Teradyne Inc (NYSE:TER) shares jumped more than 12% on Tuesday after the semiconductor test equipment maker posted fourth-quarter results that significantly exceeded Wall Street expectations, driven by strong demand linked to artificial intelligence (AI).
The company reported adjusted earnings per share of $1.80, topping analysts’ estimate of $1.36, while revenue rose 44% from a year earlier to $1.083 billion, above the $969 million forecast. Revenue from semiconductor test equipment, Teradyne’s largest business, reached $883 million, also surpassing estimates.
CEO Greg Smith attributed the results to “AI-related demand in compute, networking and memory within our Semi Test business.”
Teradyne projected first-quarter revenue of $1.15 billion to $1.25 billion and adjusted EPS of $1.89 to $2.25, both well above analysts’ expectations.
Full-year 2025 revenue climbed 13% to $3.19 billion. The company also declared a quarterly cash dividend of $0.12 per share and repurchased $183.4 million of common stock in the quarter. Teradyne ended the year with $293.8 million in cash and cash equivalents and $200 million in short-term debt.
“In 2026, we expect year-over-year growth across all of our businesses, with strong momentum in compute driven by AI,” Smith said.
Teradyne’s product test and robotics businesses contributed $110 million and $89 million in Q4 revenue, respectively. Net cash provided by operating activities for the quarter totaled $281.6 million.