%] of our consolidated revenues in [removed: 2018, 2017,] [added: 2019, 2018] and [removed: 2016,] [added: 2017,] respectively.

[removed: The] loss of a significant customer or any reduction in orders by these customers, including reductions due to market or competitive conditions, such as we experienced in our Wireless Test segment, would likely have a material adverse effect on our business, financial condition or results of operations.

[removed: _Our] [added: Our] operating results are likely to fluctuate [removed: significantly._][added: significantly.]

| | • | [removed: |] a worldwide economic slowdown or disruption in the global financial [added: or industrial] markets; |

| | • | [removed: |] competitive pressures on selling prices; |

| | • | [removed: |] our ability to introduce, and the market acceptance of, new products; |

| | • | [removed: |] changes in product revenues mix resulting from changes in customer demand; |

| | • | [removed: |] the level of orders received which can be shipped in a quarter because of the tendency of customers to wait until late in a quarter to commit to purchase due to capital expenditure approvals and constraints occurring at the end of a quarter, or the hope of obtaining more favorable pricing from a competitor seeking the business; |

| | • | [removed: |] engineering and development investments relating to new product introductions, and the expansion of manufacturing, outsourcing and engineering operations in Asia; |

| | • | [removed: |] provisions for excess and obsolete inventory relating to the lack of demand for and the discontinuance of products; |

| | • | [removed: |] impairment charges for certain long-lived and intangible assets, and goodwill; |

| | • | [removed: |] an increase in the leasing of our products to customers; |

| | • | [removed: |] our ability to expand our global distribution channel for our collaborative [added: and mobile] robots; |

| | • | [removed: |] parallel or multi-site testing [added: which] could lead to a decrease in the ultimate size of the market for our [added: semiconductor and electronic test] products; and |

| | • | [removed: |] the ability of our suppliers and subcontractors to meet product quality or delivery requirements needed to satisfy customer orders for our products, especially if consolidated revenues increase. |

[removed: _We] [added: We] are subject to risks of operating [removed: internationally._][added: internationally.]

| | • | [removed: |] unexpected changes in legal and regulatory requirements affecting international markets; |

| | • | [removed: |] changes in tariffs and exchange rates; |

| | • | [removed: |] social, political and economic instability, acts of terrorism and international conflicts; |

| | • | [removed: |] difficulties in protecting intellectual property; |

| | • | [removed: |] difficulties in accounts receivable collection; |

| | • | [removed: |] cultural differences in the conduct of business; |

| | • | [removed: |] difficulties in staffing and managing international operations; |

| | • | [removed: |] compliance with customs [added: and trade] regulations; and |

| | • | [removed: |] compliance with international tax laws and regulations. |

In addition, an increasing portion of our products and the products we purchase from our suppliers are sourced or manufactured in foreign locations, including China and Malaysia, and a large portion of the devices our products test are fabricated and tested by foundries and subcontractors in Taiwan, China, [removed: Singapore] [added: Korea] and other parts of Asia.

As a result, we are subject to a number of economic and other risks, particularly during times of [removed: political] [added: political, health] or financial instability in these regions.

[removed: _The] [added: The] implementation of tariffs and export controls on our products may have a material impact on our [removed: business._][added: business.]

[removed: On July 6, 2018 and August 23,] [added: In] 2018, the United States Trade Representative imposed a 25% tariff on [removed: two lists of] [added: many] products, including certain Teradyne products that are made in China and imported into the United States.

We have implemented operational changes that [removed: will] mitigate the impact of the 25% tariff on the import of our impacted products into the United States.

[removed: On June 29,] [added: Also in] 2018, the United States Department of Commerce announced that it has commenced a review of new export controls focusing on emerging and foundational technologies.

We estimate consolidated revenues driven by Huawei, combining direct sales to that customer with sales to the customer’s OSATs, accounted for approximately 11%, 4% and 1% of our consolidated revenues in 2019, 2018 and 2017, respectively.

The

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| | • | disruption caused by health epidemics, such as the coronavirus outbreak; |

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| | • | disruption caused by health epidemics, such as the coronavirus outbreak; |

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| | • | compliance with anti-corruption laws; |

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| | • | compliance with data privacy regulations; |

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Trade regulations and restrictions could impact our ability to sell products to and support certain customers, which may materially adversely affect our sales and results of operations.

We are subject to U.S. laws and regulations that limit and restrict the export of some of our products and services and may restrict our transactions with certain customers, business partners and other persons.

In certain circumstances, export control and economic sanctions regulations may prohibit the export of certain products, services and technologies, and in other circumstances we may be required to obtain an export license before exporting the controlled item.

We must also comply with export restrictions and laws imposed by other countries affecting trade and investments.

We maintain an export compliance program but there are risks that the compliance controls could be circumvented, exposing us to legal liabilities.

Compliance with these laws has not

significantly limited our sales, but could significantly limit them in the future.

Changes in, and responses to, U.S. trade policy could reduce the competitiveness of our products and cause our sales to drop, which could have a material adverse effect on our business, financial condition or results of operations.

The U.S. government from time to time has issued export restrictions that prohibit U.S. companies from exporting U.S. manufactured products, foreign manufactured products with more than 25% controlled U.S. content, as well as U.S. origin technology.

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within those industries.

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We have submitted requests for exclusion of our products from the tariff, but there is no assurance that our requests will be approved.

On September 24, 2018, the United States Trade Representative imposed a 10% tariff on many additional products made in China and imported into the United States.

The tariff rate may increase to 25% in 2019.

At this time, we do not expect that this tariff will significantly impact any Teradyne products and thus the tariff should not have a material adverse effect on our business, financial condition or results of operations.

The addition to the Entity List of Chinese companies who are customers or potential customers could impact the sale and/or support of certain Teradyne products to those customers or potential customers and, therefore, have a material adverse effect on our business, financial condition or results of operations.

##### [Table of Contents](#toc)

demand for those products are critical to our success.

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| | • | | ability to meet customer requirements; |

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[removed: Overview][added: Overview]

| | • | [removed: |] semiconductor test (“Semiconductor Test”) systems; |

| | • | [removed: |] defense/aerospace (“Defense/Aerospace”) test instrumentation and systems, storage test (“Storage Test”) systems, and circuit-board test and inspection (“Production Board Test”) systems (collectively these products represent “System Test”); |

| | • | [removed: |] industrial automation (“Industrial Automation”) products; and |

| | • | [removed: |] wireless test (“Wireless Test”) systems. |

[removed: One customer drives] [added: A few customers drive] significant demand for our [added: test] products both through direct sales and sales to the [removed: customer’s] [added: customers’] supply partners.

The sales of our products and services are dependent, to a large degree, on [added: these] customers who are subject to cyclical trends in the demand for their products.

These cyclical periods have had, and will continue to have, a significant effect on our business because our customers often delay or accelerate purchases in reaction to changes in their businesses and to demand fluctuations in the [removed: semiconductor and] [added: semiconductor,] electronics [added: and industrial automation] industries.

The total purchase price [removed: for Universal Robots] was approximately [removed: $315] [added: $197.8] million, which included cash paid of approximately [removed: $284] [added: $145.2] million and [removed: $32] [added: $52.6] million in fair value of contingent consideration payable upon achievement of [added: certain thresholds and targets for] revenue and earnings [removed: targets] [added: before interest and taxes] through [removed: 2018.][added: 2020.]

Contingent consideration for [removed: 2015] [added: 2018] was [removed: $15] [added: $30.8] million and was paid in [removed: February 2016.][added: March 2019.]

Contingent consideration for [removed: the period from July 2015 to December 2018] [added: 2019] was [removed: $3.9] [added: $9.1] million and [removed: it] is expected to be paid in March [removed: 2019.][added: 2020.]

MiR is [removed: the] [added: a] leading maker of collaborative autonomous mobile robots [added: (“AMRs”)] for industrial applications.

The total purchase price was approximately [removed: $198] [added: $81.7] million, which included cash paid of approximately [removed: $145] [added: $57.8] million and [removed: $53] [added: $24.0] million in fair value of contingent consideration payable upon achievement of certain [removed: thresholds and targets for revenue and earnings before interest and taxes] [added: performance targets, extending potentially] through [removed: 2020.][added: 2022.]

[removed: At December 31, 2018, the] [added: The] maximum [removed: amount of] contingent consideration that could be paid is [removed: $115] [added: $106.9] million.

[removed: Universal Robots,] MiR [removed: and Energid are] [added: is] included in our Industrial Automation segment.

We believe our recent acquisitions [added: and investments] have enhanced our opportunities for growth.

We intend to continue to invest in our business, grow market share in our markets and [removed: expand] further [added: expand] our addressable markets while tightly managing our costs.

[removed: Critical] [added: Critical] Accounting Policies and [removed: Estimates][added: Estimates]

[removed: _Revenue] [added: Revenue] from Contracts with [removed: Customers_][added: Customers]

[removed: In accordance with ASC 606,] [added: ,] we recognize revenues, when or as control is transferred to a customer.

[added: | | • |] We account for a contract with a customer when there is written approval, the contract is committed, the rights of the parties, including payment terms, are identified, the contract has commercial substance and consideration is probable of collection. [added: |]

[added: | | • |] We periodically enter into contracts with customers in which a customer may purchase a combination of goods and services, such as products with extended warranty obligations. [added: We determine performance obligations by assessing whether the products or services are distinct from the other elements of the contract. In order to be distinct, the product or service must perform either on its own or with readily available resources and must be separate within the context of the contract. |]

[added: | | • |] We consider the amount stated on the face of the purchase order to be the transaction price. [added: We do not have variable consideration which could impact the stated purchase price agreed to by us and the customer. |]

[added: | | • | Transaction price is allocated to each individual performance obligation based on the standalone selling price of that performance obligation. We use standalone transactions when available to value each performance obligation.] If standalone transactions are not available, we will estimate the standalone selling price through market assessments or cost plus a reasonable margin analysis. [added: Any discounts from standalone selling price are spread proportionally to each performance obligation. |]

[removed: _Translation of] Non-U.S. [removed: Currencies_]

[removed: The functional currency for all non-U.S.] subsidiaries is the U.S. dollar, except for [removed: the Industrial Automation segment] [added: Universal Robots, MiR and Lemsys] for which the local currency is its functional currency.

