Teradyne $TER ( ▲ 12.15% ) is ripping higher after delivering a monster quarter and an even stronger outlook. The chip-testing equipment maker surged in premarket trading after smashing revenue and earnings expectations and forecasting a huge jump to start 2026.
This was not a small beat. This was a full-blown flex.
AI Demand Is Powering the Test Boom
Teradyne reported fourth-quarter revenue of $1.083 billion, well above Wall Street’s $964 million forecast. Adjusted earnings per share came in at $1.80, blowing past the $1.36 analysts expected.
CEO Greg Smith credited “AI-related demand in compute, networking and memory” for the surge, especially within the company’s semiconductor testing segment. All three major business lines — Semi Test, Product Test, and Robotics — posted sequential growth, showing the strength was broad, not just a one-off.
As AI data centers expand, every chip and component needs to be tested at higher performance levels. Teradyne sits right in the middle of that bottleneck.
Guidance Just Shocked Wall Street
If the past quarter was strong, the guidance really turned heads. For Q1 2026, Teradyne expects revenue between $1.15 billion and $1.25 billion, far above analyst estimates of $933 million. Adjusted EPS is projected between $1.89 and $2.25, compared with expectations of just $1.26.
That kind of upside surprise suggests AI infrastructure demand is not just holding up, it is accelerating.
Rising Tide for Chip Testers
Teradyne $TER ( ▲ 12.15% ) has already climbed 125% over the past year, riding the AI hardware boom. The company has been leaning even further into that trend, including a recent joint venture with high-speed test firm Multilane to support next-generation AI data center gear.
Rival chip-testing company Advantest $ATEYY also moved higher on the news, as investors bet the AI buildout will keep lifting the entire testing ecosystem.