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Retirement Plans (Tables)

12 Months Ended

Dec. 31, 2014

Defined Benefit Pension Plans

Defined Benefit Pension and Postretirement Benefit Plan Assets and Obligations

The December 31 balances of these defined benefit pension plans assets and obligations are shown below:

		2014								2013
		United States				Foreign				United States				Foreign
		(in thousands)
Assets and Obligations
Change in benefit obligation:
Projected benefit obligation:
Beginning of year		$	293,912			$	52,182			$	325,118			$	51,380
Service cost			2,218				897				2,393				1,034
Interest cost			12,875				1,837				11,318				1,948
Actuarial loss (gain)			72,596				8,975				(31,259	)			(1,020	)
Benefits paid			(13,982	)			(1,265	)			(13,658	)			(2,511	)
Plan participants’ contributions			—				88				—				95
Non-U.S. currency movement			—				(4,504	)			—				1,256
End of year			367,619				58,210				293,912				52,182
Change in plan assets:
Fair value of plan assets:
Beginning of year			256,373				25,756				278,856				24,043
Company contributions			31,753				1,168				1,738				2,522
Plan participants’ contributions			—				88				—				95
Actual return on plan assets			41,928				5,192				(10,563	)			1,190
Benefits paid			(13,982	)			(1,265	)			(13,658	)			(2,511	)
Non-U.S. currency movement			—				(1,428	)			—				417
End of year			316,072				29,511				256,373				25,756
Funded status		$	(51,547	)		$	(28,699	)		$	(37,539	)		$	(26,426	)

Amounts Recorded Within Statement of Financial Position

The following table provides amounts recorded within the account line items of the statement of financial position as of December 31:

		2014								2013
		United States				Foreign				United States				Foreign
		(in thousands)
Retirement plans assets		$	3,090			$	9,806			$	4,259			$	5,083
Accrued employees’ compensation and withholdings			(2,492	)			(906	)			(1,781	)			(1,143	)
Retirement plans liabilities			(52,145	)			(37,599	)			(40,017	)			(30,366	)
Funded status		$	(51,547	)		$	(28,699	)		$	(37,539	)		$	(26,426	)

Amounts Recognized in Accumulated Other Comprehensive Income

The following table provides amounts recognized in accumulated other comprehensive income as of December 31:

		2014								2013
		United States				Foreign				United States				Foreign
		(in thousands)
Prior service cost, before tax		$	358			$	—			$	493			$	—
Deferred taxes			429				—				380				—
Total recognized in other comprehensive income, net of tax		$	787			$	—			$	873			$	—

Pension Plans with Accumulated Benefit Obligation and Projected Benefit Obligation in Excess of Plan Assets

Information for pension plans with an accumulated benefit obligation in excess of plan assets as of December 31:

		2014								2013
		United States				Foreign				United States				Foreign
		(in millions)
Projected benefit obligation		$	54.6			$	39.5			$	41.8			$	32.4
Accumulated benefit obligation			48.5				32.7				37.9				27.5
Fair value of plan assets			—				1.0				—				0.9

Net Periodic Pension and Postretirement Benefit Costs

For the years ended December 31, 2014, 2013 and 2012, Teradyne’s net periodic postretirement benefit income was comprised of the following:

		2014				2013				2012
		(in thousands)
Components of Net Periodic Postretirement Benefit Income:
Service cost		$	59			$	75			$	67
Interest cost			335				342				437
Amortization of prior service cost			(598	)			(598	)			(599	)
Net actuarial (gain) loss			(1,255	)			(2,025	)			83
Total net periodic postretirement benefit income			(1,459	)			(2,206	)			(12	)
Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income:
Reversal of amortization items:
Prior service credit			598				598				599
Total recognized in other comprehensive income			598				598				599
Total recognized in net periodic postretirement benefit income and other comprehensive income		$	(861	)		$	(1,608	)		$	587

Weighted Average Assumptions to Determine Net Periodic Pension Cost

Weighted Average Assumptions to Determine Net Periodic Pension Cost at January 1:

