Investor Relations | Teradyne Inc.

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SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

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FORM 10-Q

----------(MARK ONE)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED JULY 2, 2000

OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM __________ TO ______________

COMMISSION FILE NO. 1-6462

TERADYNE, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)

MASSACHUSETTS 04-2272148 (STATE OR OTHER JURISDICTION (I.R.S.EMPLOYER INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)

321 HARRISON AVENUE, BOSTON, MASSACHUSETTS 02118 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)

617-482-2700 (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)

Indicate by check mark whether the registrant: (1) has filed all reportsrequired to be filed by Section 13 or 15(d) of the Securities Exchange Act of1934 during the preceding 12 months (or for such shorter period that theregistrant was required to file such reports), and (2) has been subject to thefiling requirements for the past 90 days. Yes X No --- ---

The number of shares outstanding of the registrant's only class of CommonStock as of July 28, 2000 was 173,441,376 shares.

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TERADYNE, INC. INDEX

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PART I. FINANCIAL INFORMATION

Item 1. Financial Statements:

Condensed Consolidated Balance Sheets as of July 2, 2000 and December 31, 1999............................3

Condensed Consolidated Statements of Income for the Three and Six Months Ended July 2, 2000 and July 4, 1999......4

Condensed Consolidated Statements of Cash Flows for the Six Months Ended July 2, 2000 and July 4, 1999................5

Notes to Condensed Consolidated Financial Statements..............6-9

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations...............10-13

Item 3. Quantitative and Qualitative Disclosures about Market Risk.........13

PART II. OTHER INFORMATION

Item 1. Legal Proceedings..................................................13

Item 4. Submission of Matters to a Vote of Security Holders...............13

Item 6. Exhibits and Reports on Form 8-K..................................13

Exhibit Index..............................................................15

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TERADYNE, INC. CONDENSED CONSOLIDATED BALANCE SHEETS

ASSETS JULY 2, 2000 DECEMBER 31, 1999 ------------ ----------------- (UNAUDITED) (IN THOUSANDS) Current assets: Cash and cash equivalents ................................................ $ 163,247 $ 181,345 Marketable securities .................................................... 133,764 66,316 Accounts receivable ...................................................... 485,911 296,159 Inventories: Parts .............................................................. 223,486 123,300 Assemblies in process .............................................. 188,243 145,393 ----------- ----------- 411,729 268,693 Deferred tax assets ...................................................... 49,716 49,716 Prepayments and other current assets ..................................... 36,383 45,458 ----------- ----------- Total current assets ............................................... 1,280,750 907,687Property, plant, and equipment, at cost: .................................... 1,065,971 981,986 Less: accumulated depreciation ........................................ (477,677) (484,247) ----------- ----------- Net property, plant, and equipment ................................. 588,294 497,739Marketable securities ....................................................... 136,814 139,752Other assets ................................................................ 26,578 23,035 ----------- ----------- Total assets ....................................................... $ 2,032,436 $ 1,568,213 =========== ===========

LIABILITIESCurrent liabilities: Notes payable - banks .................................................... $ 8,089 $ 8,221

Current portion of long-term debt ........................................ 4,595 4,659 Accounts payable ......................................................... 186,670 104,335 Accrued employees' compensation and withholdings ......................... 140,971 117,314 Unearned service revenue and customer advances ........................... 78,752 60,096 Other accrued liabilities ................................................ 87,965 66,223 Income taxes payable ..................................................... 11,577 31,478 ----------- ----------- Total current liabilities .......................................... 518,619 392,326Deferred tax liabilities .................................................... 13,907 13,907Long-term debt .............................................................. 8,729 8,948 ----------- ----------- Total liabilities .................................................. 541,255 415,181 ----------- -----------

SHAREHOLDERS' EQUITY

Common stock, $0.125 par value, 1,000,000 and 250,000 shares authorized, 173,406 and 170,319 net shares issued and outstanding at July 2, 2000 and December 31, 1999, respectively ...................... 21,676 21,290Additional paid-in capital .................................................. 325,256 234,198Retained earnings ........................................................... 1,144,249 897,544 ----------- -----------

Total shareholders' equity ......................................... 1,491,181 1,153,032 ----------- ----------- Total liabilities and shareholders' equity ......................... $ 2,032,436 $ 1,568,213 =========== ===========

The accompanying notes, together with the Notes to Consolidated FinancialStatements included in the Company's Annual Report on Form 10-K for the yearended December 31, 1999 are an integral part of the condensed consolidatedfinancial statements.

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TERADYNE, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

FOR THE THREE MONTHS ENDED FOR THE SIX MONTHS ENDED -------------------------------- -------------------------------- JULY 2, 2000 JULY 4, 1999 JULY 2, 2000 JULY 4, 1999 ------------- ------------ ------------ ------------ (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) Net sales ...................................... $ 758,955 $ 400,904 $ 1,407,086 $ 745,358

Expenses: Cost of sales ............................. 402,570 236,940 751,410 456,798 Engineering and development ............... 73,637 56,829 142,662 104,553 Selling and administrative ................ 91,982 59,386 170,938 113,867 ----------- ----------- ----------- ----------- 568,189 353,155 1,065,010 675,218 ----------- ----------- ----------- -----------

Income from operations ......................... 190,766 47,749 342,076 70,140

Other income (expense): Interest income ............................ 6,235 3,842 11,197 7,620 Interest expense ........................... (412) (442) (837) (904) ----------- ----------- ----------- -----------

Income before income taxes ..................... 196,589 51,149 352,436 76,856

Provision for income taxes ..................... 58,977 15,345 105,731 23,057 ----------- ----------- ----------- -----------

Net income ..................................... $ 137,612 $ 35,804 $ 246,705 $ 53,799 =========== =========== =========== ===========

Net income per common share - basic ............ $ 0.79 $ 0.21 $ 1.43 $ 0.32 =========== =========== =========== ===========

Net income per common share - diluted .......... $ 0.76 $ 0.20 $ 1.36 $ 0.30 =========== =========== =========== ===========

Shares used in calculations of net income per common share - basic ................... 173,158 170,245 172,643 170,138 =========== =========== =========== ===========Shares used in calculations of net income per common share - diluted ................. 181,697 178,061 181,285 178,028 =========== =========== =========== =====================================================================================================================================


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TERADYNE, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

FOR THE SIX MONTHS ENDED ------------------------------ JULY 2, 2000 JULY 4, 1999 ------------ ------------ (IN THOUSANDS) Cash flows from operating activities: Net income .................................................................... $ 246,705 $ 53,799 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation ............................................................... 51,003 43,536 Amortization ............................................................... 804 554 Other non-cash items, net .................................................. 951 713 Changes in operating assets and liabilities: Accounts receivable ................................................... (189,752) (65,510) Inventories ........................................................... (143,036) 9,190 Other assets .......................................................... 4,728 (17,330) Accounts payable and accruals ......................................... 146,391 80,707 Income taxes payable .................................................. 66,732 18,670 --------- ---------

Net cash provided by operating activities ......................... 184,526 124,329 --------- ---------

Cash flows from investing activities: Additions to property, plant and equipment .................................... (116,346) (51,678) Increase in equipment manufactured by the Company ............................. (26,488) (6,570) Purchases of available-for-sale marketable securities ......................... (200,462) (32,437) Maturities of available-for-sale marketable securities ........................ 194,790 27,626 Purchases of held-to-maturity marketable securities ........................... (118,325) (88,503) Maturities of held-to-maturity marketable securities .......................... 59,487 -- --------- ---------

Net cash used for investing activities ................................ (207,344) (151,562) --------- ---------

Cash flows from financing activities: Payments of long term debt .................................................... (91) (951) Acquisition of treasury stock ................................................. (46,293) (65,389) Issuance of common stock under employee stock option and stock purchase plans ........................................... 51,104 51,344 --------- ---------

Net cash flows provided by (used for) financing activities ........ 4,720 (14,996) --------- ---------

Decrease in cash and cash equivalents .............................................. (18,098) (42,229)Cash and cash equivalents at beginning of period ................................... 181,345 185,514 --------- ---------Cash and cash equivalents at end of period ......................................... $ 163,247 $ 143,285 ========= =========

Supplementary disclosure of cash flow information: Cash paid during the period for: Interest ............................................................ $ 809 $ 951 Income taxes ........................................................ 19,192 4,910


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TERADYNE, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

A. THE COMPANY

Teradyne, Inc. (the "Company") designs, manufactures, markets, and servicestest systems and related software, and backplanes and associated connectors. TheCompany has five principal products; semiconductor test systems, backplaneconnection systems, circuit-board test systems, telecommunications test systems,and software test systems.

Semiconductor test systems are used by electronic component manufacturersin the design and testing of their products. Backplane connection systems areused principally for the computer, communications, and military/aerospaceindustries. A backplane is an assembly into which printed circuit boards areinserted that provides for the interconnection of electrical signals between thecircuit boards and the other elements of the system. Circuit-board test systemsare used by electronic equipment manufacturers for the design and testing of

circuit boards and other assemblies. Telecommunication test systems are used bytelephone operating companies for the testing and maintenance of theirsubscriber telephone lines and related equipment. Software test systems are usedby a number of industries to test communications networks, computerizedtelecommunication systems, and web based applications.

B. ACCOUNTING POLICIES

Basis of Presentation

The condensed consolidated interim financial statements include theaccounts of the Company and its subsidiaries. All significant intercompanybalances and transactions have been eliminated. The year-end condensedconsolidated balance sheet data were derived from audited financial statements,but do not include all disclosures required by generally accepted accountingprinciples.