[removed: All foreign currency denominated non-monetary] assets and liabilities are remeasured into the functional currency using historical exchange rates.

For [removed: Industrial Automation,] [added: Universal Robots, MiR and Lemsys,] assets and liabilities are translated into U.S. dollars using exchange rates in effect at the end of the period.

Translation adjustments are recorded within accumulated other comprehensive income [removed: (loss).][added: (loss) on the balance sheet.]

[removed: _Retirement] [added: Retirement] and Postretirement [removed: Plans_][added: Plans]

[removed: We calculate] the expected return on plan assets using the fair value of the plan assets.

[removed: In March 2017, the Financial Accounting Standards Board (“FASB”) issued ASU 2017-07, _“Compensation—Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost_.”] [added: .”] We retrospectively adopted the new accounting guidance on presentation of net periodic pension costs and net periodic postretirement benefit costs in the first quarter of 2018.

[removed: The non-service] components of net benefit costs such as interest cost, expected return on assets, amortization of prior service cost, and actuarial gains or losses, are required to be reported separately outside of income or loss from operations.

[removed: Following the adoption of this guidance, we continue to record the service cost component in the same line item as other employee compensation costs and the non-service] components of net benefit costs such as interest cost, expected return on assets, amortization of prior service cost, and actuarial gains or losses are reported within other (income) expense, net.

In [removed: 2017 and 2016,] [added: 2017,] the retrospective adoption of this standard decreased income from operations by $5.0 [removed: million and $3.0] million, [removed: respectively,] due to the reclass of net actuarial pension gains and increased [removed: non-operating (income) expense by the same amount with no impact to net income (loss).]

[removed: _Inventories_][added: Inventories]

[removed: _Equity] [added: Equity] Incentive and Stock Purchase [removed: Plans_][added: Plans]

[removed: Stock-based compensation expense is based on the grant-date fair value estimated] in [removed: accordance with] the [removed: provisions of ASC 718, “_Compensation—Stock Compensation._” Upon adoption of ASU 2016-09, _“Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting,”_ in the] first quarter of 2017, we made an accounting policy election to continue accounting for forfeitures by applying an estimated forfeiture rate and recognizing compensation costs only for those stock-based compensation awards expected to vest.

[removed: In accordance with ASU 2016-09,] starting in the first quarter of 2017, excess tax benefits or tax deficiencies are recognized as a discrete tax benefit or discrete tax expense to the current income tax provision in our consolidated statements of operations and are reported as cash flows from operating activities.

In [added: 2019,] 2018 and 2017, we recognized a discrete tax benefit of [added: $4.9 million,] $7.6 million and $6.3 million, respectively, related to net excess tax benefit.

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In 2019, revenue in our test businesses exceeded our plan as a result of Semiconductor Test demand in China, early 5G test investments and strength in our System Test businesses.

The revenue growth of our Industrial Automation businesses was below our plan.

In 2020, we expect continued strong momentum in our test businesses and improvement in the growth of our Industrial Automation businesses.

Energid is included in our Industrial Automation segment.

The remaining maximum contingent consideration that could be paid is $63.2 million.

Based on our December 31, 2019 goodwill impairment test, the MiR reporting unit’s estimated fair value exceeded its carrying value by 14%.

The MiR goodwill amount is $123.6 million as of December 31, 2019.

Key assumptions in the goodwill valuation model are forecasted revenues, discount rate and earnings before interest and taxes.

A change in any of these key assumptions could result in the reporting unit being impaired in a future period.

On January 30, 2019, we acquired all of the issued and outstanding shares of Lemsys SA (“Lemsys”) for a total purchase price of approximately $9.1 million.

Lemsys strengthens our position in the electrification trends of vehicles, solar, wind, and industrial applications.

Lemsys is included in our Semiconductor Test segment.

On June 3, 2019, we invested $15.0 million in RealWear, Inc. (“RealWear”).

RealWear, a private company, develops and sells advanced wearable technology including industrial, hands-free, head-mounted augmented reality devices that make the workplace safer and more productive.

On February 28, 2020, RealWear’s debt holder demanded repayment of its $25.0 million loan to RealWear.

As a result, in the fourth quarter of 2019, we recorded an impairment charge of $15.0 million to reduce our investment in RealWear to zero as of December 31, 2019.

On November 13, 2019, we acquired 100% of the membership interests of AutoGuide, LLC (“AutoGuide”), a maker of high payload AMRs, an emerging and fast growing segment of the global forklift market.

AutoGuide’s AMRs are used for material transport of payloads up to 4,500 kg in manufacturing, warehouse and logistics applications.

These products complement MiR’s lower payload products.

AutoGuide is included in our Industrial Automation segment, which is a key component of our growth strategy.

In accordance with ASC 606, “

Revenue from Contracts with Customers” (“ASC 606”)

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| | • | In order to determine the appropriate timing for revenue recognition, we first determine if the transaction meets any of three criteria for over time recognition. If the transaction meets the criteria for over time recognition, we recognize revenue as the good or service is delivered. We use input variables such as hours or months utilized or costs incurred to determine the amount of revenue to recognize in a given period. Input variables are used as they best align consumption with benefit to the customer. For transactions that do not meet the criteria for over time recognition, we will recognize revenue at a point in time based on an assessment of the five criteria for transfer of control. We have concluded that revenue should be recognized when shipped or delivered based on contractual terms. Typically, acceptance of our products and services is a formality as we deliver similar systems, instruments and robots to standard specifications. In cases where acceptance is not deemed a formality, we will defer revenue recognition until customer acceptance. |

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Translation of

Currencies

The functional currency for all

non-U.S.

All foreign currency denominated

non-monetary

We calculate

In March 2017, the Financial Accounting Standards Board (“FASB”) issued ASU

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During the first quarter of 2018, demand outlook for mobile device test capacity in 2018 declined sharply for our Semiconductor Test business.

Demand in other segments of the Semiconductor Test business, including memory test, increased in 2018.

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In 2015, we acquired Universal Robots A/S (“Universal Robots”), the leading supplier of collaborative robots which are low-cost, easy-to-deploy and simple-to-program robots that work side by side with production workers to improve quality, increase manufacturing efficiency and decrease manufacturing costs.

The acquisition of Universal Robots provides a growth engine to our business.

Contingent consideration for the period from July 2015 to December 2017 was $24.6 million and was paid March 2018.

Contingent consideration for 2018 was $31.0 million and is expected to be paid in March 2019.

We adopted Accounting Standards Codification (“ASC”) 606, “_Revenue from Contracts with Customers”_ on January 1, 2018 using the modified retrospective method for all contracts not completed as of the date of adoption.

The reported results for 2018 reflect the application of ASC 606 while the reported results for 2017 were prepared under the guidance of ASC 605, _“Revenue Recognition,”_ which is also referred to herein as “Legacy GAAP” or the “previous guidance.” We recorded a net increase to retained earnings of $12.7 million as of January 1, 2018 due to the cumulative impact of adopting ASC 606.

The adoption of ASC 606 represents a change in accounting principle that will more closely align revenue recognition with the delivery of Teradyne’s hardware and services and will provide financial statement readers with enhanced disclosures.

In accordance with ASC 606, revenue is recognized when or as a customer obtains control of promised goods or services.

The amount of revenue recognized reflects the consideration to which Teradyne expects to be entitled to receive in exchange for fulfillment of the performance obligation.

Teradyne’s primary source of revenue will continue to be from the sale of systems, instruments, robots, and the delivery of services.

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_Step 1: Identify the contract with the customer_

_Step 2: Identify the performance obligations in the contract_

We determine performance obligations by assessing whether the products or services are distinct from the other elements of the contract.

In order to be distinct, the product or service must perform either on its own or with readily available resources and must be separate within the context of the contract.

_Step 3: Determine the transaction price_

We do not have variable consideration which could impact the stated purchase price agreed to by us and the customer.

_Step 4: Allocate the transaction price to the performance obligations in the contract_

Transaction price is allocated to each individual performance obligation based on the standalone selling price of that performance obligation.

We use standalone transactions when available to value each performance obligation.

Any discounts from standalone selling price are spread proportionally to each performance obligation.

_Step 5: Recognize revenue when (or as) the entity satisfies a performance obligation_

In order to determine the appropriate timing for revenue recognition, we first determine if the transaction meets any of three criteria for over time recognition.

If the transaction meets the criteria for over time recognition, we recognize revenue as the good or service is delivered.

We use input variables such as hours or months utilized or costs incurred to determine the amount of revenue to recognize in a given period.

Input variables are used as they best align consumption with benefit to the customer.

For transactions that do not meet the criteria for over time recognition, we will recognize revenue at a point in time based on an assessment of the five criteria for transfer of control.

We have concluded that revenue should be recognized when shipped or delivered based on contractual terms.

Typically acceptance of our products and services is a formality as we deliver similar systems, instruments and robots to standard specifications.

In cases where acceptance is not deemed a formality, we will defer revenue recognition until customer acceptance.

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Inventories are stated at the lower of cost (first-in, first-out basis) or net realizable value.

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[removed: Concentration] [added: Concentration] of Credit [removed: Risk][added: Risk]

[removed: Our fixed income available-for-sale] marketable securities have a minimum rating of AA by one or more of the major credit rating agencies.

There were no customers who accounted for [removed: more than] 10% [added: or more] of our accounts receivable balance as of December 31, [removed: 2018 and] [added: 2019 or] December 31, [removed: 2017.][added: 2018.]

As of December 31, [removed: 2018,] [added: 2019,] the Notes had a fair value of [removed: $547.1] [added: $1,010] million.

