Teradyne reports results on Tuesday 27 October, after the market closes. Growth is speeding up: revenue over the twelve months to Q2 2026 was $4.5 billion, which rose 57.9% on the year before.
Source: reported quarterly EPS and aggregated third-party estimates. Historical surprises are context, not a forecast.
View chart data
| Period | Reported EPS | Analysts' estimate |
|---|---|---|
| Sep '25 | $0.85 | $0.79 |
| Dec '25 | $1.80 | $1.38 |
| Mar '26 | $2.56 | $2.12 |
| Jun '26 | $2.47 | $2.05 |
What analysts expect
Analysts have been raising their forecasts going into the report. For the quarter, the average EPS estimate stands at $2.05, in a range from $1.99 to $2.20, while the average revenue estimate is $1.3 billion. The full-year picture shows an average EPS estimate of $9.10, which would be up 129.7% on last year (based on 15 analysts). That estimate has risen 24.5% over the past 90 days. Of the analysts’ recommendations, 12 are positive, 5 neutral and 0 negative.
Company guidance
In its latest earnings release, management set third quarter of 2026 GAAP net income attributable to Teradyne per diluted share guidance at $1.79 to $2.09. In its latest earnings release, management set third quarter of 2026 non-GAAP net income attributable to Teradyne per diluted share guidance at $1.85 to $2.15. Alongside that, in its latest earnings release, management set third quarter of 2026 revenue guidance at $1.2 billion to $1.3 billion.
Earnings surprise model
The model estimates EPS could land above the analysts’ average estimate by 10.3%. Its estimated chance of an EPS beat is 75.0%, based on the last 4 quarters. The model shrinks the median recent surprise toward zero and uses a neutral prior for beat frequency; this small sample is a reference estimate, not company guidance.
Track record against estimates
The company reported EPS above the analysts’ average estimate in 4 of the last 4 quarters. Last quarter, EPS of $2.47 compared with an estimate of $2.05, above it by 20.3%.
The trends going in
The business is getting more profitable as it grows. That growth rate was up 27.5 percentage points on the rate a quarter earlier. The trailing gross margin was 59.2%, while the trailing operating margin was 30.2%, up 11.9 percentage points from a year earlier. The trailing net margin was 25.8%. Net income over the twelve months was $1.2 billion, which rose 145.2% on the year before.
The cash picture
Profit and cash are telling different stories: earnings grew far faster. Operating cash flow over the twelve months was $1.1 billion, up 34.4% on the year before. Capital spending was $265.0 million, or 5.9% of revenue. Free cash flow, operating cash flow less capital spending, was $799.9 million, up 40.6% on the year before. Free cash flow was 17.9% of revenue (the free-cash-flow margin), down 2.2 percentage points from a year earlier. The average diluted share count fell 2.7% over the year.
Against its own history
Set against the company’s own record: today’s free-cash-flow margin of 17.9% is higher than 43% of the company’s own past quarterly readings, which have ranged from 10.5% to 31.3%. Today’s operating margin of 30.2% is higher than 91% of past readings (−7.6% to 32.9%). Today’s twelve-month revenue growth rate of 57.9% is higher than 98% of past readings (−18.4% to 66.4%).
Questions this report will answer
Whether the pick-up in revenue growth continues. Whether results land above or below the analysts’ expectations set out above. Alongside that, whether margins hold at the trailing levels above. The next filing will show whether the trends above continue, slow or reverse.
What it means for value
For valuation, the figures matter through our model. In our model, growth 5 percentage points lower would lower the value by 23.7%, and 5 percentage points higher would raise it by 30.2%. A free-cash-flow margin 1 percentage point lower would lower it by 5.5%.