Preparation of Financial Statements

The accompanying condensed consolidated interim financial statements areunaudited. However, in the opinion of management, all adjustments (consistingonly of normal recurring accrual entries) necessary for a fair statement of theresults for the interim periods have been made. The preparation of financialstatements in conformity with generally accepted accounting principles requiresmanagement to make estimates and assumptions that affect the reported amounts ofassets and liabilities and disclosure of contingent assets and liabilities atthe dates of the financial statements and the reported amounts of revenues andexpenses during the reported periods. Actual results could differ from thoseestimates.

Revenue Recognition

Product revenue is recognized upon shipment. The Company's products aregenerally subject to warranty, and the Company provides for such estimated costswhen product revenue is recognized. The Company recognizes service revenue asthe services are provided or ratably over the period of the related contract, asapplicable. The Company unbundles service revenue from product sales andmaintenance services from software license fees based upon amounts charged whensuch elements are separately sold. For certain contracts eligible under AmericanInstitute of Certified Public Accountants ("AICPA") Statement of Position No.81-1, revenue is recognized using the percentage-of-completion accounting methodbased upon an efforts-expended method. In all cases, changes to total estimatedcosts and anticipated losses, if any, are recognized in the period in whichdetermined.

Other Comprehensive Income

Comprehensive income does not materially differ from net income for thethree and six month periods ended July 2, 2000 and July 4, 1999.

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TERADYNE, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

C. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In June 1999, the Financial Accounting Standards Board issued SFAS No. 137,"Accounting for Derivative Instruments and Hedging Activities - Deferral of theEffective Date of FASB Statement No. 133." SFAS No. 137 amends SFAS No. 133,"Accounting for Derivative Instruments and Hedging Activities" which was issuedin June 1998 and was to be effective for all fiscal quarters of fiscal yearsbeginning after June 15, 1999. SFAS No. 137 defers the effective date of SFASNo. 133 to the first quarter of all fiscal years beginning after June 15, 2000.Accordingly, the Company will adopt the provisions of SFAS No. 133 for its 2001fiscal year. SFAS No. 133 requires that all derivative instruments be recordedon the balance sheet at their fair value. Changes in the fair value ofderivatives are recorded each period in current earnings or other comprehensiveincome, depending on whether a derivative is designated as part of a hedge

transaction and the type of hedge transaction. In June 2000, the FinancialAccounting Standards Board ("FASB") issued Statement of Financial AccountingStandards ("SFAS") No.138 "Accounting for Certain Derivative Instruments andHedging Activities - an amendment of FASB Statement No.133." SFAS No.138 amendsthe accounting and reporting standards of SFAS No.133 for certain derivativeinstruments and certain hedging activities. SFAS No.138 will be adoptedconcurrently with SFAS No.133. Management is currently evaluating the effects ofthis change on its recording of derivatives and hedging activities.

On June 26, 2000, the Securities and Exchange Commission ("SEC") issuedStaff Accounting Bulletin ("SAB") No. 101B which amended Question 2 of Section Bof Topic 13 of the Staff Accounting Bulletin Series. SAB No. 101B delays theimplementation date of SAB No. 101 "Revenue Recognition in Financial Statements"until the Company's fourth quarter of the fiscal year 2000. SAB No. 101summarizes the SEC's view in applying generally accepted accounting principlesto selected revenue recognition issues. The effects of applying the guidance inSAB No. 101, if any, will be reported as the cumulative effect adjustmentresulting from a change in accounting principle. The Company has not completedits evaluation of SAB 101 and is therefore unable to determine the impact theSAB will have on its financial statements.

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TERADYNE, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (UNAUDITED)

D. NET INCOME PER COMMON SHARE

The following table sets forth the computation of basic and diluted netincome per common share (in thousands, except per share amounts):

For the Three Months Ended For the Six Months Ended ----------------------------- --------------------------- July 2, 2000 July 4, 1999 July 2, 2000 July 4, 1999 ------------ ------------ ------------ ------------ Net Income ................................................ $137,612 $ 35,804 $246,705 $ 53,799 ======== ======== ======== ========

Shares used in net income per common share - basic ........ 173,158 170,245 172,643 170,138 Effect of dilutive securities: Employee and director stock options .............. 8,265 7,431 8,468 7,629 Employee stock purchase rights ................... 274 385 174 261 -------- -------- -------- -------- Dilutive potential common shares ..................... 8,539 7,816 8,642 7,890 -------- -------- -------- --------Shares used in net income per common share - diluted ...... 181,697 178,061 181,285 178,028 ======== ======== ======== ========

Net income per common share - basic ....................... $ 0.79 $ 0.21 $ 1.43 $ 0.32 ======== ======== ======== ========

Net income per common share - diluted ..................... $ 0.76 $ 0.20 $ 1.36 $ 0.30 ======== ======== ======== ========

For purposes of computing diluted earnings per share, weighted average commonshare equivalents do not include stock options with an exercise price thatexceeds the average fair market value of the Company's common stock during thethree and six month periods presented above. Options to purchase 68,300 and89,134 shares of common stock during the three months ended July 2, 2000 andJuly 4,1999 and 49,362 and 70,394 shares during the six months ended July 2,2000 and July 4, 1999 were outstanding during the periods then ended. Theseoptions were not included in the calculation of diluted net income per commonshare because the options' exercise price was greater than the average marketprice of the common shares during those periods.

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TERADYNE, INC. NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONCLUDED (UNAUDITED)

E. OPERATING SEGMENT INFORMATION

The Company has five principal operating segments which are the design,manufacturing and marketing of semiconductor test systems, backplane connectionsystems, circuit-board test systems, telecommunication test systems, andsoftware test systems. These operating segments were determined based upon thenature of the products and services offered. The Company has three reportablesegments; semiconductor test systems segment, backplane connection systemssegment, and other. The other segment is comprised of circuit-board testsystems, telecommunication test systems, and software test systems.

The Company evaluates performance based on several factors, of which theprimary financial measure is business segment income before taxes. Theaccounting policies of the business segments are the same as those described in"Note B: Accounting Policies" in the Company's Annual Report on Form 10-K forthe year ended December 31, 1999. Intersegment sales are accounted for at fairvalue as if sales were to third parties. Operating segment information for thethree and six month periods ended July 2, 2000 and July 4, 1999 follows (inthousands):

Sales to Sales to Unaffiliated Intersegment Net Income (Loss) Unaffiliated Intersegment Net Income (Loss)Reportable Segments Customers Sales Sales Before Taxes Customers Sales Sales Before Taxes------------------- --------- ------------ ----- ------------ ------------ ------------ ----- ------------

Three months ended July 2, 2000: Three months ended July 4, 1999: -------------------------------- -------------------------------- Semiconductor Test Systems $ 534,350 $ -- $ 534,350 $ 193,427 $ 263,263 $ -- $ 263,263 $ 51,962Backplane Connection Systems 169,668 8,249 177,917 38,313 86,530 4,766 91,296 14,716Other 54,937 -- 54,937 (4,000) 51,111 -- 51,111 (4,806)Corporate and Eliminations -- (8,249) (8,249) (31,151) -- (4,766) (4,766) (10,723) --------------------------------------------------- -----------------------------------------------Consolidated $ 758,955 $ -- $ 758,955 $ 196,589 $ 400,904 $ -- $ 400,904 $ 51,149 =================================================== ===============================================

Six months ended July 2, 2000: Six months ended July 4, 1999: ------------------------------ ------------------------------

Semiconductor Test Systems $ 990,853 $ -- $ 990,853 $ 345,122 $ 461,429 $ -- $ 461,429 $ 70,984Backplane Connection Systems 302,310 13,666 315,976 64,977 176,091 6,004 182,095 29,202Other 113,923 -- 113,923 (2,075) 107,838 -- 107,838 (3,613)Corporate and Eliminations -- (13,666) (13,666) (55,588) -- (6,004) (6,004) (19,717) -------------------------------------------------- -----------------------------------------------Consolidated $1,407,086 $ -- $1,407,086 $ 352,436 $ 745,358 $ -- $ 745,358 $ 76,856 =================================================== ===============================================

(1) Income before taxes of the principal businesses exclude the effects of employee profit sharing, management incentive compensation, other unallocated expenses, and net interest income.