The table below provides a sensitivity analysis of hypothetical 10% changes of Teradyne’s stock price as of the end of [removed: 2018] [added: 2019] and the estimated impact on the fair value of the Notes.

| [removed: Hypothetical] [added: Hypothetical] Change in Teradyne Stock [removed: Price] [added: Price] | | [removed: Fair Value] [added: Fair Value] | | | | [removed: Estimated] [added: Estimated] change in fair [removed: value] [added: value] | | | | [removed: Hypothetical] [added: Hypothetical] percentage increase (decrease) in fair [removed: value] [added: value] | | |

See Note [removed: H:] [added: J:] “Debt” for further information.

[removed: Exchange] [added: Exchange] Rate Risk [removed: Management][added: Management]

As of December 31, [added: 2019,] 2018, [removed: 2017,] and [removed: 2016,] [added: 2017,] the analysis indicated that these hypothetical market movements would not have a material effect on our consolidated financial position, results of operations or cash flows.

[removed: Interest] [added: Interest] Rate Risk [removed: Management][added: Management]

Our interest rate exposure is primarily [removed: in the Netherlands, United States and Singapore] related to short-term and long-term marketable securities.

The potential change in the fair value from changes in interest rates is immaterial as of December 31, [removed: 2018] [added: 2019] and [removed: 2017.][added: 2018.]

Our fixed income

available-for-sale

| 10% Increase | | $ | 1,103,496 | | | $ | 93,221 | | | | 9.2 | % |

| No Change | | | 1,010,275 | | | | — | | | | — | |

| 10% Decrease | | | 918,822 | | | | (91,453 | ) | | | (9.1 | ) |

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| 10% Increase | | $ | 581,716 | | | $ | 34,603 | | | | 6.3 | % |

| No Change | | | 547,113 | | | | — | | | | — | |

| 10% Decrease | | | 514,703 | | | | (32,410 | ) | | | (5.9 | ) |

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| | • | [removed: |] semiconductor test (“Semiconductor Test”) systems; |

| | • | [removed: |] defense/aerospace (“Defense/Aerospace”) test instrumentation and systems, storage test (“Storage Test”) systems, and circuit-board test and inspection (“Production Board Test”) systems (collectively these products represent “System Test”); |

| | • | [removed: |] industrial automation (“Industrial Automation”) products; and |

| | • | [removed: |] wireless test (“Wireless Test”) systems. |

[removed: One customer drives] [added: A few customers drive] significant demand for our products both through direct sales and sales to the customer’s supply partners.

These cyclical periods have had, and will continue to have, a significant effect on our business because our customers often delay or accelerate purchases in reaction to changes in their businesses and to demand fluctuations in the [removed: semiconductor and] [added: semiconductor,] electronics [added: and industrial automation] industries.

[removed: In 2015, we acquired Universal Robots A/S (“Universal Robots”), the leading supplier of collaborative] robots [removed: which are low-cost, easy-to-deploy and simple-to-program robots] that work side by side with production workers to improve quality, increase manufacturing efficiency and decrease manufacturing costs.

The total purchase price [removed: for Universal Robots] was approximately [removed: $315] [added: $197.8] million, which included cash paid of approximately [removed: $284] [added: $145.2] million and [removed: $32] [added: $52.6] million in fair value of contingent consideration payable upon achievement of [added: certain thresholds and targets for] revenue and earnings [removed: targets] [added: before interest and taxes] through [removed: 2018.][added: 2020.]

Contingent consideration for [removed: 2015] [added: 2018] was [removed: $15] [added: $30.8] million and was paid in [removed: February 2016.][added: March 2019.]

Contingent consideration for [removed: the period from July 2015 to December 2018] [added: 2019] was [removed: $3.9] [added: $9.1] million and is expected to be paid in March [removed: 2019.][added: 2020.]

MiR is [removed: the] [added: a] leading maker of collaborative autonomous mobile robots [added: (“AMRs”)] for industrial applications.

The total purchase price was approximately [removed: $198] [added: $81.7] million, which included cash paid of approximately [removed: $145] [added: $57.8] million and [removed: $53] [added: $24.0] million in fair value of contingent consideration payable upon achievement of certain [removed: thresholds and targets for revenue and earnings before interest and taxes] [added: performance targets, extending potentially] through [removed: 2020.][added: 2022.]

[removed: At December 31, 2018, the] [added: The] maximum [removed: amount of] contingent consideration that could be paid is [removed: $115] [added: $106.9] million.

[removed: Universal Robots,] MiR [removed: and Energid are] [added: is] included in our Industrial Automation segment.

[removed: Investor Information][added: Investor Information]

[removed: We make available, free of charge, copies of our filings with the SEC, including our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K] and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act through our web site as soon as reasonably practicable after filing such material electronically or otherwise furnishing it to the SEC.

[removed: Products][added: Products]

[removed: _Semiconductor Test_][added: Semiconductor Test]

These chips are used in automotive, industrial, communications, consumer, [added: smartphones,] and computer and electronic game applications, among others.

[removed: Semiconductor] devices [removed: span a broad range of functionality, from very simple low-cost devices] such as appliance microcontrollers, operational amplifiers or voltage regulators to complex digital signal processors and microprocessors as well as memory devices.

| | • | [removed: |] improve and control product quality; |

| | • | [removed: |] measure and improve product performance; |

| | • | [removed: |] reduce time to market; and |

| | • | [removed: |] increase production yields. |

| | • | [removed: |] A high efficiency multi-site architecture that reduces tester overhead such as instrument setup, synchronization and data movement, and signal processing; |

| | • | [removed: |] The [removed: IG-XL™] [added: IG-XL ™] software operating system which provides fast program development, including instant conversion from single to multi-site test; and |

| | • | [removed: |] Broad technology coverage by instruments designed to cover the range of test parameters, coupled with a universal slot test head design that allows easy test system reconfiguration to address changing test needs. |

FLEX Test Platform purchases are [removed: being] made by IDMs, OSATs, Foundries and Fabless customers.

These markets include [removed: smart phones,] [added: smartphones,] cell phones, tablets, set top boxes, HDTVs, game controllers, computer graphics, and automotive controllers to name a few.

[removed: These end use markets continue to be drivers for the FLEX] Test Platform family of products because they require a wide range of technologies and instrument coverage.

The FLEX Test Platform has an installed base of more than [removed: 6,400] [added: 7,000] systems.

[removed: Our J750™ test system shares the IG-XL] software environment with the family of FLEX Test Platform systems.

[added: We] extended the J750 platform technology to create the IP750 Image [removed: Sensor™ test system.][added: Sensor]

The IP750 is focused on testing image sensor devices used in [removed: smart phones] [added: smartphones] and other imaging products.

The J750 platform has an installed base of over [removed: 5,600] [added: 5,800] systems.

In 2019, we [removed: plan to introduce] [added: introduced] a high-speed DRAM test version of our Magnum platform [added: called Magnum Epic] giving us full product coverage of the memory test market.

The Magnum platform has an installed base of over [removed: 2,600] [added: 2,800] systems.

[removed: Our proprietary SmartPin™] technology enables high efficiency multi-site testing, on an individual test system, permitting greater test throughput.

[removed: The newest products from the platform include the ETS-88,] a high performance multi-site production test system designed to test a wide variety of high volume commodity and precision devices, and the [removed: ETS-800, a high performance multi-site production test system to test high complexity power devices in automotive, industrial and consumer applications.]

The ETS platform has an installed base of over [removed: 4,900] [added: 5,200] systems.

| --- | --- | --- |

| --- | --- | --- |

| --- | --- | --- |

| --- | --- | --- |

In 2019, revenue in our test businesses exceeded our plan as a result of Semiconductor Test demand in China, early 5G test investments and strength in our System Test businesses.

The revenue growth of our Industrial Automation business was below our plan.

In 2020, we expect continued strong momentum in our test businesses and improvement in the growth of our Industrial Automation businesses.

Energid is included in our Industrial Automation segment.

The remaining maximum contingent consideration that could be paid is $63.2 million.

On January 30, 2019, we acquired all of the issued and outstanding shares of Lemsys SA (“Lemsys”) for a total purchase price of approximately $9.1 million.

Lemsys strengthens our position in the electrification trends of vehicles, solar, wind, and industrial applications.

Lemsys is included in our Semiconductor Test segment.

On June 3, 2019, we invested $15.0 million in RealWear, Inc. (“RealWear”).

RealWear, a private company, develops and sells advanced wearable technology including industrial, hands-free, head-mounted augmented reality devices that make the workplace safer and more productive.

On February 28, 2020, RealWear’s debt holder demanded repayment of its $25.0 million loan to RealWear.

As a result, in the fourth quarter of 2019, we recorded an impairment charge of $15.0 million to reduce our investment in RealWear to zero as of December 31, 2019.

On November 13, 2019, we acquired 100% of the membership interests of AutoGuide, LLC (“AutoGuide”), a maker of high payload AMRs, an emerging and fast growing segment of the global forklift market.

AutoGuide’s AMRs are used for material transport of payloads up to 4,500 kg in manufacturing, warehouse and logistics applications.

These products complement MiR’s lower payload products.

AutoGuide is included in our Industrial Automation segment.

We make available, free of charge, copies of our filings with the SEC, including our annual reports on Form

10-K,

quarterly reports on Form

10-Q,

current reports on Form

8-K

Semiconductor devices span a broad range of functionality, from very simple

low-cost

| --- | --- | --- |

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| --- | --- | --- |

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These end use markets continue to be drivers for the FLEX

In 2019, we introduced our next generation UltraFlex

Plus

tester, the newest member of the UltraFlex family, UltraFlex

Plus

| --- | --- |

| --- | --- | --- | --- |

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| --- | --- | --- | --- |

##### [Table of Contents](#toc)

During the first quarter of 2018, demand outlook for mobile device test capacity in 2018 declined sharply for our Semiconductor Test business.

Demand in other segments of the Semiconductor Test business, including memory test, increased in 2018.

The acquisition of Universal Robots provides a growth engine to our business.

Contingent consideration for the period from July 2015 to December 2017 was $24.6 million and was paid in March 2018.

