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Retirement Plans (Tables)

12 Months Ended

Dec. 31, 2020

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:

		2020								2019
		United States				Foreign				United States				Foreign
		(in thousands)
Assets and Obligations
Change in benefit obligation:
Projected benefit obligation:
Beginning of year		$	203,791			$	43,952			$	178,237			$	39,146
Service cost			1,773				907				1,608				751
Interest cost			5,770				516				7,189				691
Actuarial loss			24,671				2,951				24,447				4,520
Benefits paid			(9,844	)			(1,299	)			(7,690	)			(836	)
Retiree annuity purchase			(24,379	)			—				—				—
Liability loss due to settlement			451				—				—				—
Non-U.S. currency movement			—				3,961				—				(320	)
End of year			202,233				50,988				203,791				43,952
Change in plan assets:
Fair value of plan assets:
Beginning of year			166,932				1,586				144,301				1,400
Actual return on plan assets			23,048				67				27,516				64
Company contributions			3,098				1,079				2,805				923
Benefits paid			(9,844	)			(988	)			(7,690	)			(836	)
Retiree annuity purchase			(24,379	)			—				—				—
Non-U.S. currency movement			—				112				—				35
End of year			158,855				1,856				166,932				1,586
Funded status		$	(43,378	)		$	(49,132	)		$	(36,859	)		$	(42,366	)

Amounts Recorded within Statement of Financial Position

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

		2020								2019
		United States				Foreign				United States				Foreign
		(in thousands)
Retirement plans assets		$	17,468			$	—			$	18,457			$	—
Accrued employees’ compensation and withholdings			(3,273	)			(1,019	)			(2,826	)			(922	)
Retirement plans liabilities			(57,573	)			(48,113	)			(52,490	)			(41,444	)
Funded status		$	(43,378	)		$	(49,132	)		$	(36,859	)		$	(42,366	)

Amounts Recognized in Accumulated Other Comprehensive Income

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

		2020								2019
		United States				Foreign				United States				Foreign
		(in thousands)
Deferred taxes related to prior service cost recognized in other comprehensive income		$	560			$	—			$	560			$	—

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:

		2020								2019
		United States				Foreign				United States				Foreign
		(in millions)
Projected benefit obligation		$	60.8			$	51.0			$	55.3			$	44.0
Accumulated benefit obligation			58.5				46.5				53.2				39.9
Fair value of plan assets			—				1.9				—				1.6

Net Periodic Pension and Postretirement Benefit Costs

For the years ended December 31, 2020, 2019, and 2018, Teradyne’s net periodic pension cost (income) was comprised of the following:

		2020								2019								2018
		United States				Foreign				United States				Foreign				United States				Foreign
		(in thousands)
Components of Net Periodic Pension Cost (Income):
Service cost		$	1,773			$	907			$	1,608			$	751			$	2,196			$	786
Interest cost			5,770				516				7,189				691				8,940				687
Expected return on plan assets			(4,840	)			(65	)			(6,042	)			(29	)			(9,049	)			(19	)
Amortization of prior service cost			—				—				—				—				58				—
Net actuarial loss (gain)			6,463				2,949				2,973				4,485				(4,429	)			743
Settlement loss			451				—				—				—				345				—
Total net periodic pension cost (income)		$	9,617			$	4,307			$	5,728			$	5,898			$	(1,939	)		$	2,197
Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income:
Reversal of amortization items:
Prior service cost			—				—				—				—				(58	)			—
Total recognized in other comprehensive income			—				—				—				—				(58	)			—
Total recognized in net periodic pension cost (income) and other comprehensive income		$	9,617			$	4,307			$	5,728			$	5,898			$	(1,997	)		$	2,197

Weighted Average Assumptions to Determine Net Periodic Cost and Benefit Obligation

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

		2020								2019								2018
		United States				Foreign				United States				Foreign				United States				Foreign
Discount rate			2.8	%			1.1	%			4.1	%			1.8	%			3.4	%			1.8	%
Expected return on plan assets			3.0				3.8				4.3				2.0				4.3				1.5
Salary progression rate			2.6				2.5				2.3				2.5				2.3				2.7

Weighted Average Assumptions to Determine Pension Obligations at December 31:

		2020								2019
		United States				Foreign				United States				Foreign
Discount rate			2.2	%			0.7	%			3.0	%			1.1	%
Salary progression rate			2.4				2.3				2.6				2.5

Weighted Average Pension Asset Allocations by Category

The following table provides weighted average pension asset allocation by asset category at December 31, 2020 and 2019:

