Core Insights - Dolby Laboratories, Inc. (DLB) reported first-quarter fiscal 2026 non-GAAP earnings per share (EPS) of $1.06, exceeding the Zacks Consensus Estimate of 90 cents, but down from $1.14 in the prior-year quarter [1][9] - Total revenues were $346.7 million, a decrease from $357 million in the year-ago quarter, yet surpassing the Zacks Consensus Estimate by 4.2% [2][9] Financial Performance - Licensing revenues were $319.8 million, down 3.2% year over year, but within the company's guidance of $290 million to $320 million [5] - Products and Services revenues increased by 1.6% year over year to $26.9 million [5] - Gross profit for the fiscal first quarter was $303.5 million, compared to $316.2 million in the year-ago quarter, while total operating expenses rose to $241.3 million from $236.3 million [7] Market Outlook - Management expressed optimism about the company's market position and growth opportunities, citing strong momentum in Dolby Atmos and Dolby Vision, as well as an expanding addressable market [3] - For the second quarter of fiscal 2026, the company estimates revenues between $375 million and $405 million, with licensing revenues projected to be between $350 million and $380 million [12] Shareholder Returns - The company repurchased approximately 1 million shares for about $70 million during the first quarter, with roughly $207 million remaining under its stock repurchase authorization [11] - A cash dividend of 36 cents per share was declared, payable on February 18, 2026 [11] Segment Performance - Broadcast Licensing contributed 31% to total licensing revenues, while Mobile Licensing, Consumer Electronics, PC Licensing, and Licensing from Other Markets accounted for 23%, 14%, 9%, and 23% respectively [6] Future Projections - For fiscal 2026, the company expects total revenues to be in the range of $1.4 billion to $1.45 billion, an increase from the prior estimate of $1.39 billion to $1.44 billion [13] - Licensing revenues are projected to range from $1.295 billion to $1.345 billion, up from the previous estimate of $1.285 billion to $1.335 billion [13]

Financial Data and Key Metrics Changes - Revenue for Q1 2026 was $347 million, exceeding the high end of guidance, driven by earlier-than-expected deal closures and a $7 million favorable true-up for Q4 shipments [14][17] - Non-GAAP earnings per share was $1.06, also above guidance, attributed to higher revenue and lower operating expenses [14][17] - Operating cash flow generated was approximately $55 million, with $70 million of common stock repurchased [15][16] Business Line Data and Key Metrics Changes - Licensing revenue was $320 million, while product and services revenue was $27 million [14] - Mobile revenue grew over 20% year-over-year, while broadcast revenue declined in the mid-teens year-over-year [16] Market Data and Key Metrics Changes - The automotive sector is a major focus, with partnerships increasing from 20 OEMs last year to over 35 this year [7][12] - Dolby Vision 2 received positive feedback at CES, with support from content providers like Peacock and TP Vision [9][54] Company Strategy and Development Direction - The company is focused on expanding its presence in automotive entertainment and enhancing the in-car experience with Dolby Atmos and Dolby Vision [5][6] - Dolby Vision 2 aims to meet evolving viewer expectations and unlock the potential of modern televisions [8][9] - The company is confident in growing Dolby Atmos, Dolby Vision, and Imaging Patents at 15%-20% per year over the next few years [13] Management's Comments on Operating Environment and Future Outlook - Management noted that while some deals came in earlier than expected, it does not indicate a broader change in the macro environment [21] - The company raised its full-year revenue guidance to $1.4 billion-$1.45 billion, reflecting strong Q1 performance and true-up adjustments [17][19] - Management remains optimistic about growth opportunities despite potential impacts from memory pricing and macroeconomic factors [60][61] Other Important Information - A dividend of $0.36 was declared, representing a 9% increase from the previous year [16] - The company ended the quarter with cash and investments of approximately $730 million [16] Q&A Session Summary Question: Impact of deal timing on revenue - Management indicated that earlier deal closures de-risk the outlook for the year but do not suggest a general change in the macro environment [21] Question: Details on the $7 million true-up - The true-up was primarily in gaming and broadcast sectors [23] Question: Growth in mobile revenue - Mobile growth is influenced by the timing of new deals and renewals, with expectations for slight growth for the full year [24] Question: Update on patent monetization strategy - The company aims for 10% of revenue from content service providers within three years, with Roku as a significant new licensee [32] Question: Guidance for Q1 performance - The guidance was positively influenced by the $7 million true-up and earlier-than-expected deals [35][44] Question: Feedback from CES - The event showcased strong interest in automotive experiences and Dolby Vision 2, with positive responses from partners and customers [50][52]