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ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

SELECTED RELATIONSHIPS WITHIN THE CONDENSED CONSOLIDATED STATEMENTS OF INCOME

FOR THE THREE MONTHS ENDED FOR THE SIX MONTHS ENDED --------------------------------- ---------------------------------- JULY 2, 2000 JULY 4, 1999 JULY 2, 2000 JULY 4, 1999 ------------ ------------ ------------ ------------ (IN THOUSANDS) (IN THOUSANDS)

Net sales ............................................. $ 758,955 $ 400,904 $ 1,407,086 $ 745,358 =========== =========== =========== ===========

Net income ............................................ $ 137,612 $ 35,804 $ 246,705 $ 53,799 =========== =========== =========== ===========

Percentage of net sales: Net sales ........................................ 100% 100% 100% 100% Expenses: Cost of sales ................................ 53 59 54 62 Engineering and development .................. 10 14 10 14 Selling and administrative ................... 12 15 12 15 Interest, net ................................ (1) (1) (1) (1) ----------- ----------- ----------- ----------- 74 87 75 90

Income before income taxes ....................... 26 13 25 10 Provision for income taxes ....................... 8 4 7 3 ----------- ----------- ----------- ----------- Net income ....................................... 18% 9% 18% 7% =========== =========== =========== ===========Provision for income taxes as a percentage of income before taxes ..................................... 30% 30% 30% 30% =========== =========== =========== ===========

RESULTS OF OPERATIONS

The Company recorded record sales of $759.0 million in the second quarterof 2000, an increase of $358.1 million or 89% from the second quarter of 1999.Semiconductor test systems sales increased 103% from the second quarter of 1999due to increased orders resulting from capacity expansion by semiconductormanufacturers and subcontractors. Sales of backplane connection systems tounaffiliated customers increased 96% from the second quarter of 1999 as a resultof continued growth in demand from networking, data storage, and other hightechnology customers. Other test systems sales increased 7% from the secondquarter of 1999. The Company recorded sales of $1.41 billion in the first sixmonths of 2000, an increase of $661.7 million or 89% over the first six monthsof 1999. Semiconductor test systems sales and backplane connection systems salesto unaffiliated customers increased 115% and 72%, respectively, when compared tothe first six months of 1999. Other test systems sales for the first 6 months of2000 increased 6% over the corresponding period in 1999. Income before taxes inthe second quarter of 2000 increased $145.4 million from the second quarter of1999 to $196.6 million. For the first six months of 2000, income before taxesincreased $275.6 million to $352.4 million when compared to the first six monthsof 1999.

Incoming orders were $826.4 million in the second quarter of 2000 comparedto $571.0 million in the second quarter of 1999. The increase in incoming orderswas led by a 168% increase in backplane connection systems orders and a 20%increase in semiconductor test systems orders. For the six month periods endedJuly 2, 2000 and July 4, 1999, incoming orders were $1,850.6 million and$1,015.1 million, respectively. The increase in incoming orders was led by a143% increase in backplane connection systems orders and a 73% increase insemiconductor test systems orders. The Company's backlog was $1,423.0 million atthe end of the second quarter of 2000 compared with $849.5 million at the end ofthe second quarter of 1999.

Cost of sales decreased from 59% of sales in the second quarter of 1999 to53% of sales in the second quarter of 2000 and from 62% in the first six monthsof 1999 to 54% in the first six months of 2000. These percentage decreases wereprimarily attributable to increased utilization of the Company's manufacturingoverhead, as sales volume increased while certain components of cost of salesremained fixed.

Engineering and development expenses, as a percentage of sales, decreasedfrom 14% in the second quarter and first six months of 1999 to 10% in the secondquarter and first six months of 2000, while increasing by $16.8 million and$38.1 million, respectively. This spending growth was primarily due to increasedinvestments in new products in each operating segment.

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Selling and administrative expenses, as a percentage of sales, decreased

from 15% in the second quarter and first six months of 1999 to 12% in the secondquarter and first six months of 2000, while increasing by $32.6 million and$57.1 million, respectively. This spending growth was due to higher compensationrelated expenses and spending in support of increased semiconductor testsystems, software test systems, and backplane connection systems sales.

Interest income increased by $2.4 million to $6.2 million in the secondquarter of 2000 compared to the second quarter of 1999 and by $3.6 million to$11.2 million in the first six months of 2000 compared to the first six monthsof 1999. These increases are attributable to increases in the Company's averageinvested balances.

The Company's overall effective tax rate was 30% in the second quarter of2000 and the first six months of 2000. The overall effective tax rate for theyear ended 1999 was also 30%. The Company utilized export sales corporationbenefits and certain research and development tax credits to operate below theU.S. statutory rate of 35%.

LIQUIDITY AND CAPITAL RESOURCES

The Company's cash, cash equivalents and marketable securities balanceincreased $46.4 million in the first six months of 2000, to $433.8 million. TheCompany generated cash from operating activities of $184.5 million in the firstsix months of 2000 and $124.3 million in the six months of 1999. Cash generatedfrom net income, excluding the effects of non-cash items, was $299.5 million and$98.6 million for the first six months of 2000 and 1999, respectively. Changesin operating assets and liabilities used cash of $115.0 million in the first sixmonths of 2000 as a result of increases in working capital to support increasedsales. In the first six months of 1999, changes in operating assets andliabilities provided cash of $25.7 million.

The Company used $207.3 million of cash for investing activities in thefirst six months of 2000 and $151.6 million in the first six months of 1999.Investing activities consist of purchases, sales, and maturities of marketablesecurities and purchases of capital assets to support long-term growth. Capitalexpenditures were $142.8 million in the first six months of 2000 and $58.2million in the first six months of 1999.

Financing activities provided $4.7 million of cash during the first sixmonths of 2000. The Company used $15.0 million of cash for financing activitiesin the first six months of 1999. Financing activities include issuance of theCompany's common stock through employee stock option and stock purchase plans,repurchase of common stock through a stock buyback program and repayments ofdebt. During the first six months of 2000, net common stock activity providedcash of $4.8 million. During the first six months of 1999, net common stockactivity used cash of $14.0 million. Since 1996, the Company has used $439.6million of cash to repurchase 16.9 million shares of its common stock on theopen market.

The Company believes its cash, cash equivalents, and marketable securitiesbalance of $433.8 million, together with other sources of funds, including cashflow generated from operations and the available borrowing capacity of $120.0million under its line of credit agreement, will be sufficient to meet workingcapital and capital expenditure requirements for the foreseeable future.

Inflation has not had a significant long-term impact on earnings.

CERTAIN FACTORS THAT MAY AFFECT FUTURE RESULTS

From time to time, information provided by the Company, statements made byits employees or information included in its filings with the Securities andExchange Commission (including this Form 10-Q and the Company's Annual Report toShareholders) contains statements that are not purely historical, so-called"forward looking statements," which involve risks and uncertainties. Inparticular, forward looking statements may include projections, plans, andobjectives for the Company's business, financial condition, operating results,future operations, future economic performance or statements relating to thesufficiency of capital to meet working capital and planned capital expenditures.The Company's actual future results may differ materially from those stated inany forward looking statements. Factors that may cause such differences include,but are not limited to, the factors discussed below. These factors, and others,are discussed from time to time in the Company's filings with the Securities andExchange Commission, including in the Company's Annual Report on Form 10-K forthe year ended December 31, 1999.

The Company's future results are subject to substantial risks anduncertainties. The Company's business and results of operations depend insignificant part upon capital expenditures of manufacturers of semiconductors,which in turn depend upon the current and anticipated market demand forsemiconductors and products incorporating semiconductors. The semiconductorindustry has been highly cyclical with recurring periods of over supply, whichoften have had a severe effect on the semiconductor industry's demand for testequipment, including systems manufactured and marketed by the Company. TheCompany believes that the markets for newer generations of semiconductors alsowill be subject to similar fluctuations. There can be no assurance that anyincrease in semiconductor test systems bookings for a particular calendarquarter will be sustained in subsequent quarters. Any factor adversely affectingthe semiconductor industry or particular segments within the semiconductorindustry may adversely affect the Company's business, financial condition andoperating results. In addition, the Company believes many of its semiconductortest systems customers place orders in anticipation of manufacturing theirproducts. If these customers manufacture fewer products than expected,

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they may attempt to cancel their semiconductor test systems orders with theCompany. These cancellations could have a material adverse effect on theCompany's financial condition in future quarters. Finally, the Company has madesubstantial investments in fixed-cost infrastructure. If the semiconductorindustry experiences a downturn, the Company may have difficulty reducingexpenses in a timely manner, which could have a material adverse effect on itsprofitability.

The Company recently has experienced record order backlog. If the Company isunable to timely manufacture products to fill these orders and meet customerexpectations, customers may cancel existing orders or fail to place new ordersin the future, which would have an adverse effect on the Company's revenues andresults of operations. Factors that affect the Company's ability to timely fillcustomer orders include: the availability of expanded manufacturing facilities;the Company's ability to attract and retain qualified manufacturing personnel tomeet anticipated manufacturing levels; the difficulties inherent inmanufacturing highly complex products that have only recently been introduced;and the availability of components, including semiconductor chips, which may bein short supply from time to time. In addition, the Company relies uponthird-party contract manufacturers for certain subsystems used in its products,and the Company's ability to meet customer orders for those products dependsupon the timeliness and quality of the work performed by these subcontractors,over whom the Company does not exercise any control.

The Company relies on certain intellectual property protections to preserveits intellectual property rights, including patents, copyrights, and tradesecrets. While the Company believes that its patents, copyrights, and tradesecrets have value, in general no single one is in itself essential. The Companybelieves that its technological position depends primarily on the technicalcompetence and creative ability of its research and development personnel. Fromtime to time the Company is notified that it may be in violation of patents heldby others. An assertion of patent infringement against the Company, ifsuccessful, could have a material adverse effect on the Company or could requirea lengthy and expensive defense which could adversely affect the Company'soperating results.

The development of new technologies, commercialization of thosetechnologies into products, and market acceptance and customer demand for thoseproducts is critical to the Company's success. Successful product developmentand introduction depends upon a number of factors, including the ability of theCompany to hire and retain qualified engineers, new product design, developmentof competitive products by competitors, timely and efficient completion ofproduct design, timely and efficient implementation of manufacturing andassembly processes and product performance at customer locations. The Company'sfailure to successfully develop, introduce and produce in commercial volume newor enhanced products, or failure of the market to accept these new or enhancedproducts could materially affect the Company's financial condition.

