BOSTON, Oct. 21 -- Third-quarter revenues at Teradyne rose 39% yet the semiconducter gear maker warned of slowing demand ahead as customers "sharply lowered their capital spending."  The company said restructuring moves have already begun in anticipation of lower fourth quarter sales.

"The major factor is industry wide excess inventory," chief executive Mike Bradley told analysts on the company's quarterly conference call. "Inventory levels have risen and triggered broad curtailment in test capacity spending."

The company will take $3.1 million restructuring charge as it tries to pare $20 million from its quarterly overheard. The company shaved 169 jobs during the third quarter and into the fourth.

"The program going forward will be made up of a lot of very detailed changes across the business of semi test and significant changes outside of semi test," said chief financial officer Greg Beecher.

For the quarter ended Oct. 3, Teradyne reported net income of $41.1 million on sales of $457.8 million. Teradyne lost $53.5 million on sales of $329.2 million last year.

The slump came in net orders, which were off 49% sequentially and 16% year-on-year, at $284 million. Gross margins slipped to 41.2% from 43% sequentially and are expected to drop another four points in the January quarter.

Teradyne guided for Q4 sales of $360 million to $380 million and earnings of breakeven to a slight profit.