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Segment Information
 3 Months Ended
Apr. 05, 2015
Segment Information

Q. Segment Information

Teradyne has three operating segments (Semiconductor Test, Wireless Test and System Test), which are its reportable segments. The Semiconductor Test segment includes operations related to the design, manufacturing and marketing of semiconductor test products and services. The Wireless Test segment includes operations related to the design, manufacturing and marketing of wireless test products and services. The System Test segment includes operations related to the design, manufacturing and marketing of products and services for defense/aerospace instrumentation test, storage test and circuit-board test. Each operating segment has a segment manager who is directly accountable to and maintains regular contact with Teradyne’s chief operating decision maker (Teradyne’s chief executive officer) to discuss operating activities, financial results, forecasts, and plans for the segment.

 

Teradyne evaluates performance based on several factors, of which the primary financial measure is business segment income before income taxes. The accounting policies of the business segments are the same as those described in Note B: “Accounting Policies” in Teradyne’s Annual Report on Form 10-K for the year ended December 31, 2014.

Segment information for the three months ended April 5, 2015 and March 30, 2014 is as follows:

 

     Semiconductor
Test		      Wireless
Test		     System
Test		      Corporate
and
Eliminations		     Consolidated  
     (in thousands)  

Three months ended April 5, 2015:

             

Revenues

    $ 270,917       $ 34,048      $ 37,436       $ —       $ 342,401   

Income (loss) before taxes (1)(2)

      43,125         (10,441 )      1,005         8,749        42,438   

Three months ended March 30, 2014:

             

Revenues

    $ 261,737       $ 21,210      $ 38,063       $ —       $ 321,010   

Income (loss) before taxes (1)(2)

      34,600         (25,085 )      448         (11,836 )      (1,873 ) 

 

(1) Interest income, interest expense, and other (income) expense, net are included in Corporate and Eliminations.
(2) Included in the income (loss) before income taxes for each of the segments are charges related to inventory and other.

Included in the Semiconductor Test segment are charges and credits in the following line item in the statements of operations:

 

     For the Three Months
Ended		  
     April 5, 2015      March 30, 2014  
     (in thousands)  

Cost of revenues - inventory charge

    $ 531       $ 6,205   

Included in the Wireless Test segment are charges and credits in the following line item in the statements of operations:

 

     For the Three Months
Ended		  
     April 5, 2015      March 30, 2014  
     (in thousands)  

Cost of revenues - inventory charge

    $ 846       $ 3,093   

Included in the System Test segment are charges and credits in the following line item in the statements of operations:

 

     For the Three Months
Ended		  
     April 5, 2015      March 30, 2014  
     (in thousands)  

Cost of revenues - inventory charge

    $ 63       $ 741   

Included in Corporate and Eliminations are charges and credits in the following line items in the statements of operations:

 

     For the Three Months
Ended		  
     April 5, 2015      March 30, 2014  
     (in thousands)  

Other (income) expense, net - gain from the sale of an equity investment

    $ (4,782 )     $ —     

Selling and administrative - stock- based compensation charge (1)

      —           6,598   

 

(1) See Note J: “Stock-Based Compensation” regarding the stock-based compensation charge.