The Company faces substantial competition, throughout the world, in eachoperating segment. Some of these competitors have substantially greaterfinancial and other resources to pursue engineering, manufacturing, marketing

and distribution of their products. The Company also faces competition frominternal suppliers at several of its customers. Certain of the Company'scompetitors have introduced or announced new products with certain performancecharacteristics which may be considered equal or superior to those currentlyoffered by the Company. The Company expects its competitors to continue toimprove the performance of their current products and to introduce new productsor new technologies that provide improved cost of ownership and performancecharacteristics. New product introductions by competitors could cause a declinein sales or loss of market acceptance of the Company's existing products.Moreover, increased competitive pressure could lead to intensified price basedcompetition, which could materially adversely affect the Company's business,financial condition and results of operations.

The Company derives a significant portion of its total revenue fromcustomers outside the United States. International sales are subject tosignificant risks, including unexpected changes in legal and regulatoryrequirements and policy changes affecting the Company's markets, changes intariffs, exchange rates and other barriers, political and economic instability,difficulties in accounts receivable collection, difficulties in managingdistributors and representatives, difficulties in staffing and managinginternational operations, difficulties in protecting the Company's intellectualproperty and potentially adverse tax consequences.

The Company's semiconductor test systems operating segment generates asignificant portion of its revenue from customers operating in South Asiancountries and Taiwan. Although the economies of South Asian countries and Taiwanhave stabilized to some degree since mid fiscal 1998, if these economiesdeteriorate the negative economic developments would increase the likelihood ofeither a direct or indirect adverse impact on the Company's future operatingresults.

The Company's quarterly and annual operating results are affected by awide variety of factors that could materially adversely affect revenues andprofitability, including: competitive pressures on selling prices; the timingand cancellation of customer orders; changes in product mix; the Company'sability to introduce new products and technologies on a timely basis;introduction of products and technologies by the Company's competitors; marketacceptance of the Company's and its competitors' products; fulfilling backlog ona timely basis; reliance on sole source suppliers; potential retrofit costs; thelevel of orders received which can be shipped in a quarter; and the timing ofinvestments in engineering and development. As a result of the foregoing andother factors, the Company may experience material fluctuations in futureoperating results on a quarterly or annual basis which could materially andadversely affect its business, financial condition, operating results and stockprice.

12

13

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There were no material changes in the Company's exposure to market risk fromDecember 31, 1999.

PART II. OTHER INFORMATION

ITEM 1: LEGAL PROCEEDINGS

The Company is subject to legal proceedings and claims that arise in theordinary course of business. Management does not believe these actions will havea material adverse affect on the financial position or results of operations ofthe Company.

ITEM 4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The annual meeting of security holders of the Company was held May 25, 2000. Thefollowing were elected as Directors:

Total Vote Total Vote WithheldNominee For Each Nominee For Each Nominee------- ---------------- ----------------

Albert Carnesale 149,756,501 851,007George W. Chamillard 149,765,484 842,024Dwight H. Hibbard 149,735,702 871,806Roy A. Vallee 149,741,675 865,833

The term of office for the following directors continued after the meeting:Alexander V. d'Arbeloff, James W. Bagley, Daniel S. Gregory, John P. Mulroney,Vincent M. O'Reilly, Owen W. Robbins, Richard J. Testa, and Patricia S. Wolpert.Effective May 31, 2000, Alexander V. d'Arbeloff and Owen W. Robbins resigned asdirectors of the Company.

The security holders ratified the selection of the firmPricewaterhouseCoopers LLP as auditors for the fiscal year ending December 31,2000, with 149,995,037 shares voting in favor, 224,806 shares voting against,and 387,665 shares abstaining.

In addition, the security holders approved an amendment to the Company'sRestated Articles of Organization, as amended, increasing from 250,000,000 to1,000,000,000 the number of authorized shares of common stock, par value $.125per share, with 99,225,914 shares voting in favor, 51,015,882 shares votingagainst, and 365,712 shares abstaining.

ITEM 6: EXHIBITS AND REPORTS ON FORM 8-K

(a): Exhibits

Exhibit Number Description-------------- ----------- 3.01 Amendment to Articles of Incorporation 27.3 Financial Data Schedule

(b): Reports on Form 8-K

There were no Form 8-K filings by the Company during the quarter ended July 2,2000.

13

14

SIGNATURES ----------

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

TERADYNE, INC. --------------------------------------- Registrant

/s/ MICHAEL A. BRADLEY ------------------------------------- Michael A. Bradley Vice President and Chief Financial Officer

August 16, 2000

14

15 EXHIBIT INDEX

EXHIBIT NO. DESCRIPTION ----------- -----------

3.01 Amendment to Articles of Incorporation 27.3 Financial Data Schedule

15

1

EXHIBIT ____

FEDERAL IDENTIFICATION NO. 04-2272148 ------------------

THE COMMONWEALTH OF MASSACHUSETTS WILLIAM FRANCIS GALVIN Secretary of the Commonwealth One Ashburton Place, Boston, Massachusetts 02108-1512

ARTICLES OF AMENDMENT (GENERAL LAWS, CHAPTER 156B, SECTION 72)

We, George W. Chamillard , *President -------------------------------------------------------------

and William B. Asher, Jr. , *Assistant Clerk, --------------------------------------------------------

of Teradyne, Inc. , -------------------------------------------------------------------------- (Exact name of corporation)

located at 321 Harrison Avenue, Boston, MA 02118 , -------------------------------------------------------------------- (Street address of corporation in Massachusetts)

certify that these Articles of Amendment affecting articles numbered:

3-------------------------------------------------------------------------------- (Number those articles 1, 2, 3, 4, 5 and/or 6 being amended)

of the Articles of Organization were duly adopted at a meeting held on May 25, 2000, by vote of: ------ ----

99,225,914 shares of Common Stock of 172,794,091 shares outstanding,---------- ------------------------------- ----------- (type, class & series, if any)

shares of of shares outstanding, and---------- ------------------------------- ----------- (type, class & series, if any)

shares of of shares outstanding,---------- ------------------------------- ----------- (type, class & series, if any)

1**being at least a majority of each type, class or series outstanding andentitled to vote thereon:

*Delete the inapplicable words. **Delete the inapplicable clause.1 For amendments adopted pursuant to Chapter 156B, Section 70.2 For amendments adopted pursuant to Chapter 156B, Section 71.

NOTE: IF THE SPACE PROVIDED UNDER ANY ARTICLE OR ITEM ON THIS FORM ISINSUFFICIENT, ADDITIONS SHALL BE SET FORTH ON ONE SIDE ONLY OF SEPARATE 8 1/2 X 11 SHEETS OF PAPER WITH A LEFT MARGIN OF AT LEAST 1 INCH. ADDITIONS TO MORE THAN ONE ARTICLE MAY BE MADE ON A SINGLE SHEET SO LONG AS EACH ARTICLEREQUIRING EACH ADDITION IS CLEARLY INDICATED.

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2

To change the number of shares and the par value (if any) of any type, class orseries of stock which the corporation is authorized to issue, fill in thefollowing:

The total presently authorized is:

-------------------------------------------------- -------------------------------------------------------------------- WITHOUT PAR VALUE STOCKS WITH PAR VALUE STOCKS------------------ ------------------------------- ------------- ------------------------------- ---------------------- TYPE NUMBER OF SHARES TYPE NUMBER OF SHARES PAR VALUE------------------ ------------------------------- ------------- ------------------------------- ---------------------- Common: Common: 250,000,000 $.125------------------ ------------------------------- ------------- ------------------------------- ----------------------

------------------ ------------------------------- ------------- ------------------------------- ----------------------Preferred: Preferred:------------------ ------------------------------- ------------- ------------------------------- ----------------------

------------------ ------------------------------- ------------- ------------------------------- ----------------------

Change the total authorized to:

-------------------------------------------------- -------------------------------------------------------------------- WITHOUT PAR VALUE STOCKS WITH PAR VALUE STOCKS------------------ ------------------------------- ------------- ------------------------------- ---------------------- TYPE NUMBER OF SHARES TYPE NUMBER OF SHARES PAR VALUE------------------ ------------------------------- ------------- ------------------------------- ---------------------- Common: Common: 1,000,000,000 $.125------------------ ------------------------------- ------------- ------------------------------- ----------------------


------------------ ------------------------------- ------------- ------------------------------- ----------------------

3

The foregoing amendment(s) will become effective when these Articles ofAmendment are filed in accordance with General Laws, Chapter 156B, Section 6unless these articles specify, in accordance with the vote adopting theamendment, a later effective date not more than thirty days after such filing,

in which event the amendment will become effective on such later date.

Later effective date: . ---------------------------------------

SIGNED UNDER THE PENALTIES OF PERJURY, this 12th day of June , 2000, ---- ---------- ----

/s/ George W. Chamillard , *President -----------------------------------------------------------------

/s/ William B. Asher, Jr. *Assistant Clerk.--------------------------------------------------------------,

*Delete the inapplicable words.

4

THE COMMONWEALTH OF MASSACHUSETTS


=================================================================

I hereby approve the within Articles of Amendment and, the filing fee in the amount of $ 750,000 having been paid, said articles are deemed to have been filed with me this 13th day of June 2000.