Contingent consideration for 2018 was $31.0 million and is expected to be paid in March 2019.

##### [Table of Contents](#toc)

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The UltraFLEX-M tester extends the FLEX Test Platform into the High Speed DRAM testing market.

We

##### [Table of Contents](#toc)

##### [Table of Contents](#toc)

Universal Robots, which we acquired in June 2015, is the leading supplier of collaborative robots, which are low-cost, easy-to-deploy and simple-to-program robots that work side by side with production workers to improve quality, increase manufacturing efficiency and decrease manufacturing costs.

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##### [Table of Contents](#toc)

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##### [Table of Contents](#toc)

An important component in all wireless systems is the analog RF front end.

The performance of these components is continually pushed higher as device makers add more bands, channels, antennas and higher data rates.

We offer the LitePoint zSeries of modular wireless test instruments for design verification test and production testing of these wireless components.

The lab-in-a-box zSeries solution provides simple and fast design verification of RF power amplifier and smart device RF front end modules.

[removed: 10-K 1 d652525d10k.htm] FORM 10-K

[removed: UNITED STATES][added: UNITED STATES]

[removed: SECURITIES] [added: SECURITIES] AND EXCHANGE [removed: COMMISSION][added: COMMISSION]

[removed: WASHINGTON,] [added: WASHINGTON,] D.C. [removed: 20549][added: 20549]

[removed: FORM 10-K][added: FORM]

[removed: ANNUAL REPORT][added: ANNUAL REPORT]

[removed: PURSUANT] [added: PURSUANT] TO SECTIONS 13 OR [removed: 15(d)][added: 15(d)]

[removed: OF] [added: OF] THE SECURITIES EXCHANGE ACT OF [removed: 1934][added: 1934]

| ☒ | [removed: ANNUAL] [added: ANNUAL] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF [removed: 1934] [added: 1934] |

For the fiscal year ended December 31, [removed: 2018][added: 2019]

| ☐ | [removed: TRANSITION] [added: TRANSITION] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF [removed: 1934] [added: 1934] |

[removed: TERADYNE, INC.][added: TERADYNE, INC.]

[removed: (Exact] [added: (Exact] Name of Registrant as Specified in Its [removed: Charter)][added: Charter)]

| [removed: MASSACHUSETTS] [added: MASSACHUSETTS] | | [removed: 04-2272148] [added: 04-2272148] |

| [removed: (State] [added: (State] or Other Jurisdiction [removed: of Incorporation] [added: of Incorporation] or [removed: Organization)] [added: Organization)] | | [removed: (I.R.S. Employer Identification Number)] [added: (I.R.S. Employer Identification Number)] |

| [removed: 600] [added: 600] RIVERPARK [removed: DRIVE NORTH] [added: DRIVE NORTH] READING, [removed: MASSACHUSETTS] [added: MASSACHUSETTS] | | [removed: 01864] [added: 01864] |

| [removed: (Address] [added: (Address] of Principal Executive [removed: Offices)] [added: Offices)] | | [removed: (Zip Code)] [added: (Zip Code)] |

[removed: Registrant’s] [added: Registrant’s] telephone number, including area code: (978) [removed: 370-2700][added: 370-2700]

[removed: Securities] [added: Securities] registered pursuant to Section 12(b) of the [removed: Act:][added: Act:]

| Common Stock, par value $0.125 per share | | [added: TER | |] Nasdaq Stock Market LLC |

Yes [removed: ☒ No ☐]

Yes [removed: ☐ No ☒]

Yes [removed: ☒ No ☐]

Yes [removed: ☒ No ☐]

[removed: Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐] Smaller reporting company ☐ Emerging growth company [removed: ☐]

Yes [removed: ☐ No ☒]

The aggregate market value of the voting stock held by non-affiliates of the registrant as of June [removed: 29, 2018 was approximately $6.4 billion based upon the closing price of the registrant’s Common Stock on the New York Stock Exchange on that date.][added: 2]

The number of shares outstanding of the registrant’s only class of Common Stock as of February [removed: 25, 2019] [added: 24, 2020] was [removed: 173,629,283] [added: 166,784,497] shares.

[removed: DOCUMENTS] [added: DOCUMENTS] INCORPORATED BY [removed: REFERENCE][added: REFERENCE]

Portions of the registrant’s proxy statement in connection with its [removed: 2019] [added: 2020] annual meeting of shareholders are incorporated by reference into Part III of this Form 10-K.

[removed: TERADYNE, INC.][added: TERADYNE, INC.]

[removed: INDEX][added: INDEX]

| | | | | [removed: Page No.] [added: Page No.] | | |

[removed: | [PART I.](#toc652525_1) | | | | | | [](#toc652525_1) |][added: PART I]

| Item 1. | | [removed: [Business](#toc652525_2)] [added: [Business](#toc860886_2)] | | | 1 | |

| Item 1A. | | [Risk [removed: Factors](#toc652525_3)] [added: Factors](#toc860886_3)] | | | 10 | |

| Item 1B. | | [Unresolved Staff [removed: Comments](#toc652525_4)] [added: Comments](#toc860886_4)] | | | [removed: 20] [added: 21] | |

| Item 2. | | [removed: [Properties](#toc652525_5)] [added: [Properties](#toc860886_5)] | | | 21 | |

| Item 3. | | [Legal [removed: Proceedings](#toc652525_6)] [added: Proceedings](#toc860886_6)] | | | [removed: 21] [added: 22] | |

| Item 4. | | [Mine Safety [removed: Disclosure](#toc652525_7)] [added: Disclosure](#toc860886_7)] | | | [removed: 21] [added: 22] | |

| | | | | |

| --- | --- | --- | --- | --- |

| Title of e ach c lass | | Trading Symbol(s) | | Name of e ach e xchange on w hich r egistered |

| | | | | |

No

No

No

No

Large accelerated filer

Accelerated filer

Non-accelerated

filer

No

, 2019 was approximately $7.3 billion based upon the closing price of the registrant’s Common Stock on the

Nasdaq

Stock

Market

on that date.

| | | [Signatures](#toc860886_26) | | | 117 | |

10-K

This Annual Report on Form

10-K

10-K

and elsewhere, and in other reports we file with the Securities and Exchange Commission.

##### [Table of Contents](#toc)

| | | |

| --- | --- | --- |

| Title of Each Class | | Name of Each Exchange on Which Registered |

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (229.405) is not contained herein, and will not be contained to the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or in any amendment to this Form 10-K.

##### [Table of Contents](#toc)

| | | [Signatures](#toc652525_26) | | | 116 | |

##### [Table of Contents](#toc)

FORM 10-K

##### [Table of Contents](#toc)

Our corporate headquarters is located in North Reading, Massachusetts in buildings that we own consisting of approximately 422,000 square feet.

We conduct manufacturing, engineering, sales and marketing, service, corporate administration and other operations in many locations worldwide.

We own approximately 600,000 square feet and lease over 1,400,000 square feet of office space for these operations.

We believe our existing facilities and planned expansions noted below are adequate to meet our current and reasonably foreseeable requirements.

We regularly evaluate our expected facility needs and periodically makes adjustments based on these evaluations.

During the next two years, we plan to purchase property and build new buildings in Odense, Denmark for our robotics operations and in San Jose, Costa Rica for our service and manufacturing operations.

| --- | --- |

The following table provides information as to our principal facilities:

| | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Location | | Operating Segment | | Major Activity (1) | | | | Approximate Square Feet of Floor Space | | |

| Properties owned: | | | | | | | | | | |

| North Reading, Massachusetts | | Semiconductor Test & System Test | | | 1-2-3-4-5 | | | | 422,000 | |

| Agoura Hills, California | | Semiconductor Test | | | 3-4 | | | | 120,000 | |

| Kumamoto, Japan | | Semiconductor Test | | | 2-3-4-5 | | | | 60,300 | |

| | | | | | | | | | | |

| | | | | | | | | | 602,300 | |

| Properties leased: | | | | | | | | | | |

| Odense, Denmark | | Industrial Automation | | | 2-3-4-5 | | | | 247,000 | |

| Cebu, Philippines | | Semiconductor Test | | | 1-2-5 | | | | 209,000 | |

| San Jose, California | | Semiconductor Test & Wireless Test | | | 2-3-4-5 | | | | 185,700 | |

| Shanghai, China | | Semiconductor Test, System Test, Wireless Test & Industrial Automation | | | 3-4-5 | | | | 103,000 | |

| Buffalo Grove, Illinois | | Semiconductor Test | | | 2-3-4-5 | | | | 95,000 | |

| Sunnyvale, California | | Wireless Test & Semiconductor Test | | | 2-3-4-5 | | | | 71,300 | |

| Heredia, Costa Rica | | Semiconductor Test | | | 1-5 | | | | 63,000 | |

| Hsinchu, Taiwan | | Semiconductor Test & System Test | | | 4 | | | | 43,000 | |

| Seoul, Korea | | Semiconductor Test & Industrial Automation | | | 4 | | | | 34,000 | |

| Singapore, Singapore | | Semiconductor Test & Industrial Automation | | | 1-3-4 | | | | 32,700 | |

| | | | | | | | | | | |

| | | | | | | | | | 1,083,700 | |

| (1) | Major activities have been separated into the following categories: 1. Corporate Administration, 2. Manufacturing, 3. Engineering, 4. Sales and Marketing, 5. Storage and Distribution. |

[removed: PART II][added: PART II]

