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Dolby (DLB) Q4 Earnings & Revenues Miss Estimates, Down Y/Y
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Dolby Laboratories, Inc (DLB - Free Report) reported fourth-quarter fiscal 2022 results, with both the top and the bottom lines missing the Zacks Consensus Estimate.
Non-GAAP earnings per share were 54 cents compared with 58 cents reported in the prior-year quarter. The bottom line missed the Zacks Consensus Estimate by 22.9%.
Total revenues were $278.2 million, down from $285 million in the year-ago quarter. The top line missed the Zacks Consensus Estimate by 8.4%. The downtick was caused by lower shipments in PC, broadcast, consumer electronics and gaming. However, the company continued to witness increased adoption of Dolby Atmos and Dolby Vision, new imaging patents, along with improved results for the Dolby Cinemas owing to improvements in the cinema industry.
The company announced a dividend hike of 8% to 27 cents per share, payable on Dec 8, to shareholders of record on Nov 30.
Dolby Laboratories Price, Consensus and EPS Surprise
Following the announcement, shares of the company tumbled 6% in aftermarket trading on Nov 17.
Segmental Performance
Revenues from Licensing were $249.1 million, down from $266 million reported in the prior year quarter. Products and Services’ revenues were $29 million, compared with $19.1 million reported in the year ago quarter.
Broadcast Licensing contributed 44% to the total licensing revenues in the fiscal fourth quarter. Mobile Licensing accounted for 14%, Consumer Electronics 14%, PC Licensing 13% and Licensing from Other Markets contributed 15% to licensing revenues.
Other Details
Gross profit in the fiscal fourth quarter was $241 million compared with $254.3 million in the year-earlier quarter. Total operating expenses marginally declined to $213.9 million from $214 million reported in the previous year quarter. Operating income was $27.1 million compared with $40.4 million in the year-ago quarter.
In the fiscal fourth quarter, the company repurchased 2.9 million of its common shares and ended the quarter with $361 million of stock repurchase authorization available.
Cash Flow and Liquidity
In the fiscal fourth quarter, Dolby generated $51.3 million of net cash from operating activities compared with $109.8 million a year ago.
As of Sep 30, the company had $620.1 million in cash and cash equivalents, with $438.5 million in total liabilities.
Guidance
For the fiscal first quarter 2023, the company expects GAAP earnings of 46-61 cents per share and non-GAAP earnings of 76-91 cents per share on revenues of $300-$330 million. On a GAAP basis, operating expenses are expected to be $214-$224 million, whereas, on a non-GAAP basis, operating expenses are anticipated to be $180-$190 million.
For fiscal 2023, the company expects revenues to grow in the range of low single digits year-over-year. GAAP operating margin is expected to be 19% while non-GAAP operating margin is expected to be nearly 30%. On a GAAP basis, operating expenses are expected to decline by 2%, whereas, on a non-GAAP basis, operating expenses are anticipated to increase by 2%.
Dolby expects declines in consumer device shipments going ahead due to macroeconomic weakness, supply chain troubles and inflation along with geopolitical instability. As a result, the audio segment is declined mid-single digits during the year.
Dolby Vision, Dolby Atmos, and imaging patents business is likely to witness growth in the range of 15-25% in fiscal 2023, driven by continued momentum in broadcast, mobile, and other markets.
The Zacks Consensus Estimate for Arista Networks’ 2022 earnings is pegged at $4.35 per share, up 7.7% in the past 60 days. The long-term earnings growth rate is anticipated to be 17.5%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 12.7%. Shares of ANET have increased 2.4% in the past year.
The Zacks Consensus Estimate for Blackbaud’s 2022 earnings is pegged at $2.59 per share, up 1.6% in the past 60 days. The long-term earnings growth rate is anticipated to be 4%.
Blackbaud’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 4.9%. Shares of BLKB have declined 30.7% in the past year.
The Zacks Consensus Estimate for Jabil’s fiscal 2023 earnings is pegged at $8.18 per share, rising 3.8% in the past 60 days. The long-term earnings growth rate is anticipated to be 12%.
Jabil’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, the average being 9.3%. Shares of JBL have increased 8.8% in the past year.
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Dolby (DLB) Q4 Earnings & Revenues Miss Estimates, Down Y/Y
Dolby Laboratories, Inc (DLB - Free Report) reported fourth-quarter fiscal 2022 results, with both the top and the bottom lines missing the Zacks Consensus Estimate.