Effective date: June 13, 2000 --------------------------------------

WILLIAM FRANCIS GALVIN Secretary of the Commonwealth

TO BE FILLED IN BY CORPORATION PHOTOCOPY OF DOCUMENT TO BE SENT TO:

Dana L. Keith, Corporate Paralegal -----------------------------------------------------------------

Testa, Hurwitz & Thibeault, LLP -----------------------------------------------------------------

125 High Street, Boston, MA 02110 -----------------------------------------------------------------

Telephone: (617)248-7874 -----------------------------------------------------------------

5

FEDERAL IDENTIFICATION NO. 04-2272148 -------------------

THE COMMONWEALTH OF MASSACHUSETTS WILLIAM FRANCIS GALVIN Secretary of the Commonwealth One Ashburton Place, Boston, Massachusetts 02108-1512


We, George W. Chamillard , *President --------------------------------------------------------------

and Donald G. Leka , *Assistant Clerk, --------------------------------------------------------

of Teradyne, Inc. , --------------------------------------------------------------------------- (Exact name of corporation)

located at 321 Harrison Avenue, Boston, Massachusetts 02118 , ------------------------------------------------------------------- (Street address of corporation in Massachusetts)


Article 3 -------------------------------------------------------------------------------- (Number those articles 1, 2, 3, 4, 5 and/or 6 being amended)

of the Articles of Organization were duly adopted at a meeting held on May 23 ,1996, by vote of:

63,652,370 shares of Common Stock of 71,452,818 shares outstanding,------------------ ----------------------------- ------------ (type, class & series, if any) shares of of shares outstanding, and------------------ ----------------------------- ------------ (type, class & series, if any) shares of of shares outstanding,------------------ ----------------------------- ------------ (type, class & series, if any)


*Delete the inapplicable words. **Delete the inapplicable clause.1 For amendments adopted pursuant to Chapter 156B, Section 70.2 For amendments adopted pursuant to Chapter 156B, Section 71.NOTE: IF THE SPACE PROVIDED UNDER ANY ARTICLE OR ITEM ON THIS FORM ISINSUFFICIENT, ADDITIONS SHALL BE SET FORTH ON ONE SIDE ONLY OF SEPARATE 8 1/2 X 11 SHEETS OF PAPER WITH A LEFT MARGIN OF AT LEAST 1 INCH.ADDITIONS TO MORE THAN ONE ARTICLE MAY BE MADE ON A SINGLE SHEET SO LONG AS EACHARTICLE REQUIRING EACH ADDITION IS CLEARLY INDICATED.

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-------------------------------------------------- --------------------------------------------------------------------

WITHOUT PAR VALUE STOCKS WITH PAR VALUE STOCKS------------------ ------------------------------- ------------- ------------------------------- ---------------------- TYPE NUMBER OF SHARES TYPE NUMBER OF SHARES PAR VALUE------------------ ------------------------------- ------------- ------------------------------- ---------------------- Common: Common: 125,000,000 $0.125------------------ ------------------------------- ------------- ------------------------------- ----------------------


------------------ ------------------------------- ------------- ------------------------------- ----------------------


-------------------------------------------------- -------------------------------------------------------------------- WITHOUT PAR VALUE STOCKS WITH PAR VALUE STOCKS------------------ ------------------------------- ------------- ------------------------------- ---------------------- TYPE NUMBER OF SHARES TYPE NUMBER OF SHARES PAR VALUE-------------------------------------------------- -------------------------------------------------------------------- Common: Common: 250,000,000 $0.125------------------ ------------------------------- ------------- ------------------------------- ----------------------


------------------ ------------------------------- ------------- ------------------------------- ----------------------

7

The foregoing amendment(s) will become effective when these Articles ofAmendment are filed in accordance with General Laws, Chapter 156B, Section 6unless these articles specify, in accordance with the vote adopting theamendment, a later effective date not more than thirty days after such filing,in which event the amendment will become effective on such later date.


SIGNED UNDER THE PENALTIES OF PERJURY, this 31 day of July , 1996, ---- ------------- --

/s/ George Chamillard , *President

------------------------------------------------------------------

/s/ Donald G. Leka , *Assistant Clerk.------------------------------------------------------------


8



============================================================

I hereby approve the within Articles of Amendment and, the filing fee in the amount of $125,000 having been paid, said articles are deemed to have been filed with me this 31st day of July 1996 .

Effective date: --------------------------------------------

/s/ William F. Galvin



Kevin M. Barry, Esq. -------------------------------------------------- Testa, Hurwitz & Thibeault, LLP 125 High Street --------------------------------------------------

Boston, MA 02110 --------------------------------------------------

9

FEDERAL IDENTIFICATION NO. 04-2272148 -------------------

THE COMMONWEALTH OF MASSACHUSETTS WILLIAM FRANCIS GALVIN Secretary of the Commonwealth One Ashburton Place, Boston, Massachusetts 02108


We, Owen W. Robbins , *Vice President ----------------------------------------------------------

and Donald G. Leka , *Assistant Clerk --------------------------------------------------------

of Teradyne, Inc. , -------------------------------------------------------------------------- (Exact name of corporation)

located at 321 Harrison Avenue, Boston, Massachusetts 02118 , ------------------------------------------------------------------ (Street address of corporation in Massachusetts)


Article 3-------------------------------------------------------------------------------- (Number those articles 1, 2, 3, 4, 5 and/or 6 being amended)

of the Articles of Organization were duly adopted at a meeting held on May 24, 1995, by vote of:------ --

26,581,818 shares of Common Stock of 37,173,315 shares outstanding,------------------ --------------------------- ----------------- (type, class & series, if any) shares of of shares outstanding, and------------------ --------------------------- ----------------- (type, class & series, if any) shares of of shares outstanding,------------------ --------------------------- ----------------- (type, class & series, if any)


*Delete the inapplicable words. **Delete the inapplicable clause.1 For amendments adopted pursuant to Chapter 156B, Section 70.2 For amendments adopted pursuant to Chapter 156B, Section 71.

NOTE: IF THE SPACE PROVIDED UNDER ANY ARTICLE OR ITEM ON THIS FORM ISINSUFFICIENT, ADDITIONS SHALL BE SET FORTH ON ONE SIDE ONLY OF SEPARATE 8 1/2 X 11 SHEETS OF PAPER WITH A LEFT MARGIN OF AT LEAST 1 INCH. ADDITIONS TOMORE THAN ONE ARTICLE MAY BE MADE ON A SINGLE SHEET SO LONG AS EACH ARTICLEREQUIRING EACH ADDITION IS CLEARLY INDICATED.

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-------------------------------------------------- -------------------------------------------------------------------- WITHOUT PAR VALUE STOCKS WITH PAR VALUE STOCKS-------------------------------------------------- -------------------------------------------------------------------- TYPE NUMBER OF SHARES TYPE NUMBER OF SHARES PAR VALUE------------------ ------------------------------- ------------- ------------------------------- ---------------------- Common: Common: 75,000,000 $0.125------------------ ------------------------------- ------------- ------------------------------- ----------------------


------------------ ------------------------------- ------------- ------------------------------- ----------------------


-------------------------------------------------- -------------------------------------------------------------------- WITHOUT PAR VALUE STOCKS WITH PAR VALUE STOCKS-------------------------------------------------- -------------------------------------------------------------------- TYPE NUMBER OF SHARES TYPE NUMBER OF SHARES PAR VALUE------------------ ------------------------------- ------------- ------------------------------- ---------------------- Common: Common: 125,000,000 $0.125------------------ ------------------------------- ------------- ------------------------------- ----------------------


------------------ ------------------------------- ------------- ------------------------------- ----------------------

11

The foregoing amendment(s) will become effective when these Articles ofAmendment are filed in accordance with General Laws, Chapter 156B, Section 6unless these articles specify, in accordance with the vote adopting theamendment, a later effective date not more than thirty days after such filing,in which event the amendment will become effective on such later date.


SIGNED UNDER THE PENALTIES OF PERJURY, this 14th day of July , 1995, ------ ------ --

/s/ Owen W. Robbins Executive Vice, *President--------------------------------------------------------------------

/s/ Donald G. Leka Assistant, *Clerk------------------------------------------------------------------------


12



=========================================================

I hereby approve the within Articles of Amendment and, the filing fee in the amount of $50,000.00 having been paid, said articles are deemed to have been filed with me this 17th day of July 1995 .

/s/ William Francis Galvin



Kevin M. Barry, Esq. ------------------------------------------------------- Testa, Hurwitz & Thibeault 53 State Street, Exchange Place -------------------------------------------------------

Boston, MA 02109 -------------------------------------------------------

13

Federal Identification No. 04-2272148 -------------- Fee: $250.00

THE COMMONWEALTH OF MASSACHUSETTS Michael Joseph Connolly Secretary of State One Ashburton Place, Boston, Massachusetts 02108

ARTICLES OF MERGER OF PARENT AND SUBSIDIARY CORPORATIONS (General Laws Chapter 156B, Section 82)

We, Owen W. Robbins and William B. Asher, Jr. Vice President* and -------------------------------------------------------

/ Assistant Clerk of Teradyne, Inc. ----------------------------------------------------

organized under the laws of Massachusetts and herein called the parent -------------

corporation, do hereby certify as follows:

1. That the subsidiary corporation(s) to be merged into the parent corporationare as follows:

NAME STATE OF ORGANIZATION DATE OF ORGANIZATION

AIDA Corporation California 6/15/84Zehntel, Inc. Delaware 10/24/75

2. That the parent corporation owns at least ninety percent of the outstandingshares of each class of the stock of each subsidiary corporation to be mergedinto the parent corporation.

3. That in the case of each of the above-named corporations the laws of thestate of its organization, if other than Massachusetts, permit the merger hereinprovided for and that all action required under the laws of each such state inconnection with this merger has been duly taken. (If all the corporations areorganized under the laws of Massachusetts and if General Laws, Chapter 156B isapplicable to them, then Paragraph 3 may be deleted.)