Financial Data and Key Metrics Changes - Revenue for Q1 2026 was $347 million, exceeding the high end of guidance, driven by earlier-than-expected deal closures and a $7 million favorable true-up for Q4 shipments [14][17] - Non-GAAP earnings per share was $1.06, also above guidance, attributed to higher revenue and lower operating expenses [14][17] - Operating cash flow generated was approximately $55 million, with $70 million of common stock repurchased [15][16] Business Line Data and Key Metrics Changes - Licensing revenue reached $320 million, while product and services revenue was $27 million [14] - Mobile revenue grew over 20% year-over-year, while broadcast revenue declined in the mid-teens year-over-year [16] Market Data and Key Metrics Changes - The automotive sector is a major focus, with partnerships increasing from 20 OEMs to over 35 OEMs year-over-year [7] - Dolby Vision 2 received positive feedback at CES, with support from content providers like Peacock and TP Vision [9][53] Company Strategy and Development Direction - The company is raising its full-year fiscal 2026 revenue guidance to $1.4 billion-$1.45 billion, reflecting strong Q1 performance and earlier deal closures [17] - Dolby aims to grow Dolby Atmos, Dolby Vision, and imaging patents at 15%-20% per year, which now comprise nearly half of licensing revenue [13][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in growth opportunities despite macroeconomic uncertainties, noting that the timing of deals has improved [21][58] - The company is optimistic about the adoption of Dolby Vision 2 and the expansion of its addressable market through new partnerships and technologies [26][32] Other Important Information - A dividend of $0.36 was declared, representing a 9% increase from the previous year [16] - The company ended the quarter with cash and investments of approximately $730 million [16] Q&A Session Summary Question: Impact of deal timing on the environment - Management noted that while some deals came in earlier than expected, it should not be generalized to indicate a broader change in the macro environment [21] Question: Details on the large true-up - The $7 million true-up was primarily in gaming and broadcast sectors [23] Question: Growth in mobile revenue - Mobile growth was attributed to a combination of new deals and renewals, with expectations for slight full-year growth [24] Question: Update on patent monetization strategy - The company aims for 10% of revenue from content service providers within three years, with Roku as a significant new licensee [32] Question: Guidance for the quarter - The guidance was influenced by a combination of favorable true-up and strong deal timing, with overall performance aligning closely with expectations [44][46] Question: Feedback from CES - Positive feedback was received regarding the automotive experience and Dolby Vision 2, with significant interest from partners and customers [50][51]