##### [Table of Contents](#toc)

The following table includes information with respect to repurchases we made of our common stock during the three months ended December 31, [removed: 2018] [added: 2019] (in thousands except per share price):

| [removed: Period] [added: Period] | | [removed: (a) Total Number of Shares (or Units) Purchased] [added: (a) Total Number of Shares (or Units) Purchased] | | | | [removed: (b) Average Price] [added: (b) Average Price] Paid [removed: per Share] [added: per Share] (or [removed: Unit)] [added: Unit)] | | | | [removed: (c)] [added: (c)] Total Number [removed: of Shares] [added: of Shares] (or [removed: Units) Purchased] [added: Units) Purchased] as Part [removed: of Publicly Announced Plans] [added: of Publicly Announced Plans] or [removed: Programs] [added: Programs] | | | | [removed: (d)] [added: (d)] Maximum [removed: Number (or] [added: Number (or] Approximate [removed: Dollar Value)] [added: Dollar Value)] of Shares [removed: (or Units)] [added: (or Units)] that may Yet [removed: Be Purchased] [added: Be Purchased] Under [removed: the Plans] [added: the Plans] or [removed: Programs] [added: Programs] | | |

| (1) | Includes approximately [removed: five] [added: three] thousand shares at an average price of [removed: $36.24] [added: $60.44] withheld from employees for the payment of taxes. |

| September 30, 2019 – October 27, 2019 | | | 757 | | | $ | 59.49 | | | | 756 | | | $ | 262,786 | |

| October 28, 2019 – November 24, 2019 | | | 690 | | | $ | 63.81 | | | | 689 | | | $ | 218,846 | |

| November 25, 2019 – December 31, 2019 | | | 658 | | | $ | 64.38 | | | | 657 | | | $ | 176,522 | |

| | | | 2,105 | (1) | | $ | 62.43 | (1) | | | 2,102 | | | | | |

Before November 27, 2018, our common stock traded on the New York Stock Exchange.

| October 1, 2018 – October 28, 2018 | | | 3,115 | | | $ | 33.87 | | | | 3,113 | | | $ | 832,309 | |

| October 29, 2018 – November 25, 2018 | | | 2,386 | | | $ | 34.54 | | | | 2,383 | | | $ | 750,000 | |

| November 26, 2018 – December 31, 2018 | | | 2,300 | | | $ | 31.95 | | | | 2,300 | | | $ | 676,522 | |

| | | | 7,801 | (1) | | $ | 33.51 | (1) | | | 7,796 | | | | | |

| | | [removed: Years] [added: Years] Ended December [removed: 31,] [added: 31,] | | | | | | | | | | | | | | | | | | |

| | | [removed: 2018] [added: 2019] | | | | [removed: 2017] [added: 2018] | | | | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | |

| | | [removed: (dollars] [added: (dollars] in thousands, except per share [removed: amounts)] [added: amounts)] | | | | | | | | | | | | | | | | | | |

| Revenues | | $ | [removed: 2,100,802] [added: 2,294,965] | | | $ | [removed: 2,136,606] [added: 2,100,802] | | | $ | [removed: 1,753,250] [added: 2,136,606] | | | $ | [removed: 1,639,578] [added: 1,753,250] | | | $ | [removed: 1,647,824] [added: 1,639,578] | |

| Net income (loss) | | $ | [removed: 451,779] [added: 467,468] | | | $ | [removed: 257,692] [added: 451,779] | | | $ | [removed: (43,421] [added: 257,692] | [removed: )] | | $ | [removed: 206,477] [added: (43,421] | [added: )] | | $ | [removed: 81,272] [added: 206,477] | |

| Net income (loss) per common share-basic | | $ | [removed: 2.41] [added: 2.74] | | | $ | [removed: 1.30] [added: 2.41] | | | $ | [removed: (0.21] [added: 1.30] | [removed: )] | | $ | [removed: 0.98] [added: (0.21] | [added: )] | | $ | [removed: 0.40] [added: 0.98] | |

| Net income (loss) per common share-diluted | | $ | [removed: 2.35] [added: 2.60] | | | $ | [removed: 1.28] [added: 2.35] | | | $ | [removed: (0.21] [added: 1.28] | [removed: )] | | $ | [removed: 0.97] [added: (0.21] | [added: )] | | $ | [removed: 0.37] [added: 0.97] | |

| Cash dividend declared per common share | | $ | 0.36 | | | $ | [removed: 0.28] [added: 0.36] | | | $ | [removed: 0.24] [added: 0.28] | | | $ | 0.24 | | | $ | [removed: 0.18] [added: 0.24] | |

| Total assets | | $ | [removed: 2,706,606] [added: 2,787,014] | | | $ | [removed: 3,109,545] [added: 2,706,606] | | | $ | [removed: 2,762,493] [added: 3,109,545] | | | $ | [removed: 2,548,674] [added: 2,762,493] | | | $ | [removed: 2,538,520] [added: 2,548,674] | |

| Long-term debt obligations | | $ | [removed: 379,981] [added: 394,687] | | | $ | [removed: 365,987] [added: 379,981] | | | $ | [removed: 352,669] [added: 365,987] | | | $ | [removed: —] [added: 352,669] | | | $ | — | |

| [removed: (1)] [added: (2)] | The year ended December 31, 2018 includes $49.5 million of tax benefit related to the finalization of the U.S. transition tax liability, $3.3 million of pension actuarial gains, and the results of operations of Mobile Industrial Robots and Energid from April 25, 2018 and February 26, 2018, respectively. |

| [removed: (2)] [added: (3)] | The year ended December 31, 2017 includes $186.0 million of provisional tax expense related to the Tax Reform Act and $6.6 million of pension actuarial gains. |

| [removed: (3)] [added: (4)] | The year ended December 31, 2016 includes a $254.9 million goodwill impairment charge and an $83.3 million acquired intangible assets impairment charge related to the Wireless Test segment, and $3.2 million of pension actuarial gains. |

| [removed: (4)] [added: (5)] | The year ended December 31, 2015 includes $17.7 million of pension actuarial losses, a $5.4 million gain from the sale of an equity investment and the results of operations of Universal Robots from June 12, 2015. |

| (1) | The year ended December 31, 2019 includes a $26.0 million tax benefit from the release of uncertain tax position reserves due to the IRS completion of its audit of our 2015 Federal tax return, a $15.0 million charge for the impairment of the investment in RealWear, $8.2 million of pension actuarial losses, and the results of operations of Lemsys and AutoGuide from January 30, 2019 and November 13, 2019, respectively. |

##### [Table of Contents](#toc)

| (5) | The year ended December 31, 2014 includes a $98.9 million goodwill impairment charge related to the Wireless Test segment and $46.6 million of pension actuarial losses. |

[removed: Report] [added: Report] of Independent Registered Public Accounting [removed: Firm][added: Firm]

To the Board of Directors and Shareholders of Teradyne, [removed: Inc.:][added: Inc.]

[removed: _Opinions] [added: Opinions] on the Financial Statements and Internal Control over Financial [removed: Reporting_][added: Reporting]

We have audited the accompanying consolidated balance sheets of Teradyne, Inc. and its subsidiaries (the “Company”) as of December 31, [removed: 2018] [added: 2019] and [removed: 2017,] [added: 2018,] and the related consolidated statements of operations, comprehensive [removed: income (loss),] [added: income,] shareholders’ equity and cash flows for each of the three years in the period ended December 31, [removed: 2018,] [added: 2019,] including the related notes and schedule of valuation and [removed: qualified] [added: qualifying] accounts for each of the three years in the period ended December 31, [removed: 2018] [added: 2019] appearing under Item 15(c) (collectively referred to as the “consolidated financial statements”).

We also have audited the Company’s internal control over financial reporting as of December 31, [removed: 2018,] [added: 2019,] based on criteria established in [removed: _Internal Control—Integrated Framework_ (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).]

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2018] [added: 2019] and [removed: 2017,] [added: 2018,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2018] [added: 2019] in conformity with accounting principles generally accepted in the United States of America.

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2018,] [added: 2019,] based on criteria established in [removed: _Internal Control—Integrated Framework_ (2013) issued by the COSO.]

As discussed in Note B to the consolidated financial statements, the Company changed the manner in which it accounts for [added: leases in 2019 and the manner in which it accounts for] revenue from contracts with customers in 2018.

[removed: _Basis] [added: Basis] for [removed: Opinions_][added: Opinions]

Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on [removed: the assessed risk.]

[removed: _Definition] [added: Definition] and Limitations of Internal Control over Financial [removed: Reporting_][added: Reporting]

[removed: March 1,] [added: ,] 2019

[removed: TERADYNE, INC.][added: TERADYNE, INC.]

[removed: CONSOLIDATED] [added: CONSOLIDATED] BALANCE [removed: SHEETS][added: SHEETS]

[removed: | | | December 31, | | | | | | |][added: o December 31, 202]

| | | [removed: 2018] [added: 2019] | | | | [removed: 2017] [added: 2018] | | | [added: | 2017 | | |]

| | | [removed: (in] [added: (in] thousands, except per [removed: share information)] [added: share information)] | | | | | | |

| [removed: ASSETS] [added: ASSETS] | | | | | | | | |

| Cash and cash equivalents [added: at beginning of year] | | [removed: $] | 926,752 | | | [removed: $] | 429,843 | | [added: | | 307,884 | |]

| Marketable securities | | | [removed: 190,096] [added: 137,303] | | | | [removed: 1,347,979] [added: 190,096] | |

| Accounts receivable, less allowance for doubtful accounts of [removed: $1,673] [added: $1,736] and [removed: $2,219] [added: $1,673] in [removed: 2018] [added: 2019] and [removed: 2017,] [added: 2018,] respectively | | | [removed: 291,267] [added: 362,368] | | | | [removed: 272,783] [added: 291,267] | |

| Inventories, net | | | [removed: 153,541] [added: 196,691] | | | | [removed: 107,525] [added: 153,541] | |

| Prepayments and other current assets | | | [removed: 170,826] [added: 188,598] | | | | [removed: 112,151] [added: 170,826] | |

| Total current assets | | | [removed: 1,732,482] [added: 1,658,884] | | | | [removed: 2,270,281] [added: 1,732,482] | |

| Property, plant and equipment, net | | | [removed: 279,821] [added: 320,216] | | | | [removed: 268,447] [added: 279,821] | |

| Marketable securities | | | [removed: 87,731] [added: 104,490] | | | | [removed: 125,926] [added: 87,731] | |

| Deferred tax assets | | | [removed: 70,848] [added: 75,185] | | | | [removed: 84,026] [added: 70,848] | |