*Delete the inapplicable words. In case the parent corporation is organizedunder the laws of a state other than Massachusetts, these articles are to besigned by officers having corresponding powers and duties.

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4. That at a meeting of the directors of the parent corporation, the followingvote, pursuant to General Laws, Chapter 156B, Section 82, was duly adopted:

See Continuation Sheets

NOTE: Votes for which the space provided above is not sufficient should be setout on continuation sheets to be numbered 2A, 2B, etc. Continuation sheets musthave a left-hand margin 1 inch wide for binding. Only one side should be used.

15

5. The effective date of the merger shall be the date approved and filed bythe Secretary of the Commonwealth. If a later effective date is desired, specifysuch date, which shall not be more than thirty days after the date of filing:


IN WITNESS WHEREOF and under the penalties of perjury we have hereto signedour names this 27th day of December, 1989__________________. ---- --------

/s/ Owen W. Robbins, Vice President ------------------

/s/ William B. Asher, Assistant Clerk -------------------


16

Continuation Sheet

MERGER OF AIDA CORPORATION

VOTED: That the Agreement and Plan of Merger in the form attached hereto, providing for the merger of the Corporation's wholly-owned subsidiary, AIDA Corporation, with and into the corporation, with the Corporation constituting the surviving corporation, be, and hereby is, approved, with such changes therein or additions thereto as the officers executing the same shall approve, such approval to be evidenced conclusively by their execution and delivery thereof; and that the President or any Vice-President and Clerk or Assistant Clerk of the Corporation be, and they hereby are, authorized and empowered to execute and deliver the Agreement and Plan of Merger on behalf of the Corporation.

VOTED: That the President or any Vice-President and the Clerk or Assistant Clerk of the Corporation be, and hereby are, authorized and empowered to execute, acknowledge and file on behalf of the Corporation, the Certificate of Ownership in the form attached hereto, with the office of the Secretary of State for the State of California.

VOTED: At or after the effective date of the merger of AIDA Corporation with and into the Corporation, all debts, liabilities and duties of AIDA Corporation shall attach to the Corporation and may be enforced against the Corporation to the same extent as if such debts, liabilities and duties had been incurred or contracted by the Corporation.

VOTED: That the President or any Vice President and the Clerk or Assistant Clerk of the Corporation be, and hereby are, authorized and empowered to execute, acknowledge and file on behalf of the Corporation, the Articles of Merger in the form attached hereto, with the office of the Secretary of State of Massachusetts.

VOTED: That the effective date of such foregoing merger is and shall be January 1, 1990

VOTED: That the proper officers of the Corporation be, and each of them singly hereby is, authorized and empowered to execute and deliver such documents, instruments and certificates, make any payments and to take all actions as in his judgment may be necessary, desirable or appropriate in order to effectuate the intent and purposes of the foregoing resolutions.

17 Continuation Sheet

Merger of Zehntel, Inc.

VOTED: That the Agreement and Plan of Merger in the form attached hereto, providing for the merger of the Corporation's wholly-owned subsidiary, Zehntel, Inc. with and into the corporation, with the Corporation constituting the surviving corporation, be, and hereby is, approved, with such changes therein or additions thereto as the officers executing the same shall approve, such approval to be evidenced conclusively by their execution and delivery thereof; and that the President or any Vice-President and Clerk or Assistant Clerk of the Corporation be, and they hereby are, authorized and empowered to execute and deliver the Agreement and Plan of Merger on behalf of the Corporation.

VOTED: That the President or any Vice-President and the clerk or Assistant clerk of the Corporation be, and hereby are, authorized and empowered to execute, acknowledge and file on behalf of the Corporation, the Certificate of Ownership and Merger in the form attached hereto, with the office of the Secretary of State for the State of Delaware and a certified copy thereof in the office of the Recorder of Deeds of New Castle County in accordance with the General Corporation Law of the State of Delaware.

VOTED: That the President or any Vice-President and the Clerk of Assistant Clerk of the corporation be, and hereby are, authorized and empowered to execute, acknowledge and file on behalf of the Corporation, the Articles of Merger in the form attached as hereto, with the office of the Secretary of State of Massachusetts and a certified copy thereof in the Registry of Deeds in accordance with the Business Corporation Law of Massachusetts.

VOTED: That the effective date of such foregoing merger is and shall be January 1, 1990.


18


ARTICLES OF MERGER OF PARENT AND SUBSIDIARY CORPORATIONS (GENERAL LAWS, CHAPTER 156B, SECTION 82)

====================================

I hereby approve the within Articles of Merger of Parent and Subsidiary Corporations and, the filing fee in the amount of $250.00, ------- having been paid, said articles are deemed to have been filed with me this 28th day of December, 1989 ---- ---------

Effective date: 1/1/90 ------------

/s/ Michael Joseph Connolly MICHAEL JOSEPH CONNOLLY Secretary of State

TO BE FILLED IN BY CORPORATION Photocopy of document to be sent to:

Leslie S. White, Esq. -------------------------------------- c/o Testa Hurwitz & Thibeault -------------------------------------- 53 State Street, Exchange Place -------------------------------------- Boston, MA 02109 ---------------------------------- Telephone: (617) 367-7500 ----------------------------------

19

Federal Identification No. 04-2272148 ------------- Fee: $250.00

THE COMMONWEALTH OF MASSACHUSETTS William Francis Galvin Secretary of the Commonwealth One Ashburton Place, Boston, Massachusetts 02108-1512

ARTICLES OF MERGER OF PARENT AND SUBSIDIARY CORPORATIONS (General Laws Chapter 156B, Section 82)

We, Owen W. Robbins and William B. Asher Vice President* and --------------------------------------------------------

Assistant Clerk of Teradyne, Inc. (S) --------------------------------------------------------------

organized under the laws of Massachusetts and herein called the parentcorporation, certify as follows:

1. That the subsidiary corporation(s) to be merged into the parent corporation are:

NAME STATE OF ORGANIZATION DATE OF ORGANIZATION

CASE Technology, Inc. California 1/21/83

Teradyne Central, Inc. Delaware 12/15/72

Teradyne Connection Systems, Inc. Massachusetts 10/16/68

2.

3.


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4. That at a meeting of the directors of the parent corporation, the followingvote, pursuant to General Laws, Chapter 156B, Section 82, Subsection (a) wasduly adopted:


5. The effective date of the merger shall be the date approved and filed bythe Secretary of the Commonwealth. If a later effective date is desired, specifysuch date, which shall not be more than thirty days after the date of filing:


IN WITNESS WHEREOF and under the penalties of perjury we have hereto signedour names this 27th day of December, 1989.

/s/ Owen W. Robbins Vice President* ------------------

/s/ William B. Asher Assistant Clerk* --------------------


21


ARTICLES OF MERGER OF PARENT AND SUBSIDIARY CORPORATIONS (GENERAL LAWS, CHAPTER 156B, SECTION 82)

====================================

I hereby approve the within Articles of Merger of Parent and Subsidiary Corporations and, the filing fee in the amount of $250.00, ------- having been paid, said articles are deemed to have been filed with me this 28th day of December, 1989

Effective date: December 31, 1989

MICHAEL JOSEPH CANNILY Secretary of the Commonwealth

TO BE FILLED IN BY CORPORATION Photocopy of document to be sent to:

Leslie S. White, Esq. c/o Testa, Hurwitz & Thibeault 53 State Street, Exchange Place Boston, MA 02109

----------------------------------

Telephone: (617) 367-7500

22

Continuation Sheet

MERGER OF TERADYNE CENTRAL, INC.

VOTED: That the Agreement and Plan of Merger in the form attached hereto, providing for the merger of the corporation's wholly-owned subsidiary, Teradyne Central, Inc., with and into the corporation, with the Corporation constituting the surviving corporation, be, and hereby is, approved, with such changes therein or additions thereto as the officers executing the same shall approve, such approval to be evidenced conclusively by their execution and delivery thereof; and that the President or any Vice-President and Clerk or assistant Clerk of the Corporation be, and they hereby are, authorized and empowered to execute and deliver the Agreement and Plan of Merger on behalf of the Corporation.

VOTED: That the President or any Vice-President and the Clerk or Assistant Clerk of the Corporation be, and hereby are, authorized and empowered to execute, acknowledge and file on behalf of the Corporation, the Certificate of Ownership and Merger in the form attached hereto, with the office of the Secretary of State for the State of Delaware and a certified copy thereof in the office of the Recorder of Deeds of New Castle County in accordance with the General Corporation Law of the State of Delaware.

VOTED: That the President or any Vice-President and the Clerk or Assistant Clerk of the corporation be, and hereby are, authorized and empowered

to execute, acknowledge and file on behalf of the Corporation, the Articles of Merger in the form attached as hereto, with the office of the Secretary of State of Massachusetts and a certified copy thereof in the Registry Of Deeds in accordance with the Business Corporation Law of Massachusetts.

VOTED: That the effective date of such foregoing merger is and shall be December 31, 1990.


23

Continuation Sheet

Merger of Teradyne Connection Systems, Inc.

VOTED: That the Agreement and Plan of Merger in the form attached hereto, providing for the merger of the Corporation's wholly-owned subsidiary, Teradyne Connection Systems, Inc. with and into the Corporation, with the Corporation constituting the surviving corporation, be, and hereby is, approved, with such changes therein or additions thereto as the officers executing the same shall approve, such approval to be evidenced conclusively by their execution and delivery thereof; and that the President or any Vice-President and Clerk or Assistant Clerk of the Corporation be, and they hereby are, authorized and empowered to execute and deliver the Agreement and Plan of Merger on behalf of the Corporation.