Non-GAAP earnings per share were 54 cents compared with 58 cents reported in the prior-year quarter. The bottom line missed the Zacks Consensus Estimate by 22.9%.
Total revenues were $278.2 million, down from $285 million in the year-ago quarter. The top line missed the Zacks Consensus Estimate by 8.4%. The downtick was caused by lower shipments in PC, broadcast, consumer electronics and gaming. However, the company continued to witness increased adoption of Dolby Atmos and Dolby Vision, new imaging patents, along with improved results for the Dolby Cinemas owing to improvements in the cinema industry.
The company announced a dividend hike of 8% to 27 cents per share, payable on Dec 8, to shareholders of record on Nov 30.
Dolby Laboratories Price, Consensus and EPS Surprise
Dolby Laboratories price-consensus-eps-surprise-chart | Dolby Laboratories Quote
Following the announcement, shares of the company tumbled 6% in aftermarket trading on Nov 17.
Segmental Performance
Revenues from Licensing were $249.1 million, down from $266 million reported in the prior year quarter. Products and Services’ revenues were $29 million, compared with $19.1 million reported in the year ago quarter.
Broadcast Licensing contributed 44% to the total licensing revenues in the fiscal fourth quarter. Mobile Licensing accounted for 14%, Consumer Electronics 14%, PC Licensing 13% and Licensing from Other Markets contributed 15% to licensing revenues.
Other Details
Gross profit in the fiscal fourth quarter was $241 million compared with $254.3 million in the year-earlier quarter. Total operating expenses marginally declined to $213.9 million from $214 million reported in the previous year quarter. Operating income was $27.1 million compared with $40.4 million in the year-ago quarter.
In the fiscal fourth quarter, the company repurchased 2.9 million of its common shares and ended the quarter with $361 million of stock repurchase authorization available.
Cash Flow and Liquidity
In the fiscal fourth quarter, Dolby generated $51.3 million of net cash from operating activities compared with $109.8 million a year ago.
As of Sep 30, the company had $620.1 million in cash and cash equivalents, with $438.5 million in total liabilities.
Guidance
For the fiscal first quarter 2023, the company expects GAAP earnings of 46-61 cents per share and non-GAAP earnings of 76-91 cents per share on revenues of $300-$330 million. On a GAAP basis, operating expenses are expected to be $214-$224 million, whereas, on a non-GAAP basis, operating expenses are anticipated to be $180-$190 million.
For fiscal 2023, the company expects revenues to grow in the range of low single digits year-over-year. GAAP operating margin is expected to be 19% while non-GAAP operating margin is expected to be nearly 30%. On a GAAP basis, operating expenses are expected to decline by 2%, whereas, on a non-GAAP basis, operating expenses are anticipated to increase by 2%.
Dolby expects declines in consumer device shipments going ahead due to macroeconomic weakness, supply chain troubles and inflation along with geopolitical instability. As a result, the audio segment is declined mid-single digits during the year.
Dolby Vision, Dolby Atmos, and imaging patents business is likely to witness growth in the range of 15-25% in fiscal 2023, driven by continued momentum in broadcast, mobile, and other markets.
Zacks Rank & Stocks to Consider
Dolby currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks from the broader technology space are Arista Networks (ANET - Free Report) , Blackbaud (BLKB - Free Report) and Jabil (JBL - Free Report) . Arista Networks and Jabil currently sport a Zacks Rank #1 (Strong Buy) while Blackbaud carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Arista Networks’ 2022 earnings is pegged at $4.35 per share, up 7.7% in the past 60 days. The long-term earnings growth rate is anticipated to be 17.5%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 12.7%. Shares of ANET have increased 2.4% in the past year.
The Zacks Consensus Estimate for Blackbaud’s 2022 earnings is pegged at $2.59 per share, up 1.6% in the past 60 days. The long-term earnings growth rate is anticipated to be 4%.
Blackbaud’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 4.9%. Shares of BLKB have declined 30.7% in the past year.
The Zacks Consensus Estimate for Jabil’s fiscal 2023 earnings is pegged at $8.18 per share, rising 3.8% in the past 60 days. The long-term earnings growth rate is anticipated to be 12%.
Jabil’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, the average being 9.3%. Shares of JBL have increased 8.8% in the past year.