		2020								2019
		United States				Foreign				United States				Foreign
Fixed income securities			94.0	%			—	%			94.0	%			—	%
Equity securities			5.0				—				5.0				—
Other			1.0				100.0				1.0				100.0
			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		Bloomberg Barclays U.S. Corporate A or Better Index			75	%
Global equity		MSCI World Minimum Volatility Index			5
U.S. government fixed income		Bloomberg Barclays U.S. Long Government Bond Index			14
High yield fixed income		Bloomberg 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, 2020 and December 31, 2019 were as follows:

		December 31, 2020
		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		$	—			$	127,098			$	—			$	127,098			$	—			$	—			$	—			$	—
U.S. government securities			—				22,250				—				22,250				—				—				—				—
Global equity			—				7,925				—				7,925				—				—				—				—
Other			—				—				—				—				—				1,856				—				1,856
Cash and cash equivalents			1,582				—				—				1,582				—				—				—				—
Total		$	1,582			$	157,273			$	—			$	158,855			$	—			$	1,856			$	—			$	1,856

		December 31, 2019
		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		$	—			$	133,792			$	—			$	133,792			$	—			$	—			$	—			$	—
U.S. government securities			—				23,186				—				23,186				—				—				—				—
Global equity			—				8,344				—				8,344				—				—				—				—
Other			—				—				—				—				—				1,586				—				1,586
Cash and cash equivalents			1,610				—				—				1,610				—				—				—				—
Total		$	1,610			$	165,322			$	—			$	166,932			$	—			$	1,586			$	—			$	1,586

Expected Future Benefit Payments

Future benefit payments are expected to be paid as follows:

		United States				Foreign
		(in thousands)
2021		$	8,902			$	1,058
2022			8,782				1,063
2023			9,189				1,313
2024			9,815				1,192
2025			10,374				1,140
2026-2030			54,145				7,053

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:

		2020				2019
		(in thousands)
Assets and Obligations
Change in benefit obligation:
Projected benefit obligation:
Beginning of year		$	9,003			$	9,256
Service cost			57				41
Interest cost			240				347
Actuarial loss			421				717
Benefits paid			(1,205	)			(1,358	)
End of year			8,515				9,003
Change in plan assets:
Fair value of plan assets:
Beginning of year			—				—
Company contributions			1,205				1,358
Benefits paid			(1,205	)			(1,358	)
End of year			—				—
Funded status		$	(8,515	)		$	(9,003	)

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:

		2020				2019
		(in thousands)
Accrued employees’ compensation and withholdings		$	(1,161	)		$	(1,231	)
Retirement plans liability			(7,354	)			(7,772	)
Funded status		$	(8,515	)		$	(9,003	)

Amounts Recognized in Accumulated Other Comprehensive Income

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

		2020				2019
		(in thousands)
Prior service credit, before tax		$	(49	)		$	(58	)
Deferred taxes			(1,686	)			(1,684	)
Total recognized in other comprehensive income, net of tax		$	(1,735	)		$	(1,742	)

Net Periodic Pension and Postretirement Benefit Costs

For the years ended December 31, 2020, 2019, and 2018, Teradyne’s net periodic postretirement benefit cost (income) was comprised of the following:

		2020				2019				2018
		(in thousands)
Components of Net Periodic Postretirement Benefit Cost (income):
Service cost		$	57			$	41			$	39
Interest cost			240				347				196
Amortization of prior service credit			(9	)			(191	)			(373	)
Net actuarial loss			421				717				25
Special termination benefits			—				—				3,708
Total net periodic postretirement benefit cost			709				914				3,595
Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income:
Reversal of amortization items:
Prior service credit			9				191				373
Total recognized in other comprehensive income			9				191				373
Total recognized in net periodic postretirement cost and other comprehensive income		$	718			$	1,105			$	3,968

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:

		2020				2019				2018
Discount rate			3.0	%			4.0	%			3.4	%
Initial health care cost trend rate			7.1				7.5				7.9
Ultimate health care cost trend rate			4.5				4.5				4.5
Year in which ultimate health care cost trend rate is reached			2026				2026				2026

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

		2020				2019				2018
Discount rate			2.2	%			3.0	%			4.0	%
Initial medical trend			7.3				7.1				7.5
Ultimate health care trend			4.5				4.5				4.5
Medical cost trend rate decrease to ultimate rate in year			2029				2026				2026

Expected Future Benefit Payments

Future benefit payments are expected to be paid as follows:

		Benefit Payments
		(in thousands)
2021		$	1,161
2022			961
2023			786
2024			646
2025			533
2026-2030			1,601

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