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Teradyne stock popped on Tuesday after the company beat fourth-quarter estimates thanks to strong artificial intelligence demand.
The robotics company reported adjusted earnings of $1.80 per share, exceeding the $1.37 per share expected by analysts surveyed by LSEG. Revenue totaled $1.08 billion, topping a forecast of $973 million.
Teradyne’s fourth-quarter revenue was up 44% compared to a year ago.
On the earnings call with analysts, CEO Greg Smith said that AI drove more than 60% of Teradyne’s revenue in the fourth quarter. He said the company expects that to be upwards of 70% next quarter.
The company attributed its Q4 growth to “strong AI-related demand in compute and memory” and issued strong guidance.
“In 2026, we expect year-over-year growth across all of our businesses, with strong momentum in compute driven by AI,” the company said in a press release on Monday.
Teradyne said it anticipates first-quarter adjusted earnings per share to be between $1.89 and $2.26, far above LSEG estimates of $1.26.
First-quarter revenue is expected to fall between $1.15 billion and $1.25 billion, again exceeding LSEG expectations of $935 million.
Net income for the fourth quarter was $257.2 million, or $1.63 per diluted share. Net income a year ago was $146.3 million, or 90 cents per share.
The company said earnings adjustments were made for “acquired intangible asset amortization, restructuring and other charges and pension mark-to-market adjustment.”
The AI blitz has hit every tech sector, and the latest earnings reports show the cascading effects of chip demand.
Smith said on the earnings call that data centers were “the prime mover of the market.”
In 2025, data center deals hit a record $61 billion, according to S&P Global.
Memory maker Sandisk shares soared after its second-quarter earnings last week, reporting 64% growth in its data center business specifically.
Apple CEO Tim Cook said last week that the company would see a hit from rising memory prices, but the iPhone maker was currently dealing with a limited supply of advanced node chips.
“At this time, we’re seeing less flexibility in supply chain than normal, partly because of our increased demand,” Cook said.
Teradyne one-day stock chart