		2014								2013								2012
		United States				Foreign				United States				Foreign				United States				Foreign
Discount rate			4.5	%			3.8	%			3.6	%			3.7	%			4.2	%			4.9	%
Expected return on plan assets			5.0				3.4				5.0				3.7				5.0				3.1
Salary progression rate			3.0				3.5				3.0				3.5				3.0				3.4

Weighted Average Assumptions to Determine Pension Obligations

Weighted Average Assumptions to Determine Pension Obligations at December 31:

		2014								2013
		United States				Foreign				United States				Foreign
Discount rate			3.7	%			2.6	%			4.5	%			3.8	%
Salary progression rate			2.9				3.2				3.0				3.5

Weighted Average Pension Asset Allocations by Category

Teradyne’s weighted average pension asset allocation at December 31, 2014 and 2013, by asset category is as follows:

		2014								2013
		United States				Foreign				United States				Foreign
Fixed Income Securities			83.3	%			78.2	%			86.7	%			77.1	%
Equity Securities			15.4				20.7				12.1				21.6
Other			1.3				1.1				1.2				1.3
			100.0	%			100.0	%			100.0	%			100.0	%

Target Asset Allocation and Index for Each Asset Category

The target asset allocation and the index for each asset category for the U.S. Plan, per the investment policy, are as follows:

Asset Category:		Policy Index:		Target Allocation
Passive and Active Fixed Income		Barclays U.S. Long Government/Credit Bond Index			85	%
Equity (Large cap)		S&P 500 Stock Index			10
International Equity		MSCI EAFE Index			5

Changes in Fair Value of Pension Assets

The fair value of pension plan assets by asset category and by level at December 31, 2014 and December 31, 2013 were as follows:

		December 31, 2014
		United States																Foreign
		Level 1				Level 2				Level 3				Total				Level 1				Level 2				Level 3				Total
		(in thousands)
Fixed income securities:
Corporate debt securities		$	—			$	193,741			$	—			$	193,741			$	—			$	—			$	—			$	—
U.S. government securities			—				65,830				—				65,830				—				—				—				—
U.K. government securities			—				—				—				—				—				22,811				—				22,811
Asset backed securities			—				3,747				—				3,747				—				—				—				—
U.S. equity (large cap)			—				33,970				—				33,970				—				—				—				—
International equity			—				14,631				—				14,631				—				5,610				—				5,610
Guarantee annuity contract			—				2,990				—				2,990				—				—				—				—
Other			—				65				—				65				—				957				—				957
Cash and cash equivalents			1,098				—				—				1,098				133				—				—				133
Total		$	1,098			$	314,974			$	—			$	316,072			$	133			$	29,378			$	—			$	29,511

		December 31, 2013
		United States																Foreign
		Level 1				Level 2				Level 3				Total				Level 1				Level 2				Level 3				Total
		(in thousands)
Fixed income securities:
Corporate debt securities		$	—			$	156,860			$	—			$	156,860			$	—			$	—			$	—			$	—
U.S. government securities			—				62,555				—				62,555				—				—				—				—
U.K. government securities			—				—				—				—				—				19,610				—				19,610
Asset backed securities			—				2,919				—				2,919				—				—				—				—
U.S. equity (large cap)			—				21,309				—				21,309				—				—				—				—
International equity			—				9,599				—				9,599				—				5,204				—				5,204
Guarantee annuity contract			—				2,985				—				2,985				—				—				—				—
Other			—				—				—				—				—				906				—				906
Cash and cash equivalents			146				—				—				146				—				36				—				36
Total		$	146			$	256,227			$	—			$	256,373			$	—			$	25,756			$	—			$	25,756

Expected Future Benefit Payments

Future benefit payments are expected to be paid as follows:

		United States				Foreign
		(in thousands)
2015		$	24,407			$	1,018
2016			23,399				862
2017			23,129				1,069
2018			22,455				1,076
2019			21,826				1,230
2020-2024			112,546				9,349

Postretirement Benefit Plans

Defined Benefit Pension and Postretirement Benefit Plan Assets and Obligations

The December 31 balances of the postretirement assets and obligations are shown below:

