Teradyne makes automated test equipment (ATE) — machines that test semiconductors and electronics to verify they work correctly before shipping. Testing is non-negotiable for chip manufacturers, as defective chips in data centers or vehicles can cause serious failures, so virtually all chips must be tested. Semiconductor Test is the core business, accounting for roughly 80% of revenue, with flagship platforms including the UltraFLEXplus for high-complexity compute and networking chips, the FLEX/J750 for high-volume consumer and mobile devices, Magnum for memory (DRAM, HBM, flash), and ETS/Eagle for analog and power semiconductors. Teradyne sells to IDMs, fabless chip designers, foundries, and OSATs. Revenue is driven by chip complexity growth, unit volumes, and the number of test insertions per chip — all of which expand as AI accelerators and HBM demand more rigorous testing. The business has high operating leverage, with gross margins around 58-60%. The most important recent shift is the pivot toward AI compute: by 2025, compute had grown to nearly 50% of SoC revenue, and AI-driven revenue exceeded 60% of total company revenue in Q4 2025. Teradyne also operates a Product Test segment (~10% of revenue) covering board test, wireless test, and defense instrumentation, and a Robotics segment (~10%) through Universal Robots (cobots) and Mobile Industrial Robots (AMRs), the latter currently near breakeven. Teradyne returns substantially all free cash flow to shareholders through buybacks and dividends, supplemented by selective acquisitions to expand into adjacent test markets.