Teradyne: Color on Quarter (41.50)
- Needham notes that Following earnings reports by TSM, ams AG & Hynix [all N/R] suggesting near-term softness in smartphone demand, they heard increased investor concern over TER's large exposure to mobile SoC space. The company's 1Q18 report confirmed what others have been suggesting, as the weakening of smartphone demand substantially hurt TER's Semi Test business, resulting in 2Q18 guidance sharply below the consensus estimate, which had modeled for a seasonal jump in mobile SoC ATE demand. They believe the demand outside of smartphones remains relatively healthy, and as a result, they expect mgmt to provide more upbeat commentary on this morning's earnings call, particularly around its 2H18 outlook. We believe even the most upbeat comments will not prevent the stock from opening firmly lower this morning, but they expect the stock to somewhat recover as investors digest the news and look forward to solid growth in UR and other parts of TER's business.
- Stifel notes Teradyne (TER, Buy, $41.50) reported 1Q18 (March) earnings results of $487.5 million in revenue and pro-forma EPS of $0.45, including options, above our estimates of $474.6 million and $0.41, respectively (they will update their excluding options results following the call). While the co continues to show steady growth in its robotics business, their concerns over the Apple processor test business were validated but to a much larger-than-expected degree vs. their cautious preview. Because of softness in the Apple processor test business, the June quarter outlook came in significantly below their expectations and is likely to put pressure on the stock on Wednesday.
- TER call starts at 8:00
- TER down 11% premarket.