Dolby's Q4 Earnings & Revenues Surpass Estimates, Increase Y/Y

Core Insights - Dolby Laboratories, Inc. (DLB) reported strong fourth-quarter fiscal 2025 results, with non-GAAP earnings per share (EPS) of 99 cents, exceeding the Zacks Consensus Estimate of 70 cents and up from 81 cents in the prior-year quarter [1] - Total revenues reached $307 million, slightly up from $304.8 million year-over-year, and surpassed the Zacks Consensus Estimate by 0.5%, driven by growth in the Product and Services segment [1][4] Financial Performance - Licensing revenues were $281.6 million, a decrease of 0.4% year-over-year, aligning with company guidance of $263 million to $293 million [4] - Products and Services revenues increased by 14.9% year-over-year to $25.4 million, exceeding estimates [4] - Gross profit for the quarter was $267.5 million, down from $270.8 million in the previous year, while total operating expenses rose to $237.8 million from $224.5 million [6] Market and Strategic Developments - The company closed fiscal 2025 with growth in Dolby Atmos, Dolby Vision, and imaging patents, expanding its addressable market through Dolby OptiView and a new imaging patent pool for content streaming [2] - Dolby's fiscal 2026 outlook indicates confidence in driving business growth by delivering value across existing and emerging ecosystems of creators, content distributors, and device manufacturers [2] Cash Flow and Shareholder Returns - For the fiscal year ended September 26, 2025, Dolby generated $472.2 million in net cash from operating activities and had $701.9 million in cash and cash equivalents [10] - The company repurchased approximately 479,000 shares for about $35 million during the quarter and declared a cash dividend of 36 cents per share, payable on December 10, 2025 [11] Future Outlook - For the first quarter of fiscal 2026, Dolby estimates revenues between $315 million and $345 million, projecting a decline of about 8% year-over-year at the midpoint [12] - The company expects full-year revenues for fiscal 2026 to be in the range of $1.39 billion to $1.44 billion, up from $1.35 billion in fiscal 2025 [13] - Licensing revenues are projected to range from $1.285 billion to $1.335 billion, with expectations of growth in Other markets and declines in Consumer Electronics and PC [14]