Financial Data and Key Metrics Changes - Revenue for Q1 2026 was $347 million, exceeding the high end of guidance, driven by earlier-than-expected deal closures and a $7 million favorable true-up for Q4 shipments [11][12] - Non-GAAP earnings per share was $1.06, also above guidance, attributed to higher revenue and lower operating expenses [11] - Licensing revenue reached $320 million, while product and services revenue was $27 million [11] - Operating cash flow generated was approximately $55 million, with $70 million of common stock repurchased [11][12] Business Line Data and Key Metrics Changes - Mobile revenue grew over 20% year-over-year, while broadcast revenue declined in the mid-teens year-over-year, primarily due to timing of deals [12] - The automotive sector is a major focus, with partnerships increasing from 20 OEMs last year to over 35 this year [6][10] - Dolby Vision 2 was well-received at CES, with support from partners like Peacock and TP Vision, enhancing revenue opportunities from TVs [7][8] Market Data and Key Metrics Changes - The mobile market is expected to see mid-single-digit growth for the full year, despite quarterly fluctuations [12] - The automotive market remains the highest growth area, with diversification geographically, including partnerships with major manufacturers like Mercedes and Audi [60][62] Company Strategy and Development Direction - The company is focused on expanding its addressable market through new growth initiatives, including Dolby OptiView and video distribution programs [10][29] - Dolby Vision 2 aims to enhance viewer experience across various content types, with plans to launch new TVs by the end of the fiscal year [7][10] - The company is optimistic about growth in Dolby Atmos, Dolby Vision, and imaging patents, projecting a growth rate of 15%-20% per year [10][15] Management's Comments on Operating Environment and Future Outlook - Management noted that the early closure of deals does not indicate a broader change in the macro environment but provides confidence in the outlook for the year [18] - The company remains cautious about potential impacts from memory pricing and geopolitical factors but has not seen significant adjustments in guidance [58][59] - The automotive sector continues to thrive, with no immediate impacts from U.S. policy changes observed [62] Other Important Information - A dividend of $0.36 was declared, representing a 9% increase from the previous year [12] - The company ended the quarter with cash and investments of approximately $730 million [12] Q&A Session Summary Question: Impact of deal timing on revenue - Management indicated that earlier deal closures do not suggest a macro trend but help de-risk the outlook for the year [18] Question: Details on the $7 million true-up - The true-up was primarily in gaming and broadcast sectors [19] Question: Growth in mobile revenue - Growth was attributed to new deals and renewals, with expectations for slight increases over the full year [21] Question: Potential market share gains from Sony's spin-off - Management expressed optimism about strong relationships with both TCL and Sony, focusing on increasing TV attach rates [22][23] Question: Cash flow generation comparison - Cash flow can fluctuate based on deal timing, but it typically tracks closely with non-GAAP net income [24] Question: Update on patent monetization strategy - The company aims for 10% of revenue from content service providers within three years, with progress in the video distribution program [29][30] Question: OEM responses to macro issues - Management noted that while there are adjustments, they are not material, and the mobile market is most affected [58][59] Question: Adoption of in-car offerings amid policy changes - No significant impact observed; the automotive sector remains a high-growth area [62]

Core Insights - Dolby Laboratories reported a total revenue of $347 million for the first quarter of fiscal 2026, a decrease from $357 million in the same quarter of fiscal 2025 [7] - GAAP net income was $53 million or $0.55 per diluted share, down from $68 million or $0.70 per diluted share year-over-year [7] - Non-GAAP net income for the first quarter was $103 million or $1.06 per diluted share, compared to $111 million or $1.14 per diluted share in the prior year [7] Financial Highlights - Total revenue decreased by approximately 2.8% year-over-year [7] - GAAP net income decreased by about 22.1% year-over-year [7] - Non-GAAP net income also saw a decline of around 7.2% year-over-year [7] - The company repurchased approximately one million shares for about $70 million, with $207 million remaining in stock repurchase authorization [7] Business Developments - Dolby continues to see strong momentum with Dolby Atmos and Dolby Vision, expanding its market through imaging patent programs and Dolby OptiView [2] - Over 35 automotive OEMs have adopted Dolby Atmos, with notable partnerships including Mercedes-Benz and Mahindra [7] - Peacock is the first streaming service to implement Dolby's full suite of advanced picture and sound technologies, including Dolby Vision 2 [7] Dividend Announcement - Dolby announced a cash dividend of $0.36 per share for Class A and Class B common stock, payable on February 18, 2026 [5] Financial Outlook - For the second quarter of fiscal 2026, total revenue is estimated to range from $375 million to $405 million, with licensing revenue expected between $350 million and $380 million [11] - For the full year of fiscal 2026, total revenue is projected to be between $1.4 billion and $1.45 billion [11] - Gross margins are anticipated to be approximately 90% on a GAAP basis and 91% on a non-GAAP basis [11]

