Is TER (Teradyne, Inc.) Halal or Haram?

Based on our AAOIFI-standard shariah screening, TER is Halal and considered permissible for Muslim investors. It passed all 4 of 4 compliance screens including business activity review, debt-to-market-cap ratio (0.58% vs ≤33% threshold), interest income ratio (0.59% vs ≤5% threshold), and cash & securities ratio (0.54% vs ≤33% threshold).

Teradyne, Inc. is a global leader in designing and manufacturing automatic test equipment for the semiconductor industry. The company provides critical testing solutions like the FLEX and J750 platforms, ensuring the reliability of chips used in smartphones, automotive systems, and cloud computing. For Muslim investors, Teradyne represents a solid Halal investment opportunity within the technology sector. The stock successfully passes all four AAOIFI shariah screening criteria, meaning its core operations and financial structures align seamlessly with Islamic finance principles. Financially, Teradyne is highly attractive from a shariah compliance perspective due to its minimal reliance on leverage. Its debt-to-market capitalization sits at a remarkable 0.6%, while interest income accounts for merely 0.59% of total revenue, significantly minimizing any exposure to riba (usury). While the stock is currently fully compliant, halal investors should periodically monitor Teradyne's strategic acquisitions in the industrial automation space. Ensuring future subsidiaries avoid conventional debt financing will be key to maintaining its strong shariah-compliant status. Teradyne, Inc. operates in the Technology sector under the Semiconductors industry and is headquartered in North Reading, MA, US. The company is led by CEO Gregory Stephen Smith and employs approximately 6,500 people.

TER was screened using AAOIFI-based shariah compliance criteria. Four tests are applied: (1) Business Activity — the company's core business must not derive primary income from haram (prohibited) activities such as alcohol, gambling, tobacco, or interest-based finance. (2) Debt-to-Market-Cap — total debt must not exceed 33% of market capitalization. (3) Interest Income — interest income must not exceed 5% of total revenue. (4) Cash & Securities — cash and interest-bearing securities must not exceed 33% of market cap. TER passed 4 of these 4 screens.

Although TER passes all shariah screens, it does earn $18.9M in interest income (0.59% of revenue). Many scholars recommend purifying this portion by donating the equivalent percentage of any dividends received to charity. For example, if you receive $100 in dividends, you would donate approximately $0.59 to purify the income.

TER was last screened on 2026-04-29. Shariah compliance status can change as companies report new financial data, acquire new businesses, or shift revenue streams. We recommend checking back periodically for the most up-to-date screening results.