| Retirement plans assets | | | [removed: 16,883] [added: 18,457] | | | | [removed: 17,491] [added: 16,883] | |

| Other assets | | | [removed: 11,509] [added: 10,332] | | | | [removed: 12,275] [added: 11,509] | |

| Acquired intangible assets, net | | | [removed: 125,482] [added: 125,480] | | | | [removed: 79,088] [added: 125,482] | |

| Goodwill | | | [removed: 381,850] [added: 416,431] | | | | [removed: 252,011] [added: 381,850] | |

| Total assets | | $ | [removed: 2,706,606] [added: 2,787,014] | | | $ | [removed: 3,109,545] [added: 2,706,606] | |

| [removed: LIABILITIES] [added: LIABILITIES] | | | | | | | | |

| Accounts payable | | $ | [removed: 100,688] [added: 126,617] | | | $ | [removed: 86,393] [added: 100,688] | |

| Accrued employees’ compensation and withholdings | | | [removed: 148,566] [added: 163,883] | | | | [removed: 141,694] [added: 148,566] | |

| Deferred revenue and customer advances | | | [removed: 77,711] [added: 104,876] | | | | [removed: 83,614] [added: 77,711] | |

| Other accrued liabilities | | | [removed: 78,272] [added: 70,871] | | | | [removed: 59,083] [added: 78,272] | |

| Contingent consideration | | | [removed: 34,865] [added: 9,106] | | | | [removed: 24,497] [added: 34,865] | |

| Income taxes payable | | | [removed: 36,185] [added: 44,200] | | | | [removed: 59,055] [added: 36,185] | |

| Total current liabilities | | | [removed: 476,287] [added: 539,029] | | | | [removed: 454,336] [added: 476,287] | |

Internal Control - Integrated Framework

(2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Internal Control - Integrated Framework

(2013) issued by the COSO.

Changes in Accounting Principles

the assessed risk.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Acquisition of AutoGuide, LLC - Valuation of Contingent Consideration and Developed Technology Intangible Asset

As described in Notes B, D and H to the consolidated financial statements, the Company completed its acquisition of AutoGuide, LLC on November 13, 2019.

The total purchase price of approximately $81.7 million included $57.8 million of cash paid and $24.0 million in fair value of contingent consideration, which was determined by management using the Monte Carlo simulation model.

As part of the preliminary purchase price allocation, management recorded $24.6 million for the acquired developed technology intangible asset at fair value using the income approach.

Management’s significant assumption utilized in the approach was the forecasted revenues.

The principal considerations for our determination that performing procedures relating to the valuation of contingent consideration and the acquired developed technology intangible asset in the AutoGuide, LLC acquisition is a critical audit matter are (i) there was a high degree of auditor judgment and subjectivity in applying procedures relating to the fair value measurement of the contingent consideration and the acquired developed technology intangible asset due to the significant amount of judgment by management when developing the fair value estimates, (ii) significant audit effort was required in evaluating the significant assumptions relating to the estimates, including forecasted revenues, revenue volatility, earnings before interest and taxes, and discount rate for the contingent consideration, and the forecasted revenues for the acquired developed technology intangible asset, and (iii) the audit effort involved the use of professionals with specialized skill and knowledge to assist in performing procedures and evaluating the audit evidence obtained.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to the acquisition accounting, including controls over management’s valuation of contingent consideration and the acquired developed technology intangible asset.

These procedures also included, among others, (i) reading the purchase agreement, (ii) evaluating the appropriateness of the approaches and reasonableness of the significant assumptions used by management in developing the fair value for the contingent consideration and acquired developed technology intangible asset, including the forecasted revenues, revenue volatility, earnings before interest and taxes, and discount rate for the contingent consideration and the forecasted revenues for the acquired developed technology intangible asset, and (iii) testing the completeness, accuracy and relevance of the underlying data used in the approaches.

Evaluating whether the significant assumptions used were reasonable involved evaluating historical results and consistency with external industry and market data.

Professionals with specialized skill and knowledge were used to assist in the evaluation of the appropriateness of management’s Monte Carlo simulation model for the contingent consideration and the income approach for the acquired developed technology intangible asset, as well as the reasonableness of certain significant assumptions, including the discount rate.

Goodwill Impairment Assessment – Mobile Industrial Robots Reporting Unit

As described in Notes B and L to the consolidated financial statements, the Company’s consolidated goodwill balance was $416.4 million as of December 31, 2019, and the goodwill associated with the Mobile Industrial Robots reporting unit was $123.6 million.

Management assesses goodwill for impairment at least annually in the fourth quarter, as of December 31, on a reporting unit basis, or more frequently when events and circumstances occur indicating that the recorded goodwill may be impaired.

As disclosed by management, if the book value of a reporting unit exceeds its fair value, the implied fair value of goodwill is compared with the carrying amount of goodwill.

If the carrying amount of goodwill exceeds the implied fair value of goodwill, an impairment charge is recorded in an amount equal to that excess.

Management determines the fair value of a reporting unit using the results derived from an income approach and a market approach, and weighting the fair value determined under each approach to determine an estimated fair value for a reporting unit.

Management’s estimate of fair value for the Mobile Industrial Robots reporting unit, using the income approach, utilized the following significant assumptions: forecasted revenues, discount rate and earnings before interest and taxes.

The determination of fair value of the Mobile Industrial Robots reporting unit using the market approach utilized the following significant assumptions: revenue multiples from comparable companies.

The principal considerations for our determination that performing procedures relating to the goodwill impairment assessment of the Mobile Industrial Robots reporting unit is a critical audit matter are (i) there was a high degree of auditor judgment and subjectivity in applying procedures relating to the fair value measurement of the reporting unit due to the significant judgment by management when developing the fair value measurement of the reporting unit, (ii) significant audit effort was required in performing procedures and evaluating the audit evidence obtained relating to management’s fair value estimate and significant assumptions, including forecasted revenues, discount rate, and earnings before interest and taxes for the income approach and revenue multiples from comparable companies for the market approach, and (iii) the audit effort involved the use of professionals with specialized skill and knowledge to assist in performing these procedures and evaluating the audit evidence obtained.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s goodwill impairment assessment, including controls over the valuation of the Mobile Industrial Robots reporting unit.

These procedures also included, among others, testing management’s process for developing the fair value estimate, evaluating the appropriateness of the income approach and market approach, including the weighting of estimated fair value between the two approaches, testing the completeness, accuracy and relevance of underlying data used in the valuation approaches and evaluating the significant assumptions used by management, including forecasted revenues, discount rate,

earnings before interest and taxes, and revenue multiples from comparable companies.

Evaluating management’s assumptions related to the forecasted revenues and earnings before interest and taxes involved assessing whether the assumptions used by management were reasonable considering the past performance of the reporting unit and the consistency of the assumptions with evidence obtained in other areas of the audit.

Evaluating the market approach involved assessing whether the revenue multiples used by management were reasonable by comparing to revenue multiples for comparable companies.

Professionals with specialized skill and knowledge were used to assist in the evaluation of the Company’s income approach and market approach, including the weighting of estimated fair value between the two approaches and certain significant assumptions, including the discount rate.

March 2, 2020

| Operating lease right-of-use assets, net | | | 57,539 | | | | — | |

| Operating lease liabilities | | | 19,476 | | | | — | |

| Long-term operating lease liabilities | | | 45,849 | | | | — | |

_Change in Accounting Principle_

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| Long-term debt | | | 379,981 | | | | 365,987 | |

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| Goodwill impairment | | | — | | | | — | | | | 254,946 | |

| Acquired intangible assets impairment | | | — | | | | — | | | | 83,339 | |

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| Prior service benefit arising during period, net of tax of $0, $0, $34, respectively | | | — | | | | — | | | | 59 | |

| | | | (245 | ) | | | (272 | ) | | | (262 | ) |

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| Balance, December 31, 2015 | | | 203,641 | | | $ | 25,455 | | | $ | 1,480,647 | | | $ | (8,144 | ) | | $ | 467,828 | | | $ | 1,965,786 | |

| Issuance of stock to employees under benefit plans, net of shares withheld for payroll tax of $9,398 | | | 2,377 | | | | 297 | | | | 10,368 | | | | | | | | | | | | 10,665 | |

| Equity component of convertible debt | | | | | | | | | | | 100,836 | | | | | | | | | | | | 100,836 | |

| Equity component of convertible notes issuance cost | | | | | | | | | | | (2,017 | ) | | | | | | | | | | | (2,017 | ) |

| Purchase of convertible notes hedges | | | | | | | | | | | (100,834 | ) | | | | | | | | | | | (100,834 | ) |

| Proceeds from issuance of warrants | | | | | | | | | | | 67,852 | | | | | | | | | | | | 67,852 | |

| Repurchase of common stock | | | (6,841 | ) | | | (855 | ) | | | | | | | | | | | (145,476 | ) | | | (146,331 | ) |

| Cash dividends | | | | | | | | | | | | | | | | | | | (48,639 | ) | | | (48,639 | ) |

| Net loss | | | | | | | | | | | | | | | | | | | (43,421 | ) | | | (43,421 | ) |

| Unrealized gains on marketable securities, net of tax of $923 | | | | | | | | | | | | | | | 2,037 | | | | | | | | 2,037 | |

| Less: reclassification adjustment for gains included in net income, net of tax $(255) | | | | | | | | | | | | | | | (683 | ) | | | | | | | (683 | ) |

| Prior service income arising during period, net of tax of $34 | | | | | | | | | | | | | | | 59 | | | | | | | | 59 | |

| Cumulative effect adjustment for prior year tax benefits related to stock options and restricted stock units | | | | | | | | | | | | | | | | | | | 39,081 | | | | 39,081 | |

[removed: Disclosure] [added: Disclosure] Controls and [removed: Procedures][added: Procedures]

As of the end of the period covered by this report, our management, with the participation of our CEO and CFO, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule [removed: 13a-15(b) promulgated under the Exchange Act.]