VOTED: That the President or any Vice-President and the Clerk or Assistant Clerk of the Corporation be, and hereby are, authorized and empowered to execute, acknowledge and file on behalf of the Corporation, the Certificate of Ownership and Merger in the form attached hereto, with the office of the Secretary of State of State of Massachusetts and a certified copy thereof in the office of the Registry of Deeds of in accordance with the General Corporation Law of Massachusetts.



24

Continuation Sheet

Merger of CASE Technology Inc.

VOTED: That the Agreement and Plan of Merger in the form attached hereto, providing for the merger of the Corporation's wholly-owned subsidiary, CASE Technology Inc., with and into the Corporation, with the corporation constituting the surviving corporation, or additions thereto as the officers executing the same shall approve, such approval to be evidenced conclusively by their execution and delivery thereof; and that the President or any Vice-President and Clerk or Assistant Clerk of the Corporation be, and they hereby are, authorized and empowered to execute and deliver the Agreement and Plan of Merger

on behalf of the Corporation.

VOTED: That the President or any Vice-President and the clerk or Assistant clerk of the corporation be, and hereby are, authorized and empowered to execute, acknowledge and file on behalf of the Corporation, the Certificate of Ownership and Merger in the form attached hereto, with the office of the Secretary of State for the State of California.

VOTED: At and after the effective date of the merger of CASE Technology Inc. with and into the Corporation, all debts, liabilities and duties of CASE Technology Inc. shall attach to the Corporation and may be enforced against the Corporation to the same extent as if such debts, liabilities and duties had been incurred or contracted by the Corporation.

VOTED: That the President or any Vice-President and the Clerk or Assistant Clerk of the Corporation be, and hereby are, authorized and empowered to execute, acknowledge and file on behalf of the Corporation, the Articles of Merger in the form attached as hereto, with the office of the Secretary of State of Massachusetts and a certified copy thereof in the Registry of Deeds in accordance with the Business Corporation Law of Massachusetts.



25

THE COMMONWEALTH OF MASSACHUSETTS__________ MICHAEL JOSEPH CONNOLLY FEDERALExaminer Secretary of State IDENTIFICATION NO.: ONE ASHBURTON PLACE 04-2272148 BOSTON, MASS 02108

ARTICLES OF MERGER OF PARENT AND SUBSIDIARY CORPORATION PURSUANT TO GENERAL LAWS, CHAPTER 156B, SECTION 82

The fee for filing this certificate is prescribed by General Laws, Chapter 156B, Section 114. Make check payable to the Commonwealth of Massachusetts.

* * * *

We, Owen W. Robbins and William B. Asher, Vice President* ----------------------------------------------------------

and /Assistant Clerk* of Teradyne, Inc., ----------------------------------------

organized under the laws of Massachusetts and herein called the parent -------------corporation, do hereby certify as follows:

1. That the subsidiary corporation(s) to be merged into the parentcorporation are/is as follows:

Name State of Organization Date of Organization

1. Teradyne Digitest, Inc. Delaware April 14, 1978

2. That the parent corporation owns at least ninety per cent of theoutstanding shares of each class of the stock of each subsidiary corporation tobe merged into the parent corporation.

3. That in the case of each of the above-named corporations the laws ofthe state of its organization, if other than Massachusetts, permit the mergerherein provided for and that all action required under the laws of each suchstate in connection with this merger has been duly taken. (If all thecorporations are organized under the laws of the Massachusetts and if GeneralLaws, Chapter 156B is applicable to them, then Paragraph 3 may be deleted).

* Delete the inapplicable words. In case the parent corporation is organized under the laws of a state other than Massachusetts these articles are to be signed by officers having corresponding powers and duties.

-----------------* Delete the inapplicable words. In case the parent corporation is organized under the laws of a state other than Massachusetts these articles are to be signed by officers having corresponding powers and duties.

26

4. That at a meeting of the directors of the parent corporation thefollowing vote, pursuant to subsection (a) of General Laws. Chapter 156B,Section 82, was duly adopted:

VOTED: That the Agreement and Plan of Merger in the form attached as EXHIBIT A hereto, providing for the merger of Teradyne Digitest, Inc. with and into Teradyne, Inc., with Teradyne, Inc. constituting the surviving corporation, be, and hereby is, approved, with such changes therein or additions thereto as the officers executing the same shall approve, such approval to be evidenced conclusively by their execution and delivery thereof; and that the President or any Vice-President and Clerk or Assistant Clerk of the Company be, and they hereby are, authorized and empowered to execute and deliver the Agreement and Plan of Merger on behalf of Teradyne, Inc.

VOTED: That the President or any Vice-President and the Clerk or Assistant Clerk of Teradyne, inc. be, and hereby are, authorized and empowered to execute, acknowledge and file on behalf of Teradyne, Inc., the Articles of Merger in the form attached as hereto, with the office of the Secretary of State of Massachusetts.


VOTED: That the proper officers of Teradyne, Inc. be, and each of them singly hereby is, authorized and empowered to execute and deliver such documents, instruments and certificates, make any payments and to take all actions as in his judgment may be necessary, desirable or appropriate in order to effectuate the intent and purposes of the foregoing resolutions.

NOTE: Notes for which the space provided above is not sufficient should be set out on continuation sheets to be numbered 2A, 2B etc. Continuation sheets must have a left-hand margin 1 inch wide for binding. Only one side should be used.

27

5. The effective date of the merger as specified in the vote set outunder Paragraph 4 is

December 31, 1988

6. (This Paragraph 6 may be deleted if the parent corporation isorganized under the laws of Massachusetts.) The parent corporation hereby agreesthat it may be sued in the Commonwealth of Massachusetts for any priorobligation of any subsidiary corporation organized under the laws ofMassachusetts with which it has merged, and any obligation hereafter incurred bythe parent corporation, including the obligation created by subsection (e) ofGeneral Laws, Chapter 156B, Section 82, so long as any liability remainsoutstanding against the parent corporation in the Commonwealth of Massachusettsand it hereby irrevocably appoints the Secretary of the Commonwealth as itsagent to accept service of process for the enforcement of any such obligations,including taxes, in the same manner as provided in Chapter 181.

IN WITNESS WHEREOF and under the penalties of perjury we have hereto signedour names this 29th day of December, 1988.

/s/ Owen W. Robbins -------------------------- Vice President*

/s/ William B. Asher ------------------------------ Assistant Clerk*

* Delete the inapplicable words. In case the parent corporation is organized under the laws of a state other than Massachusetts these articles are to be signed by officers having corresponding powers and duties.

28

COMMONWEALTH OF MASSACHUSETTS ARTICLES OF MERGER OF PARENT AND SUBSIDIARY CORPORATIONS

(General Laws, Chapter 156B, Section 82)

I hereby approve the within articles of merger of parent and subsidiarycorporations and, the filing fee in the amount of $200.00 having been paid, saidarticles are deemed to have been filed with me this 29th day of December, 1988. ---- --------

EFFECTIVE DATEDECEMBER 31, 1988


TO BE FILLED IN BY CORPORATION Photo Copy of Merger to Be Sent

TO: Leslie S. White, Esq. c/o Testa, Hurwitz & Thibeault 53 State Street Boston, MA 02109 Telephone: (617) 367-7500

29

THE COMMONWEALTH OF MASSACHUSETTS---------Examiner OFFICE OF THE MASSACHUSETTS SECRETARY OF STATE FEDERAL IDENTIFICATION MICHAEL JOSEPH CONNOLLY, Secretary ONE ASHBURTON PLACE, BOSTON, MASS. 02108 NO. 04-2272148

ARTICLES OF AMENDMENT

General Laws, Chapter 156B, Section 72

This certificate must be submitted to the Secretary of the Commonwealth within sixty days after the date of the vote of stockholders adopting the amendment. The fee for filing this certificate is prescribed by General Laws, Chapter 156B, Section 114. Make check payable to the Commonwealth of Massachusetts.

---------

and We, Alexander V. d'Arbeloff, , President Richard J. Testa, , Clerk of

TERADYNE --------------------------------------------------------------------------- (Name of Corporation)

located at 321 Harrison Avenue, Boston, Massachusetts 02118

do hereby certify that the following amendment to the articles of reorganization of the corporation was duly adopted at a meeting held on May 8, 1987, by vote of

17,740,199 shares of common stock out of 23,898,176 shares outstanding

-----------approved

CROSS OUT being at least two-thirds of each class outstanding and INAPPLICABLE entitled to vote thereon and of each class or series of CLAUSE stock whose rights are adversely affected thereby:(2)

C [ ] P [ ]M [ ]

(1) For amendments adopted pursuant to Chapter 156B, Section 70. (2) For amendments adopted pursuant to Chapter 156B Section 71.

Note: If the space provided under any amendments or item on this form is insufficient, additions shall be set forth on separate 8 1/2 x 11 sheets of paper leaving a left hand margin of at least 1 inch for binding.

30

Additions to more than one Amendment may be continued on a single sheet so long as each Amendment requiring each such addition is clearly indicated.