Core Viewpoint - Dolby Laboratories, Inc. will announce its financial results for Q1 fiscal year 2026 on January 29, 2026, after market close [1] Group 1: Financial Results Announcement - The financial results for Q1 fiscal year 2026 will be released after the close of regular trading on January 29, 2026 [1] - A conference call will be held at 2:00 p.m. PT (5:00 p.m. ET) on the same day to discuss the financial results [1] Group 2: Teleconference Access - Access to the teleconference can be obtained via the investor relations website or by dialing a specific phone number with a confirmation code [2] - A replay of the call will be available from 5:00 p.m. PT on January 29, 2026, until 8:59 p.m. PT on February 5, 2026 [3] Group 3: Company Overview - Dolby Laboratories is a leader in immersive entertainment, providing experiences across various media including movies, TV, music, and gaming [4] - The company is known for innovations such as Dolby Atmos, Dolby Vision, and Dolby Cinema, enhancing entertainment experiences for billions globally [4]

Core Insights - Dolby Laboratories reported strong Q4 fiscal 2025 results, with non-GAAP EPS of 99 cents, exceeding the Zacks Consensus Estimate of 70 cents and up from 81 cents in the prior year [2] - Total revenues reached $307 million, slightly up from $304.8 million year-over-year, and surpassed the Zacks Consensus Estimate by 0.5% [2] - The company is optimistic about fiscal 2026, focusing on growth through its Dolby Atmos, Dolby Vision, and new imaging patent pool for content streaming [3] Financial Performance - Licensing revenues were $281.6 million, down 0.4% year-over-year, aligning with company guidance [4] - Products and Services revenues increased by 14.9% year-over-year to $25.4 million [4] - Gross profit for Q4 was $267.5 million, compared to $270.8 million in the previous year, while operating income decreased to $29.7 million from $46.4 million [6] Cash Flow & Shareholder Returns - For the fiscal year ending September 26, 2025, Dolby generated $472.2 million in net cash from operating activities [7] - The company repurchased approximately 479,000 shares for about $35 million during the quarter, with $277 million remaining under its stock repurchase authorization [8] - A cash dividend of 36 cents per share was declared, payable on December 10, 2025 [8] 2026 Outlook - For Q1 fiscal 2026, Dolby estimates revenues between $315 million and $345 million, projecting an 8% decline year-over-year at the midpoint [10] - Full-year revenues for fiscal 2026 are expected to be in the range of $1.39 billion to $1.44 billion, up from $1.35 billion in fiscal 2025 [11] - Licensing revenues are projected to range from $1.285 billion to $1.335 billion, with anticipated declines in certain segments [12] Market Position & Competitors - Dolby Laboratories holds a Zacks Rank 3 (Hold), indicating an expectation of in-line returns in the coming months [16] - In comparison, Sonos, a competitor in the audio video production industry, reported a revenue increase of 12.7% year-over-year, highlighting competitive dynamics within the sector [17][18]

