TER Gains From Strong Semiconductor Test Segment: More Upside Ahead?

AAPL TSLA AMZN META AMD NVDA PEP COST ADBE GOOG AMGN HON INTC INTU NFLX ADP SBUX MRNA AAPL TSLA AMZN META AMD NVDA PEP COST ADBE GOOG AMGN HON INTC INTU NFLX ADP SBUX MRNA AAPL TSLA AMZN META AMD NVDA PEP COST ADBE GOOG AMGN HON INTC INTU NFLX ADP SBUX MRNA Stocks TER Gains From Strong Semiconductor Test Segment: More Upside Ahead? December 11, 2025 — 10:35 am EST Written by Zacks Equity Research for Zacks-> Teradyne TER is experiencing strong growth in its semiconductor test segment. In the third quarter of 2025, Semiconductor Test revenues rose 7% year over year and 23% sequentially, accounting for 78.8% of sales in the reported quarter.This growth can be attributed to the rising demand for AI-related products. Customers are increasing their investments in cloud AI infrastructure and speeding up production of various AI accelerators, networking devices, memory, and power devices. Teradyne’s UltraFLEXplus system, designed for high-performance processors and networking devices, has proven to be a key catalyst in meeting the demanding requirements of AI devices, such as power, pin count, and test data.This surge in demand was further supported by AI-driven advancements, particularly in AI accelerator Application-Specific Integrated Circuits, networking, and high-bandwidth memory (HBM) and Dynamic Random-Access Memory (DRAM), which significantly boosted the need for test equipment. Memory test sales contributed significantly to growth of the Semiconductor Test segment. In the third quarter of 2025, memory test revenue more than doubled sequentially, reaching $128 million, with 75% of revenues driven by DRAM and 25% by flash memory for cloud SSD applications. The demand for DRAM was primarily fueled by final tests of DRAM and HBM performance tests, which are critical for AI applications.For the fourth quarter of 2025, Teradyne expects revenues between $920 million and $1 billion, driven by strong AI-related demand in compute, networking, and memory segments.Teradyne Suffers From Stiff CompetitionTeradyne is facing stiff competition in the semiconductor test market from companies such as Advantest Corporation ATEYY and Cohu COHU.Advantest is expanding its footprint in the semiconductor test market by focusing on the growing demand for AI-related high-performance semiconductors, such as high-performance computing devices and high-performance DRAM for data centers. In the second quarter of 2025, Advantest significantly increased sales of SoC and Memory Test Systems, driven by the growing complexity and enhanced performance of semiconductors.Cohu’s expanding portfolio has been noteworthy. In September, Cohu announced that a major U.S. semiconductor manufacturer and foundry services company chose its Eclipse platform for production testing of next-generation processors. The Eclipse systems feature Cohu’s T-Core Active Thermal Control, which offers precise thermal management up to 3kW dissipation with fast ramp rates. This improves yield and test repeatability. This scalable platform supports a variety of high-performance devices while lowering the total cost of ownership for IDMs, foundries, and OSATs. TER’s Share Price Performance, Valuation, and EstimatesTeradyne shares have surged 137.5% in the trailing six-month period, outperforming the Zacks Computer & Technology sector’s rise of 26.3% and the Zacks Electronics - Miscellaneous Products increase of 24.7%.TER Stock PerformanceImage Source: Zacks Investment ResearchTER stock is trading at a premium with a forward 12-month Price/Sales of 8.68X compared with the Electronics - Miscellaneous Products industry’s 6.99X. TER has a Value Score of D.Price/Sales (F12M)Image Source: Zacks Investment ResearchThe consensus mark for fiscal 2026 earnings is pegged at $3.51 per share, which has increased 1.44% over the past 30 days. This suggests 9.01% year-over-year growth. Teradyne, Inc. Price and Consensus Teradyne, Inc. price-consensus-chart | Teradyne, Inc. QuoteTeradyne currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Free Report: Profiting from the 2nd Wave of AI Explosion The next phase of the AI explosion is poised to create significant wealth for investors, especially those who get in early. It will add literally trillion of dollars to the economy and revolutionize nearly every part of our lives. Investors who bought shares like Nvidia at the right time have had a shot at huge gains. But the rocket ride in the "first wave" of AI stocks may soon come to an end. The sharp upward trajectory of these stocks will begin to level off, leaving exponential growth to a new wave of cutting-edge companies. Zacks' AI Boom 2.0: The Second Wave report reveals 4 under-the-radar companies that may soon be shining stars of AI’s next leap forward.Access AI Boom 2.0 now, absolutely free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free reportCohu, Inc. (COHU) : Free Stock Analysis ReportTeradyne, Inc. (TER) : Free Stock Analysis ReportAdvantest Corp. (ATEYY) : Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment Research The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Tags StocksInvesting Zacks Zacks is the leading investment research firm focusing on stock research, analysis and recommendations. In 1978, our founder discovered the power of earnings estimate revisions to enable profitable investment decisions. Today, that discovery is still the heart of the Zacks Rank. A wealth of resources for individual investors is available at www.zacks.com. More articles by this source-> Stocks mentioned COHU TER ATEYY More Related Articles This data feed is not available at this time. Data is currently not available • Sign up for the TradeTalks newsletter to receive your weekly dose of trading news, trends and education. Delivered Wednesdays.