31

TO CHANGE the number of shares and the par value, if any, of each class of stockwithin the corporation fill in the following:


----------------- ---------------------- -------------------- -------------- NO PAR VALUE NUMBER OF WITH PAR VALUE PAR VALUE KIND OF STOCK SHARES NUMBER OF SHARES----------------- ---------------------- -------------------- -------------- COMMON----------------- ---------------------- -------------------- --------------

----------------- ---------------------- -------------------- --------------

----------------- ---------------------- -------------------- -------------- PREFERRED----------------- ---------------------- -------------------- --------------

----------------- ---------------------- -------------------- --------------

----------------- ---------------------- -------------------- --------------

CHANGE the total to:

---------------- ------------------------- --------------------- -------------- NO PAR VALUE NUMBER OF WITH PAR VALUE PAR VALUE KIND OF STOCK SHARES NUMBER OF SHARES---------------- ------------------------- --------------------- -------------- COMMON---------------- ------------------------- --------------------- --------------

---------------- ------------------------- --------------------- --------------

---------------- ------------------------- --------------------- -------------- PREFERRED---------------- ------------------------- --------------------- --------------

---------------- ------------------------- --------------------- --------------

---------------- ------------------------- --------------------- --------------

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Article Six is hereby amended to add the following paragraph:

"No director shall be personally liable to the Corporation or itsstockholders for monetary damages for breach of fiduciary duty as a directornotwithstanding any provision of law imposing such liability; provided, that, tothe extent provided by applicable law, this provision shall not eliminate orlimit the liability of a director (i) for any breach of the director's duty ofloyalty to the Corporation or its stockholders, (ii) for acts or omissions notin good faith or which involve intentional misconduct or a knowing violation oflaw, (iii) under Section sixty-one or sixty-two of Chapter 156B of theMassachusetts General Laws, or (iv) for any transaction from which the directorderived an improper personal benefit. This provision shall not eliminate theliability of a director for any act or omission occurring prior to the date uponwhich this provision becomes effective. No amendment to or repeal of thisprovision shall apply to or have any effect upon the liability or allegedliability of any director for or with respect to any acts or omissions of suchdirector occurring prior to such amendment or repeal."

The foregoing amendment will become effective when these articles ofamendment are filed in accordance with Chapter 156B, Section 6 of the GeneralLaws unless these articles specify, in accordance with the vote adopting theamendment, a later effective date not more than thirty days after such filing,in which event the amendment will become effective on such later date.

IN WITNESS WHEREOF AND UNDER THE PENALTIES OF PERJURY, we have hereto signed ournames this 8th day of May, in the year 1987.

/s/ Alexander V. d'Arbeloff Alexander V. d'Arbeloff President/s/ Richard J. Testa Richard J. Testa Clerk

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ARTICLES OF AMENDMENT

(General Laws, Chapter 156B, Section 72)

I hereby approve the within articles of amendment and, the filing fee in the amount of $75.00 having been paid, said articles are deemed to have been filed with me this 12 day of May 1987.

/s/Michael Joseph Connolly MICHAEL JOSEPH CONNOLLY Secretary of State


TO: Richard D. Sloman, Esq. c/o Testa, Hurwitz & Thibeault 53 State Street Boston, MA 02109 Telephone: (617) 367-7500

34

THE COMMONWEALTH OF MASSACHUSETTS---------Examiner MICHAEL JOSEPH CONNOLLY FEDERAL IDENTIFICATION Secretary of State ONE ASHBURTON PLACE, BOSTON, MASS. 02108 NO. 04-2272148

RESTATED ARTICLES OF ORGANIZATION

GENERAL LAWS, CHAPTER 156B, SECTION 74

This certificate must be submitted to the Secretary of the Commonwealth within sixty days after the date of the vote of stockholders adopting the restated articles of organization. The fee for filing this certificate is prescribed by General Laws, Chapter 156B, Section 114. Make

check payable to the Commonwealth of Massachusetts.

---------

We, Alexander V. d'Arbeloff , President, and Richard J. Testa , Clerk of

TERADYNE, INC. --------------------------------------------------------------------------- (Name of Corporation)

located at 321 Harrison Avenue, Boston Massachusetts 02118

do hereby certify that the following restatement of the articles of organization of the corporation was duly adopted at a meeting held on May 14, 1984, by vote of

15,720,764 shares of common stock out of 22,070,973 shares outstanding

being at least a majority of each class of stock outstanding and entitled to vote and of each class or series of stock adversely affected thereby:-

1. The name by which the corporation shall be known is: -

Teradyne, Inc.

2. The purposes for which the corporation is formed are as follows: -

See Page 2A

C [ ]P [ ]M [ ]RA [ ]

-------P.C.

Note: If the space provided under any amendments or item on this form is insufficient, additions shall be set forth on separate 8 1/2 x 11 sheets of paper leaving a left hand margin of at least 1 inch for binding. Additions to more than one Amendment may be continued on a single sheet so long as each Amendment requiring each such addition is clearly indicated.

35

3. The total number of shares and the par value, if any, of each class ofstock which the corporation is authorized to issue is as follows:

CLASS OF STOCK WITHOUT PAR VALUE WITH PAR VALUE NUMBER OF SHARES NUMBER OF SHARES PAR VALUE

Preferred NONE NONE --- Common NONE 75,000,000 $.125

*4. If more than one class is authorized, a description of each of thedifferent classes of stock with, if any, the preferences, voting powers,qualifications, special or relative rights or privileges as to each classthereof and any series now established:

NONE

*5. The restrictions, if any, imposed by the articles of organization upon thetransfer of shares of stock of any class are as follows:

NONE

*6. Other lawful provisions, if any, for the conduct and regulation of thebusiness and affairs of the corporation, for its voluntary dissolution, or for

limiting, defining, or regulating the powers of the corporation, or of itsdirectors or stockholders, or of any class of stockholders:

The directors may make, amend or repeal the By-Laws in whole or in part, except with respect to any provision thereof which by law or by the By-Laws requires action by the stockholders.

Meetings of the stockholders may be held anywhere in the United States.

The corporation may be a partner in any business enterprise.

*If there are no such provisions, state "None."

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2A

To design, develop, manufacture, assemble, produce, acquire, own, buy,import, sell, export, dispose of and otherwise deal in electronic orelectromechanical products or components, and personal property of every kindand description.

To acquire, buy, own and sell securities (including the securities of thiscorporation), patents, licenses, trade marks, trade names and all rights ofevery kind thereunder.

To acquire, buy, construct, own, lease, mortgage and sell real estate,buildings or any interests therein necessary or desirable for the purposes ofthe corporation.

To acquire all or any part of the goodwill, rights and property, and toassume the whole or any part of the contracts or liabilities of any firm,association, corporation or person, and to pay for such acquisition in cash,stock or other securities of this corporation or otherwise.

To exercise any of the foregoing purposes of powers through subsidiary oraffiliated corporations, and in connection therewith and otherwise to have allthe powers conferred now or in future by the Commonwealth of Massachusetts uponbusiness corporations.

37

*We further certify that the foregoing restated articles of organization effectno amendments to the articles of organization of the corporation at heretoforeamended, except amendments to the following articles

Article 3.

Briefly describe amendments in space below:

Article 3 is amended by increasing the number of shares of Common Stock, $.125par value, which the Corporation is authorized to issue from 30,000,000 sharesto 75,000,000 shares.

IN WITNESS WHERE AND UNDER THE PENALTIES OF PERJURY, we have hereto signed ournames this 14th day of May in the year 1984

/s/ Alexander V. d'Arbeloff President--------------------------- /s/ Richard J. Testa Clerk--------------------

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RESTATED ARTICLES OF ORGANIZATION

(GENERAL LAWS, CHAPTER 156B, SECTION 74)

I hereby approve the within restated articles of organization and, the filing fee in the amount of $22,650.00 having been paid, said articles are deemed to have been filed with me this 21st day of May , 1984



TO: Richard J. Testa, Esq. c/o Testa, Hurwitz & Thibeault Sixty State Street Boston, MA 02109 Telephone: (617) 367-7500

<ARTICLE> 5<LEGEND>THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THECONDENSED CONSOLIDATED BALANCE SHEET AT JULY 2, 2000 AND THE CONDENSEDCONSOLIDATED STATEMENT OF INCOME FOR THE THREE MONTHS ENDED JULY 2, 2000 AND ISQUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.</LEGEND><CIK> 0000097210<NAME> TERADYNE, INC.<MULTIPLIER> 1,000<CURRENCY> U.S. DOLLARS <PERIOD-TYPE> 3-MOS<FISCAL-YEAR-END> DEC-31-2000<PERIOD-START> APR-03-2000<PERIOD-END> JUL-02-2000<EXCHANGE-RATE> 1<CASH> 163,247<SECURITIES> 133,764<RECEIVABLES> 491,440<ALLOWANCES> 5,529<INVENTORY> 411,729<CURRENT-ASSETS> 1,280,750<PP&E> 1,065,971<DEPRECIATION> 477,677<TOTAL-ASSETS> 2,032,436<CURRENT-LIABILITIES> 518,619<BONDS> 0<PREFERRED-MANDATORY> 0<PREFERRED> 0<COMMON> 21,676<OTHER-SE> 1,469,505<TOTAL-LIABILITY-AND-EQUITY> 2,032,436<SALES> 758,955<TOTAL-REVENUES> 758,955<CGS> 402,570<TOTAL-COSTS> 568,189<OTHER-EXPENSES> 0<LOSS-PROVISION> 0<INTEREST-EXPENSE> 412<INCOME-PRETAX> 196,589<INCOME-TAX> 58,977<INCOME-CONTINUING> 137,612<DISCONTINUED> 0<EXTRAORDINARY> 0<CHANGES> 0<NET-INCOME> 137,612<EPS-BASIC> .79<EPS-DILUTED> .76

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