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Retirement Plans (Tables)

12 Months Ended

Dec. 31, 2015

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:

		2015								2014
		United States				Foreign				United States				Foreign
		(in thousands)
Assets and Obligations
Change in benefit obligation:
Projected benefit obligation:
Beginning of year		$	367,619			$	58,210			$	293,912			$	52,182
Service cost			2,462				1,006				2,218				897
Interest cost			13,142				1,444				12,875				1,837
Actuarial (gain) loss			(13,221	)			7,498				72,596				8,975
Benefits paid			(18,885	)			(859	)			(13,982	)			(1,265	)
Curtailment			—				(634	)			—				—
Plan participants’ contributions			—				64				—				88
Non-U.S. currency movement			—				(4,439	)			—				(4,504	)
End of year			351,117				62,290				367,619				58,210
Change in plan assets:
Fair value of plan assets:
Beginning of year			316,072				29,511				256,373				25,756
Company contributions			10,517				808				31,753				1,168
Plan participants’ contributions			—				64				—				88
Actual return on plan assets			(9,300	)			(136	)			41,928				5,192
Benefits paid			(18,885	)			(859	)			(13,982	)			(1,265	)
Admin expenses paid			—				(43	)			—				—
Non-U.S. currency movement			—				(1,204	)			—				(1,428	)
End of year			298,404				28,141				316,072				29,511
Funded status		$	(52,713	)		$	(34,149	)		$	(51,547	)		$	(28,699	)

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:

		2015								2014
		United States				Foreign				United States				Foreign
		(in thousands)
Retirement plans assets		$	636			$	—			$	3,090			$	9,806
Accrued employees’ compensation and withholdings			(2,564	)			(695	)			(2,492	)			(906	)
Retirement plans liabilities			(50,785	)			(33,454	)			(52,145	)			(37,599	)
Funded status		$	(52,713	)		$	(34,149	)		$	(51,547	)		$	(28,699	)

Amounts Recognized in Accumulated Other Comprehensive Income

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

		2015								2014
		United States				Foreign				United States				Foreign
		(in thousands)
Prior service cost, before tax		$	224			$	—			$	358			$	—
Deferred taxes			479				—				429				—
Total recognized in other comprehensive income, net of tax		$	703			$	—			$	787			$	—

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:

		2015								2014
		United States				Foreign				United States				Foreign
		(in millions)
Projected benefit obligation		$	53.3			$	35.2			$	54.6			$	39.5
Accumulated benefit obligation			47.3				29.5				48.5				32.7
Fair value of plan assets			—				1.0				—				1.0

Net Periodic Pension and Postretirement Benefit Costs

For the years ended December 31, 2015, 2014 and 2013, Teradyne’s net periodic pension cost (income) was comprised of the following:

		2015								2014								2013
		United States				Foreign				United States				Foreign				United States				Foreign
		(in thousands)
Components of Net Periodic Pension Cost (Income):
Service cost		$	2,462			$	1,006			$	2,218			$	897			$	2,393			$	1,034
Interest cost			13,142				1,444				12,875				1,837				11,318				1,948
Expected return on plan assets			(14,517	)			(781	)			(12,500	)			(868	)			(13,632	)			(959	)
Amortization of prior service cost			134				—				135				—				164				—
Net actuarial loss (gain)			10,596				8,415				43,168				4,651				(7,063	)			(1,252	)
Curtailment			—				(634	)			—				—				—				—
Total net periodic pension cost (income)		$	11,817			$	9,450			$	45,896			$	6,517			$	(6,820	)		$	771
Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income:
Reversal of amortization items:
Prior service cost			(134	)			—				(135	)			—				(164	)			—
Total recognized in other comprehensive income			(134	)			—				(135	)			—				(164	)			—
Total recognized in net periodic pension cost (income) and other comprehensive income		$	11,683			$	9,450			$	45,761			$	6,517			$	(6,984	)		$	771

Weighted Average Assumptions to Determine Net Periodic Cost and Benefit Obligation

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

		2015								2014								2013
		United States				Foreign				United States				Foreign				United States				Foreign
Discount rate			3.7	%			2.6	%			4.5	%			3.8	%			3.6	%			3.7	%
Expected return on plan assets			4.8				2.6				5.0				3.4				5.0				3.7
Salary progression rate			2.9				3.2				3.0				3.5				3.0				3.5

Weighted Average Assumptions to Determine Pension Obligations at December 31:

		2015								2014
		United States				Foreign				United States				Foreign
Discount rate			4.0	%			2.3	%			3.7	%			2.6	%
Salary progression rate			2.7				3.2				2.9				3.2

Weighted Average Pension Asset Allocations by Category

Teradyne’s weighted average pension asset allocation at December 31, 2015 and 2014, by asset category is as follows:

		2015								2014
		United States				Foreign				United States				Foreign
Fixed income securities			88.6	%			—	%			83.3	%			77.3	%
Equity securities			9.8				—				15.4				19.0
Other			1.6				100.0				1.3				3.7
			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
U.S. corporate fixed income		Barclays U.S. Corporate A or Better Index			76	%
Global equity		MSCI World Minimum Volatility Index			10
U.S. government fixed income		Barclays U.S. Long Government Bond Index			8
High yield fixed income		Barclays U.S. Corporate High Yield 2% Issuer Cap Index			5
Cash		Citigroup Three Month U.S. Treasury Bill Index			1

