How does Teradyne (TER) make money?

Teradyne (TER) generates revenue primarily from Product, which accounted for 86.7% of total revenue in TTM through Q2 2026. The company reported $4.46B in revenue and converted 25.8% of it into net profit, equivalent to roughly $1.15B in net income — what's left after the cost of revenue, operating expenses, interest, and income taxes.

What is the gross profit margin of Teradyne (TER)?

Teradyne (TER) reported a gross profit margin of 59.3% in TTM through Q2 2026, equivalent to $2.65B in gross profit on $4.46B in revenue. Gross margin measures how much of each dollar of revenue remains after the direct cost of producing or delivering the product — a higher figure typically signals pricing power, scale, or a less capital-intensive business model.

What is the operating profit margin of Teradyne (TER)?

Teradyne (TER) reported an operating profit margin of 30.6% in TTM through Q2 2026, equivalent to $1.37B in operating income. Operating margin captures profitability after research & development, sales & marketing, and general & administrative expenses — but before interest, taxes, and one-off items — and is the cleanest single read on the underlying business's efficiency.

What is the net profit margin of Teradyne (TER)?

Teradyne (TER) reported a net profit margin of 25.8% in TTM through Q2 2026, equivalent to $1.15B in net income. Net margin is the bottom-line share of revenue that survives every expense — operating costs, interest, and income taxes — and is the figure that flows directly into earnings per share.

Is Teradyne (TER) profitable?

Yes. Teradyne (TER) reported $1.15B in net income for TTM through Q2 2026, with a net profit margin of 25.8%. The company earned more from its operations than it paid out in costs, interest, and income taxes, leaving positive earnings on the bottom line.

How much does Teradyne (TER) invest in research and development?

Teradyne (TER) invested $560M in research and development during TTM through Q2 2026, roughly 12.5% of total revenue. R&D spending funds the company's future product pipeline and is expensed in full on the income statement rather than capitalised, which makes the operating margin sensitive to how aggressively management chooses to reinvest in innovation.

How much does Teradyne (TER) spend on capital expenditures?

Teradyne (TER) spent $90.9B on capital expenditures (CapEx) during TTM through Q2 2026, roughly 2035.8% of total revenue. CapEx represents long-lived investment in property, equipment, data centres, and other physical infrastructure, and is subtracted from operating cash flow to arrive at free cash flow.

How much free cash flow does Teradyne (TER) generate?

Teradyne (TER) generated $507B in free cash flow during TTM through Q2 2026, a free-cash-flow margin of 11354.0%. Free cash flow is the cash left after capital expenditures and represents the discretionary pool the company can use to pay dividends, repurchase shares, repay debt, or fund acquisitions without raising external capital.

What is the effective tax rate of Teradyne (TER)?

Teradyne (TER) had an effective tax rate of 13.6% in TTM through Q2 2026. The effective rate is the actual share of pre-tax income paid as income taxes and can differ materially from the statutory rate due to foreign earnings mix, tax credits (such as R&D), share-based compensation deductions, and one-off discrete items.

What are the main business segments of Teradyne (TER)?

Teradyne (TER) reports revenue across 2 reportable product segments, led by Product at 86.7% of total revenue in TTM through Q2 2026. See the revenue-by-segment table on this page for the full breakdown and how each segment feeds into the income-statement waterfall above.

How Teradyne Makes Money: 2026 Visual Revenue Map

Teradyne (TER) Income Statement Flow — TTM through Q2 2026

Calculated from the four most recent reported quarters, ending June 28, 2026 (reported July 29, 2026).

Teradyne discloses geographic revenue only in annual filings. to view the full breakdown.

Teradyne (TER) Revenue by Product Segment — TTM through Q2 2026

Aggregated from the four quarterly disclosures behind this TTM. Minor differences vs the company's annual filing can occur if reported segments changed mid-year.

Revenue contribution by product segment for Teradyne (TER), TTM through Q2 2026.
Segment	Revenue (USD)	% of total
Product	$3.87B	86.7%
Service	$593M	13.3%
Total	$4.46B	100%

Product$3.87B
Service$593M
Total$4.46B

Revenue Breakdown — TTM through Q2 2026

In TTM through Q2 2026, Teradyne (TER) reports revenue across 2 reportable product segments; the largest segment was Product at 86.7%, followed by Service (13.3%).

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