XML 36 R28.htm IDEA: XBRL DOCUMENT v3.24.2.u1
Retirement Plans
 6 Months Ended
Jun. 30, 2024
Retirement Plans

Q. RETIREMENT PLANS

ASC 715, “Compensation—Retirement Benefits,” requires an employer with defined benefit plans or other postretirement benefit plans to recognize an asset or a liability on its balance sheet for the overfunded or underfunded status of the plans as defined by

ASC 715. The pension asset or liability represents a difference between the fair value of the pension plan’s assets and the projected benefit obligation at December 31. Teradyne uses a December 31 measurement date for all its plans.

Defined Benefit Pension Plans

Teradyne has defined benefit pension plans covering a portion of domestic employees and employees of certain non-U.S. subsidiaries. Benefits under these plans are based on employees’ years of service and compensation. Teradyne’s funding policy is to make contributions to these plans in accordance with local laws and to the extent that such contributions are tax deductible. The assets of the U.S. qualified pension plan consist primarily of fixed income and equity securities. In addition, Teradyne has an unfunded supplemental executive defined benefit plan in the United States to provide retirement benefits in excess of levels allowed by the Employment Retirement Income Security Act (“ERISA”) and the Internal Revenue Code (the “IRC”), as well as unfunded qualified foreign plans.

In the six months ended June 30, 2024, and July 2, 2023, Teradyne contributed $1.6 million and $1.5 million, respectively, to the U.S. supplemental executive defined benefit pension plan, and $0.5 million and $0.6 million, respectively, to certain qualified pension plans for non-U.S. subsidiaries.

For the three and six months ended June 30, 2024, and July 2, 2023, Teradyne’s net periodic pension cost was comprised of the following:

 

 

 

For the Three Months Ended

 

 

 

June 30, 2024

 

 

July 2, 2023

 

 

 

United
States

 

 

Foreign

 

 

United
States

 

 

Foreign

 

 

 

(in thousands)

 

Service cost

 

$

217

 

 

$

114

 

 

$

272

 

 

$

110

 

Interest cost

 

 

1,646

 

 

 

243

 

 

 

1,714

 

 

 

263

 

Expected return on plan assets

 

 

(1,265

)

 

 

(18

)

 

 

(1,286

)

 

 

(9

)

Net actuarial loss (gain)

 

 

111

 

 

 

(242

)

 

 

24

 

 

 

—

 

Settlement loss (gain)

 

 

—

 

 

 

(24

)

 

 

—

 

 

 

—

 

Total net periodic pension cost

 

$

709

 

 

$

73

 

 

$

724

 

 

$

364

 

 

 

 

For the Six Months Ended

 

 

 

June 30, 2024

 

 

July 2, 2023

 

 

 

United
States

 

 

Foreign

 

 

United
States

 

 

Foreign

 

 

 

(in thousands)

 

Service cost

 

$

448

 

 

$

231

 

 

$

543

 

 

$

220

 

Interest cost

 

 

3,293

 

 

 

489

 

 

 

3,425

 

 

 

526

 

Expected return on plan assets

 

 

(2,533

)

 

 

(34

)

 

 

(2,571

)

 

 

(18

)

Net actuarial loss (gain)

 

 

111

 

 

 

(242

)

 

 

24

 

 

 

—

 

Settlement loss (gain)

 

 

—

 

 

 

(24

)

 

 

—

 

 

 

—

 

Total net periodic pension cost

 

$

1,319

 

 

$

420

 

 

$

1,421

 

 

$

728

 

 

Postretirement Benefit Plan

In addition to receiving pension benefits, Teradyne employees in the United States who meet early retirement eligibility requirements as of their termination dates may participate in Teradyne’s Welfare Plan, which includes medical and dental benefits up to age 65. Death benefits provide a fixed sum to retirees’ survivors and are available to all retirees. Substantially all of Teradyne’s current U.S. employees could become eligible for these benefits and the existing benefit obligation relates predominantly to those employees. During the three and six months ended June 30, 2024, Teradyne recorded special termination benefit charges associated with a voluntary early retirement program.

For the three and six months ended June 30, 2024, and July 2, 2023, Teradyne’s net periodic postretirement benefit cost was comprised of the following:

 

 

 

For the Three Months
 Ended

 

 

For the Six Months
 Ended

 

 

 

June 30,
2024

 

 

July 2,
2023

 

 

June 30,
2024

 

 

July 2,
2023

 

 

 

(in thousands)

 

 

(in thousands)

 

Service cost

 

$

9

 

 

$

8

 

 

$

18

 

 

$

17

 

Interest cost

 

 

72

 

 

 

60

 

 

 

145

 

 

 

121

 

Amortization of prior service credit

 

 

(2

)

 

 

(2

)

 

 

(4

)

 

 

(4

)

Special termination benefits

 

 

170

 

 

 

369

 

 

 

462

 

 

 

369

 

Net actuarial loss (gain)

 

 

(94

)

 

 

30

 

 

 

(94

)

 

 

30

 

Total net periodic postretirement benefit cost

 

$

155

 

 

$

465

 

 

$

527

 

 

$

533