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Dolby's (DLB) Q4 Earnings & Revenues Beat Estimates, Up Y/Y

Dolby Laboratories, Inc DLB reported fourth-quarter fiscal 2023 results, with non-GAAP earnings per share (EPS) of 65 cents compared with 54 cents reported in the prior-year quarter. The bottom line surpassed the Zacks Consensus Estimate of 52 cents.

Total revenues were $290.6 million, up from $278.2 million in the year-ago quarter. The top line surpassed the Zacks Consensus Estimate by 1.46%. The uptick was caused by increased adoption of Dolby Atmos and Dolby Vision.

The company announced a dividend of 30 cents per share, payable on Dec 5, to shareholders of record on Nov 28, 2023.

Dolby Laboratories Price, Consensus and EPS Surprise

Dolby Laboratories Price, Consensus and EPS Surprise
Dolby Laboratories Price, Consensus and EPS Surprise

Dolby Laboratories price-consensus-eps-surprise-chart | Dolby Laboratories Quote

Segmental Performance

Revenues from Licensing were $265.2 million, up from $249.1 million reported in the prior-year quarter. Products and Services’ revenues were $25.3 million compared with $29.1 million reported in the year-ago quarter.

Broadcast Licensing contributed 39% to the total licensing revenues in the fiscal fourth quarter. Mobile Licensing accounted for 14%, Consumer Electronics 16%, PC Licensing 10% and Licensing from Other Markets contributed 22% to licensing revenues.

Other Details

Gross profit in the fiscal fourth quarter was $255.1 million compared with $241.1 million in the year-ago quarter. Total operating expenses increased to $258.5 million from $213.9 million reported in the year-ago quarter.

Operating loss was $3.5 million against the operating income of $27.1 million in the year-ago quarter.

In the fiscal fourth quarter, the company repurchased 0.3 million of its common shares and ended the quarter with $212 million of stock repurchase authorization.

Cash Flow and Liquidity

In the fiscal fourth quarter, Dolby generated $85 million of net cash from operating activities compared with $51.3 million in the prior-year period.
As of Sep 29, 2023, the company had $745.4 million in cash and cash equivalents, with $607.6 million in total liabilities.

2024 Guidance

For the first quarter of fiscal 2024, the company expects GAAP EPS of 44-59 cents and non-GAAP EPS of 80-95 cents on revenues of $300-$330 million.

On a GAAP basis, operating expenses are expected to be in the range of $220-$230 million, whereas, on a non-GAAP basis, operating expenses are anticipated to be between $180 million and $190 million.

For fiscal 2024, the company expects revenues to be $1.30 billion. GAAP operating margin is expected to be 20%, while the non-GAAP operating margin is expected to be nearly 32%.

On a GAAP basis, operating expenses are expected to be between $885 million and $895 million, whereas, on a non-GAAP basis, operating expenses are anticipated to be in the range of $740-$750 million. The company expects GAAP EPS of $2.30-$2.45 and non-GAAP EPS of $3.60-$3.75.

Zacks Rank & Stocks to Consider

Dolby currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology space are Guidewire Software GWRE, Flex FLEX and Badger Meter BMI. Each stock presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Guidewire Software’s fiscal 2024 EPS has increased 10.5% in the past 60 days to 74 cents. Shares of GWRE have soared 47.1% in the past year.

The Zacks Consensus Estimate for Flex’s fiscal 2024 EPS has gained 3.6% in the past 60 days to $2.56. Flex’s long-term earnings growth rate is 12.4%. Shares of FLEX have gained 29.5% in the past year.

The Zacks Consensus Estimate for Badger Meter’s 2023 EPS has improved 7.3% in the past 60 days to $3.07.

Badger Meter’s earnings outpaced the Zacks Consensus Estimate in all the last four quarters, the average surprise being 10.3%. Shares of BMI have rallied 24.6% in the past year.

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Dolby Laboratories (DLB) : Free Stock Analysis Report

Badger Meter, Inc. (BMI) : Free Stock Analysis Report

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