[removed: Changes] [added: Changes] in Internal Control over Financial [removed: Reporting][added: Reporting]

There was no change in our internal control over financial reporting during the fourth fiscal quarter ended December 31, [removed: 2018] [added: 2019] that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

[removed: Management’s] [added: Management’s] Annual Report on Internal Control over Financial [removed: Reporting][added: Reporting]

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule [removed: 13a-15(f).]

Under the supervision and with the participation of our management, including our CEO and CFO, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in [removed: _Internal Control—Integrated Framework_ (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.]

[removed: Based on our evaluation under the framework in _Internal Control—Integrated Framework (2013)_,] [added: ,] our management concluded that our internal control over financial reporting was effective as of December 31, [removed: 2018.][added: 2019.]

The effectiveness of our internal control over financial reporting as of December 31, [removed: 2018] [added: 2019] has been audited by PricewaterhouseCoopers LLP, our independent registered public accounting firm, as stated in their report which is included under Item 8 of this Annual Report.

[removed: Inherent] [added: Inherent] Limitations on Effectiveness of [removed: Controls][added: Controls]

[removed: Also, projections of any evaluation of effectiveness to future periods are subject to the risk that] controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

13a-15(b)

promulgated under the Exchange Act.

13a-15(f).

Internal Control—Integrated Framework

(2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on our evaluation under the framework in

Internal Control—Integrated Framework (2013)

Also, projections of any evaluation of effectiveness to future periods are subject to the risk that

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[removed: PART III][added: PART III]

##### [Table of Contents](#toc)

Certain information relating to our directors and executive officers, committee information, reports and charters, executive compensation, security ownership of certain beneficial owners and management and related stockholder matters, and certain relationships and related transactions is incorporated by reference herein from our definitive proxy statement in connection with our Annual Meeting of Shareholders to be held on May [removed: 7, 2019.][added: 8, 2020.]

Certain information relating to our directors and executive officers, executive compensation, security ownership of certain beneficial owners and management and related stockholder matters, and certain relationships and related transactions is incorporated by reference herein from our definitive proxy statement in connection with our Annual Meeting of Shareholders to be held on May [removed: 7, 2019.][added: 8, 2020.]

Certain information relating to our directors and executive officers, executive compensation, security ownership of certain beneficial owners and management and related stockholder matters, and certain relationships and related transactions is incorporated by reference herein from our definitive proxy statement in connection with our Annual Meeting of Shareholders to be held May [removed: 7, 2019.][added: 8, 2020.]

Certain information relating to our directors and executive officers, executive compensation, security ownership of certain beneficial owners and management and related stockholder matters, and certain relationships and related transactions is incorporated by reference herein from our definitive proxy statement in connection with our Annual Meeting of Shareholders to be held on May [removed: 7, 2019.][added: 8, 2020.]

Certain information relating to audit fees and other of Teradyne’s independent registered public accounting firm is incorporated by reference herein from our definitive proxy statement in connection with our Annual Meeting of Shareholders to be held on May [removed: 7, 2019.][added: 8, 2020.]

[removed: PART IV][added: PART IV]

##### [Table of Contents](#toc)

[removed: 15(a)(1)] [added: 15(a)(1)] Financial [removed: Statements][added: Statements]

| | | [removed: Page] [added: Page] | | |

| [Report of Independent Registered Public Accounting [removed: Firm](#tx652525_50)] [added: Firm](#fin860886_1)] | | | [removed: 44] [added: 42] | |

| [Consolidated Balance Sheets as of December 31, [removed: 2018] [added: 2019] and [removed: 2017](#tx652525_51)] [added: 2018](#fin860886_2)] | | | 46 | |

| [Consolidated Statements of Operations for the years ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016](#tx652525_52)] [added: 2017](#fin860886_3)] | | | 47 | |

| [Consolidated Statements of Comprehensive Income [removed: (Loss)] for the years ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016](#tx652525_53)] [added: 2017](#fin860886_4)] | | | 48 | |

| [Consolidated Statements of Shareholders’ Equity for the years ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016](#tx652525_54)] [added: 2017](#fin860886_5)] | | | 49 | |

| [Consolidated Statements of Cash Flows for the years ended December 31, [removed: 2018, 2017] [added: 2019, 2018] and [removed: 2016](#tx652525_55)] [added: 2017](#fin860886_6)] | | | 50 | |

[removed: 15(a)(2)] [added: 15(a)(2)] Financial Statement [removed: Schedule][added: Schedule]

[removed: 15(a)(3)] [added: 15(a)(3)] Listing of [removed: Exhibits][added: Exhibits]

[removed: 15(c)] [added: 15(c)] Financial Statement [removed: Schedules][added: Schedules]

[removed: TERADYNE, INC.][added: TERADYNE, INC.]

[removed: SCHEDULE] [added: SCHEDULE] II—VALUATION AND QUALIFYING [removed: ACCOUNTS][added: ACCOUNTS]

| [removed: Column A] [added: Column A] | | [removed: Column B] [added: Column B] | | | | [removed: Column C] [added: Column C] | | | | [removed: Column D] [added: Column D] | | | | [removed: Column E] [added: Column E] | | | | [removed: Column F] [added: Column F] | | |

| [removed: Description] [added: Description] | | [removed: Balance at Beginning] [added: Balance at Beginning] of [removed: Period] [added: Period] | | | | [removed: Additions Charged to Cost] [added: Additions Charged to Cost] and [removed: Expenses] [added: Expenses] | | | | [removed: Other] [added: Other] | | | | [removed: Deductions] [added: Deductions] | | | | [removed: Balance at End] [added: Balance at End] of [removed: Period] [added: Period] | | |

| | | [removed: (in thousands)] [added: (in thousands)] | | | | | | | | | | | | | | | | | | |

| 2018 Allowance for doubtful [removed: accounts] [added: account] | | $ | 2,219 | | | $ | — | | | $ | 20 | | | $ | 566 | | | $ | 1,673 | |

| [removed: Column A] [added: Column A] | | [removed: Column B] [added: Column B] | | | | [removed: Column C] [added: Column C] | | | | [removed: Column D] [added: Column D] | | | | [removed: Column E] [added: Column E] | | | | [removed: Column F] [added: Column F] | | |

| [removed: Description] [added: Description] | | [removed: Balance at Beginning] [added: Balance at Beginning] of [removed: Period] [added: Period] | | | | [removed: Additions Charged to Cost] [added: Additions Charged to Cost] and [removed: Expenses] [added: Expenses] | | | | [removed: Other] [added: Other] | | | | [removed: Deductions] [added: Deductions] | | | | [removed: Balance at End] [added: Balance at End] of [removed: Period] [added: Period] | | |

| | | [removed: (in thousands)] [added: (in thousands)] | | | | | | | | | | | | | | | | | | |

| [removed: Column A] [added: Column A] | | [removed: Column B] [added: Column B] | | | | [removed: Column C] [added: Column C] | | | | [removed: Column D] [added: Column D] | | | | [removed: Column E] [added: Column E] | | | | [removed: Column F] [added: Column F] | | |

| [removed: Description] [added: Description] | | [removed: Balance at Beginning] [added: Balance at Beginning] of [removed: Period] [added: Period] | | | | [removed: Additions Charged to Cost] [added: Additions Charged to Cost] and [removed: Expenses] [added: Expenses] | | | | [removed: Other] [added: Other] | | | | [removed: Deductions] [added: Deductions] | | | | [removed: Balance at End] [added: Balance at End] of [removed: Period] [added: Period] | | |

| | | [removed: (in thousands)] [added: (in thousands)] | | | | | | | | | | | | | | | | | | |

| 2019 Allowance for doubtful account | | $ | 1,673 | | | $ | 87 | | | $ | 28 | | | $ | 52 | | | $ | 1,736 | |

| 2019 Inventory reserve | | $ | 100,779 | | | $ | 15,244 | | | $ | (85 | ) | | $ | 12,382 | | | $ | 103,556 | |

| 2019 Valuation allowance | | $ | 69,852 | | | $ | 7,325 | | | $ | — | | | $ | — | | | $ | 77,177 | |

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| 2016 Allowance for doubtful accounts | | $ | 2,407 | | | $ | — | | | $ | — | | | $ | 51 | | | $ | 2,356 | |

| 2016 Inventory reserve | | $ | 119,376 | | | $ | 17,493 | | | $ | 4,417 | | | $ | 25,270 | | | $ | 116,016 | |

| 2016 Valuation allowance | | $ | 43,039 | | | $ | 5,413 | | | $ | — | | | $ | 83 | | | $ | 48,369 | |