Changes in Fair Value of Pension Assets

The fair value of pension plan assets by asset category and by level at December 31, 2015 and December 31, 2014 were as follows:

		December 31, 2015
		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		$	—			$	240,695			$	—			$	240,695			$	—			$	—			$	—			$	—
U.S. government securities			—				23,761				—				23,761				—				—				—				—
Global equity			—				29,193				—				29,193				—				—				—				—
Group annuity insurance contracts			—				—				2,982				2,982				—				—				26,410				26,410
Other			—				—				—				—				—				1,029				—				1,029
Cash and cash equivalents			1,773				—				—				1,773				702				—				—				702
Total		$	1,773			$	293,649			$	2,982			$	298,404			$	702			$	1,029			$	26,410			$	28,141
		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
Group annuity insurance contracts			—				—				2,990				2,990				—				—				—				—
Other			—				65				—				65				—				957				—				957
Cash and cash equivalents			1,098				—				—				1,098				133				—				—				133
Total		$	1,098			$	311,984			$	2,990			$	316,072			$	133			$	29,378			$	—			$	29,511

Expected Future Benefit Payments

Future benefit payments are expected to be paid as follows:

		United States				Foreign
		(in thousands)
2016		$	19,696			$	1,062
2017			18,346				1,032
2018			18,836				1,021
2019			19,453				1,477
2020			20,129				1,266
2021-2025			109,860				8,561

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:

		2015				2014
		(in thousands)
Assets and Obligations
Change in benefit obligation:
Projected benefit obligation:
Beginning of year		$	7,162			$	9,019
Service cost			48				59
Interest cost			237				335
Actuarial (gain) loss			(648	)			(1,255	)
Benefits paid			(769	)			(996	)
End of year			6,030				7,162
Change in plan assets:
Fair value of plan assets:
Beginning of year			—				—
Company contributions			769				996
Benefits paid			(769	)			(996	)
End of year			—				—
Funded status		$	(6,030	)		$	(7,162	)

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:

		2015				2014
		(in thousands)
Accrued employees’ compensation and withholdings		$	(692	)		$	(780	)
Retirement plans liability			(5,338	)			(6,382	)
Funded status		$	(6,030	)		$	(7,162	)

Amounts Recognized in Accumulated Other Comprehensive Income

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

		2015				2014
		(in thousands)
Prior service credit, before tax		$	(1,632	)		$	(2,230	)
Deferred taxes			(1,100	)			(882	)
Total recognized in other comprehensive income, net of tax		$	(2,732	)		$	(3,112	)

Net Periodic Pension and Postretirement Benefit Costs

For the years ended December 31, 2015, 2014 and 2013, Teradyne’s net periodic postretirement benefit income was comprised of the following:

		2015				2014				2013
		(in thousands)
Components of Net Periodic Postretirement Benefit Income:
Service cost		$	48			$	59			$	75
Interest cost			237				335				342
Amortization of prior service credit			(598	)			(598	)			(598	)
Net actuarial gain			(648	)			(1,255	)			(2,025	)
Total net periodic postretirement benefit income			(961	)			(1,459	)			(2,206	)
Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income:
Reversal of amortization items:
Prior service credit			598				598				598
Total recognized in other comprehensive income			598				598				598
Total recognized in net periodic postretirement benefit income and other comprehensive income		$	(363	)		$	(861	)		$	(1,608	)

Weighted Average Assumptions to Determine Net Periodic Cost and Benefit Obligation

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

		2015				2014				2013
Discount rate			3.5	%			4.1	%			3.1	%
Initial health care cost trend rate			7.5				8.0				8.5
Ultimate health care cost trend rate			5.0				5.0				5.0
Year in which ultimate health care cost trend rate is reached			2022				2020				2020

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

		2015				2014				2013
Discount rate			3.9	%			3.5	%			4.1	%
Initial medical trend			7.5				7.5				8.0
Ultimate health care trend			5.0				5.0				5.0
Medical cost trend rate decrease to ultimate rate in year			2023				2022				2020

Expected Future Benefit Payments

Future benefit payments are expected to be paid as follows:

		Benefit Payments
		(in thousands)
2016		$	692
2017			587
2018			553
2019			492
2020			410
2021-2025			1,654

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, 2015, would have the following effects:

		1 Percentage Point Increase				1 Percentage Point Decrease
		(in thousands)
Effect on total service and interest cost components		$	3			$	(2	)
Effect on postretirement benefit obligations			59				(56	)

Group Annuity Insurance Contracts

Changes in Fair Value of Pension Assets

The table below indicates the change in value related to these level 3 assets during 2015 and 2014:

		Group Annuity Insurance Contracts
		(in thousands)
Balance at December 31, 2013		$	2,985
Interest and market value adjustments			152
Benefits paid			(125	)
Other			(22	)
Balance at December 31, 2014		$	2,990
Purchases of group annuity insurance contracts			27,313
Interest and market value adjustments			(825	)
Benefits paid			(67	)
Other			(19	)
Balance at December 31, 2015		$	29,392

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