		2014				2013
		(in thousands)
Assets and Obligations
Change in benefit obligation:
Projected benefit obligation:
Beginning of year		$	9,019			$	11,907
Service cost			59				75
Interest cost			335				342
Actuarial (gain) loss			(1,255	)			(2,025	)
Benefits paid			(996	)			(1,280	)
End of year			7,162				9,019
Change in plan assets:
Fair value of plan assets:
Beginning of year			—				—
Company contributions			996				1,280
Benefits paid			(996	)			(1,280	)
End of year			—				—
Funded status		$	(7,162	)		$	(9,019	)

Amounts Recorded Within Statement of Financial Position

The following table provides amounts recorded within the account line items of financial position as of December 31:

		2014				2013
		(in thousands)
Accrued employees’ compensation and withholdings		$	(780	)		$	(1,042	)
Retirement plans liability			(6,382	)			(7,977	)
Funded status		$	(7,162	)		$	(9,019	)

Amounts Recognized in Accumulated Other Comprehensive Income

The following table provides amounts recognized in accumulated other comprehensive income as of December 31:

		2014				2013
		(in thousands)
Prior service credit, before tax		$	(2,230	)		$	(2,829	)
Deferred taxes			(882	)			(664	)
Total recognized in other comprehensive income, net of tax		$	(3,112	)		$	(3,493	)

Net Periodic Pension and Postretirement Benefit Costs

For the years ended December 31, 2014, 2013 and 2012, Teradyne’s net periodic pension cost (income) was comprised of the following:

		2014								2013								2012
		United States				Foreign				United States				Foreign				United States				Foreign
		(in thousands)
Components of Net Periodic Pension Cost (Income):
Service cost		$	2,218			$	897			$	2,393			$	1,034			$	2,102			$	686
Interest cost			12,875				1,837				11,318				1,948				13,713				1,956
Expected return on plan assets			(12,500	)			(868	)			(13,632	)			(959	)			(15,248	)			(698	)
Amortization of prior service cost			135				—				164				—				232				—
Net actuarial loss (gain)			43,168				4,651				(7,063	)			(1,252	)			15,458				7,779
Total net periodic pension cost (income)		$	45,896			$	6,517			$	(6,820	)		$	771			$	16,257			$	9,723
Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income:
Reversal of amortization items:
Prior service cost			(135	)			—				(164	)			—				(232	)			—
Total recognized in other comprehensive income			(135	)			—				(164	)			—				(232	)			—
Total recognized in net periodic pension cost (income) and other comprehensive income		$	45,761			$	6,517			$	(6,984	)		$	771			$	16,025			$	9,723

Weighted Average Assumptions to Determine Net Periodic Pension Cost

Weighted Average Assumptions to Determine Net Periodic Postretirement Benefit Income as of January 1:

		2014				2013				2012
Discount rate			4.1	%			3.1	%			3.7	%
Initial Health Care Cost Trend Rate			8.0				8.5				9.0
Ultimate Health Care Cost Trend Rate			5.0				5.0				5.0
Year in which Ultimate Health Care Cost Trend Rate is reached			2020				2020				2020

Weighted Average Assumptions to Determine Pension Obligations

Weighted Average Assumptions to Determine Postretirement Benefit Obligation as of December 31:

		2014				2013				2012
Discount rate			3.5	%			4.1	%			3.1	%
Initial Medical Trend			7.5				8.0				8.5
Ultimate Health Care Trend			5.0				5.0				5.0
Medical cost trend rate decrease to ultimate rate in year			2022				2020				2020

Expected Future Benefit Payments

Future benefit payments are expected to be paid as follows:

		Benefits Payments
		(in thousands)
2015		$	780
2016			738
2017			657
2018			599
2019			535
2020-2024			2,045

One Percentage Point Change in Assumed Health Care Cost Trend Rates for Year

A one percentage point change in the assumed health care cost trend rates for the year ended December 31, 2014, would have the following effects:

		1 Percentage Point Increase				1 Percentage Point Decrease
		(in thousands)
Effect on total service and interest cost components		$	6			$	(6	)
Effect on postretirement benefit obligations			87				(83	)

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