[removed: EXHIBIT INDEX][added: EXHIBIT INDEX]

| [removed: Exhibit No.] [added: Exhibit No.] | | [removed: Description] | | [removed: SEC] [added: Description | | SEC] Document [removed: Reference] [added: Reference] |

| [added: |] 2.1 | | [added: |] Share Sale and Purchase Agreement [removed: by] [added: to] and among Teradyne [added: Robotics] Holdings Denmark ApS, [removed: Teradyne] [added: Teradyne,] Inc. and the shareholders of [removed: Universal] [added: Mobile Industrial] Robots [removed: A/S] [added: ApS] dated [removed: May 13, 2015.] [added: April 25, 2018.] | | [Exhibit 2.1 to Teradyne’s Quarterly Report on Form 10-Q for the quarter ended [removed: July 5, 2015.](http://www.sec.gov/Archives/edgar/data/97210/000119312515291444/d941133dex21.htm)] [added: April 1, 2018.](http://www.sec.gov/Archives/edgar/data/97210/000119312518160479/d503232dex21.htm)] |

| [added: |] 2.2 | | [added: | Amendment No. 1 dated as of October 10, 2019 to] Share Sale and Purchase Agreement [removed: to] [added: by] and among Teradyne Robotics Holdings Denmark ApS, Teradyne, Inc. and the [added: former] shareholders of Mobile Industrial Robots [removed: ApS dated April 25, 2018.] [added: ApS.] | | [removed: [Exhibit 2.1 to Teradyne’s Quarterly Report on Form 10-Q for the quarter ended April 1, 2018.](http://www.sec.gov/Archives/edgar/data/97210/000119312518160479/d503232dex21.htm)] [added: [Filed herewith.](https://www.sec.gov/Archives/edgar/data/97210/000119312520058676/d860886dex22.htm)] |

| [removed: 3.1] | [added: 21.1] | [removed: Restated Articles] [added: | | Subsidiaries] of [removed: Organization.] [added: Teradyne.] | | [Filed [removed: herewith.](https://www.sec.gov/Archives/edgar/data/97210/000119312519059974/d652525dex31.htm)] [added: herewith.](https://www.sec.gov/Archives/edgar/data/97210/000119312520058676/d860886dex211.htm)] |

| [added: |] 3.2 | | [added: |] Amended and Restated By-laws, as amended. | | [Exhibit 3.1 to Teradyne’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.](http://www.sec.gov/Archives/edgar/data/97210/000119312507241999/dex31.htm) |

| [added: |] 4.1 | | [added: |] Indenture dated as of December 12, 2016, between Teradyne [removed: Inc] [added: Inc.] and Wilmington Trust, National Association, as [removed: trustee] [added: trustee.] | | [Exhibit 4.1 to Teradyne’s Current Report on Form 8-K filed on December 12, 2016.](http://www.sec.gov/Archives/edgar/data/97210/000119312516790822/d298959dex41.htm) |

| [added: |] 10.1† | | [added: |] Standard Manufacturing Agreement entered into as of November 24, 2003 by and between Teradyne and Solectron. | | [Exhibit 10.1 to Teradyne’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2007.](http://www.sec.gov/Archives/edgar/data/97210/000119312507241999/dex101.htm) |

| [added: |] 10.2† | | [added: | Second] Amendment [removed: 1] to Standard Manufacturing Agreement, dated as of [removed: January 18,] [added: August 27,] 2007, by and between Teradyne and Solectron. | | [Exhibit [removed: 10.2] [added: 10.3] to Teradyne’s Quarterly Report on Form 10-Q for the quarter ended September 30, [removed: 2007.](http://www.sec.gov/Archives/edgar/data/97210/000119312507241999/dex102.htm)] [added: 2007.](http://www.sec.gov/Archives/edgar/data/97210/000119312507241999/dex103.htm)] |

| [removed: 10.3†] | [added: 10.28] | [removed: Second Amendment to Standard Manufacturing Agreement,] [added: | | Employment Agreement] dated [removed: as of August 27, 2007, by and] [added: September 1, 2014] between [removed: Teradyne] [added: Teradyne, Inc.] and [removed: Solectron.] [added: Bradford Robbins.*] | | [Exhibit [removed: 10.3] [added: 10.2] to Teradyne’s Quarterly Report on Form 10-Q for the quarter ended September [removed: 30, 2007.](http://www.sec.gov/Archives/edgar/data/97210/000119312507241999/dex103.htm)] [added: 28, 2014.](http://www.sec.gov/Archives/edgar/data/97210/000119312514402724/d785774dex102.htm)] |

| [removed: 10.4] | [added: 10.3†] | [removed: Fifth] [added: | | Sixth] Amendment to Standard Manufacturing Agreement, dated as of July [removed: 17,] [added: 27,] 2009, by and between Teradyne and Flextronics Corporation. | | [Exhibit [removed: 10.4] [added: 10.5] to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, [removed: 2009.](http://www.sec.gov/Archives/edgar/data/97210/000119312510044865/dex104.htm)] [added: 2009.](http://www.sec.gov/Archives/edgar/data/97210/000119312510044865/dex105.htm)] |

| [removed: 10.5†] | [added: 10.5] | [removed: Sixth] [added: | | Eighth] Amendment to Standard Manufacturing Agreement, dated as of [removed: July 27, 2009,] [added: April 13, 2012,] by and between Teradyne and Flextronics [removed: Corporation.] [added: Sales & Marketing North Asia (L) LTD.] | | [Exhibit [removed: 10.5] [added: 10.7] to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, [removed: 2009.](http://www.sec.gov/Archives/edgar/data/97210/000119312510044865/dex105.htm)] [added: 2012.](http://www.sec.gov/Archives/edgar/data/97210/000119312513087821/d440736dex107.htm)] |

| [removed: 10.6] | [added: 10.4] | [added: | |] Addendum to Standard Manufacturing Agreement (Authorized Purchase Agreement)—Revised July 1, 2010. | | [Exhibit 10.6 to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, 2010.](http://www.sec.gov/Archives/edgar/data/97210/000119312511051703/dex106.htm) |

| [removed: 10.7] | [added: 10.6†] | [removed: Eighth] [added: | | Ninth] Amendment to Standard Manufacturing Agreement, dated as of [removed: April 13,] [added: September 17,] 2012, by and between Teradyne and Flextronics Sales & Marketing North Asia (L) LTD. | | [Exhibit [removed: 10.7] [added: 10.8] to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, [removed: 2012.](http://www.sec.gov/Archives/edgar/data/97210/000119312513087821/d440736dex107.htm)] [added: 2012.](http://www.sec.gov/Archives/edgar/data/97210/000119312513087821/d440736dex108.htm)] |

| [removed: Exhibit No.] [added: Exhibit No.] | | [removed: Description] | | [removed: SEC] [added: Description | | SEC] Document [removed: Reference] [added: Reference] |

| [removed: 10.8†] | [added: 10.26] | [removed: Ninth Amendment to Standard Manufacturing Agreement,] [added: | | Employment Agreement] dated [removed: as of September 17, 2012, by and] [added: February 6, 2013] between Teradyne and [removed: Flextronics Sales & Marketing North Asia (L) LTD.] [added: Walter G. Vahey.*] | | [Exhibit [removed: 10.8] [added: 10.33] to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, [removed: 2012.](http://www.sec.gov/Archives/edgar/data/97210/000119312513087821/d440736dex108.htm)] [added: 2012.](http://www.sec.gov/Archives/edgar/data/97210/000119312513087821/d440736dex1033.htm)] |

| [removed: 10.9] | [added: 10.7] | [added: | |] 2006 Equity and Cash Compensation Incentive Plan, as amended.* | | [removed: [Filed herewith.](https://www.sec.gov/Archives/edgar/data/97210/000119312519059974/d652525dex109.htm)] [added: [Exhibit 10.9 to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018.](http://www.sec.gov/Archives/edgar/data/97210/000119312519059974/d652525dex109.htm)] |

| [removed: 10.10] | [added: 10.8] | [added: | |] Danish Sub-Plan to the 2006 Equity and Cash Compensation Incentive Plan. | | [removed: [Filed herewith.](https://www.sec.gov/Archives/edgar/data/97210/000119312519059974/d652525dex1010.htm)] [added: [Exhibit 10.10 to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018.](http://www.sec.gov/Archives/edgar/data/97210/000119312519059974/d652525dex1010.htm)] |

| [removed: 10.11] | [added: 10.9] | [added: | |] Form of Performance-Based Restricted Stock Unit Agreement for Executive Officers under 2006 Equity and Cash Compensation Incentive Plan.* | | [Exhibit 10.10 to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017.](http://www.sec.gov/Archives/edgar/data/97210/000119312518066579/d504255dex1010.htm) |

| [removed: 10.12] | [added: 10.10] | [added: | |] Form of Time-Based Restricted Stock Unit Agreement for Executive Officers under 2006 Equity and Cash Compensation Incentive Plan.* | | [Exhibit 10.11 to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017.](http://www.sec.gov/Archives/edgar/data/97210/000119312518066579/d504255dex1011.htm) |

| [removed: 10.13] | [added: 10.11] | [added: | |] Form of Executive Officer Stock Option Agreement under 2006 Equity and Cash Compensation Incentive Plan, as amended.* | | [Exhibit 10.15 to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, 2017.](http://www.sec.gov/Archives/edgar/data/97210/000119312518066579/d504255dex1015.htm) |

| [removed: 10.14] | [added: 10.12] | [added: | |] Form of Restricted Stock Unit Agreement for Directors under 2006 Equity and Cash Compensation Incentive Plan.* | | [Exhibit 10.12 to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016.](http://www.sec.gov/Archives/edgar/data/97210/000119312517064638/d274101dex1012.htm) |

| [added: |] 10.15 | | [added: | Danish Sub-Plan to the] 1996 Employee Stock Purchase [removed: Plan, as amended.*] [added: Plan.] | | [Filed [removed: herewith.](https://www.sec.gov/Archives/edgar/data/97210/000119312519059974/d652525dex1015.htm)] [added: herewith.](https://www.sec.gov/Archives/edgar/data/97210/000119312520058676/d860886dex1015.htm)] |

| [removed: 10.16] | [added: 10.13] | [removed: Sub-Plan to the] [added: | |] 1996 Employee Stock Purchase [removed: Plan for participants located in the European Union /European Economic Area.] [added: Plan, as amended.*] | | [Exhibit [removed: 10.14] [added: 10.15] to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, [removed: 2017.](http://www.sec.gov/Archives/edgar/data/97210/000119312518066579/d504255dex1014.htm)] [added: 2018.](http://www.sec.gov/Archives/edgar/data/97210/000119312519059974/d652525dex1015.htm)] |

| [removed: 10.17] | [added: 10.16] | [added: | |] Deferral Plan for Non-Employee Directors, as amended.* | | [Exhibit 10.2 to Teradyne’s Quarterly Report on form 10-Q for the quarter ended September 28, 2008.](http://www.sec.gov/Archives/edgar/data/97210/000119312508229977/dex102.htm) |

| [removed: 10.18] | [added: 10.17] | [added: | |] Supplemental Savings Plan, as amended and restated.* | | [Exhibit 10.18 to Teradyne’s Annual Report on Form 10-K for the fiscal year ended December 31, 2008.](http://www.sec.gov/Archives/edgar/data/97210/000119312509042745/dex1018.htm) |