Core Viewpoint - The Bay Area Host Committee (BAHC) has formed a partnership with Dolby to enhance live sports and real-time streaming experiences during Super Bowl LX in February 2026, showcasing Dolby's innovative technologies [1][3][4]. Partnership Details - Dolby is designated as the Official Signature Partner of BAHC for Super Bowl LX, aiming to set new standards for technology in major sporting events [1][3]. - The partnership includes Dolby serving as the Premier Partner of the BAHC Super Bowl LX Innovation Summit, featuring immersive demonstrations and thought-leadership sessions [4][6]. Technological Innovations - Dolby will showcase its technologies, including Dolby Vision, Dolby Atmos, and Dolby OptiView, to create immersive and interactive streaming experiences that enhance audience engagement [3][4]. - The collaboration aims to redefine fan experiences through innovative technologies that connect entertainment, culture, and community [4][6]. Community Engagement - The partnership will spotlight the intersection of technology and community, with programs designed to create opportunities and lasting impact [6][7]. - Dolby and BAHC will collaborate on a branded content series that celebrates innovation and community in the Bay Area [6]. Event Highlights - Dolby will play a significant role in the BAHC Kickoff Party at its San Francisco headquarters, providing exclusive demos and experiences [5]. - Throughout the Super Bowl week, fans will engage with Dolby's innovations through various immersive activations and events across the Bay Area [6].

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]

Financial Data and Key Metrics Changes - Revenue for Q4 came in at $307 million, above the midpoint of guidance, with non-GAAP earnings per share of $0.99, exceeding high-end guidance due to a $0.28 discrete tax benefit [16] - For FY2025, total revenue was $1.35 billion, up 6% year over year, with non-GAAP earnings per share of $4.24, or $3.97 excluding the discrete tax benefit [17] - Operating cash flow generated was approximately $123 million, with a share repurchase of $35 million and a declared dividend of $0.36, up 9% from the previous year [16][17] Business Line Data and Key Metrics Changes - Licensing revenue for Q4 was $282 million, while products and services revenue was $25 million [16] - Dolby Atmos, Dolby Vision, and Imaging Patents grew just over 14% in FY2025, representing 45% of licensing revenue [17] - Foundational audio technology revenue was just under negative 1%, aligning with expectations of roughly flat growth [17] Market Data and Key Metrics Changes - Strong growth was observed in mobile driven by the GE Licensing acquisition, while PC and broadcast grew mid-single digits, and consumer electronics (CE) was down, in line with expectations [17] - The automotive sector is identified as a fast-growing area, with Dolby Atmos music being integrated into more vehicle models [40] Company Strategy and Development Direction - The company aims to expand its total addressable market by delivering value to new customers through consumption-based revenue models, including the video distribution program for content streamers and Dolby OptiView [10][14] - Dolby Vision 2 is set to enhance picture quality and is receiving strong industry support, with major TV manufacturers announcing their commitment [5][6] - The focus on AI-powered innovations is part of the company's strategy to enhance current and future offerings [14] Management's Comments on Operating Environment and Future Outlook - Management noted that while the overall device market is sluggish, they have been able to grow Dolby Atmos, Dolby Vision, and imaging patents at about 20% a year [56] - The company does not anticipate significant impacts from tariffs and believes its device partners have shown resilience in dealing with supply chain issues [56] - For FY2026, revenue is expected to grow between 3%-7%, with Dolby Atmos, Dolby Vision, and Imaging Patents revenue projected to grow approximately 15% [19] Other Important Information - The company recorded a $6 million restructuring charge in Q4 as part of efforts to streamline operations [16] - The first revenue from the new imaging patent pool for content streamers is expected to be recognized in FY2026 [9] Q&A Session Summary Question: Expansion of Total Addressable Market with New Consumption Models - Management confirmed that the video distribution program combines existing imaging patents with GE Licensing patents, significantly expanding the addressable market [28] Question: Imaging Patents and Revenue Generation - The imaging patent licensing is driven by patent pools, with five licensees signed up in the second half of FY2025, expected to generate revenue in FY2026 [31] Question: Impact of Tariffs and Consumer State - Management indicated no identifiable impact from tariffs and noted that the device market is stabilizing after previous declines [56] Question: Progress in Automotive Sector - The automotive sector is expected to become a separate end market, with ongoing efforts to integrate Dolby Atmos into more vehicle models [40] Question: Capital Allocation and Share Repurchase - The company has over $270 million remaining for share repurchase authorization and continues to evaluate its capital allocation strategy [60]