Semiconductor Equipment & Robotics Star Stocks Hit New Highs After Earnings Report, Outperforming Expectations

On a turbulent Tuesday in the U.S. stock market, the star semiconductor testing equipment and robotics stock Teradyne defied the trend, rising 11% to hit a new all-time high. The company’s latest earnings report showed impressive growth, demonstrating how testing equipment businesses are riding the wave of AI.

(Source: TradingView)

As background, Teradyne sells automatic test equipment to semiconductor and electronic device manufacturers and also produces advanced robotic systems, including collaborative robots and mobile robots to support manufacturing and warehousing operations.

In its earnings released after the market close the previous day, Teradyne’s fourth-quarter net profit reached $257.2 million, with a net earnings of $1.63 per share; compared to $146.3 million and $0.90 per share in the same period last year. Adjusted earnings per share were $1.80, far exceeding analysts’ consensus estimate of $1.38.

Quarterly revenue also increased 44% to $1.08 billion, surpassing analysts’ expectations of $970 million.

The company attributes the growth to AI-driven demand in the semiconductor testing business, particularly in computing, networking, and storage, and expects demand in the computing sector to continue this year, with all business segments expected to grow.

At the earnings presentation, CEO Greg Smith stated that AI drove over 60% of the company’s revenue in the fourth quarter, and this proportion is expected to rise to 70% in the current quarter.

(Source: Earnings PPT)

For the current fiscal quarter, Teradyne expects revenue between $1.15 billion and $1.25 billion, significantly higher than analysts’ forecast of $939 million; adjusted earnings per share are expected to be between $1.89 and $2.25, crushing analysts’ expectations of $1.29.

With such data, the sharp rally on Tuesday was naturally expected.

Cantor Fitzgerald analyst C.J. Muse wrote in a recent report: “We were already very optimistic about this company before this earnings report, but… wow.”

Muse noted that driven by AI demand, Teradyne showed strong momentum across all business lines in the fourth quarter, and expects this momentum to continue into the current quarter. He specifically pointed out that the semiconductor testing business remains the company’s core focus, accounting for about 82% of total revenue, with strong AI-driven demand covering areas such as networking, computing, and storage applications.

(Source: Cailian Press)