We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Dolby (DLB) Q3 Earnings Surpass Estimates, Revenues Up Y/Y
Read MoreHide Full Article
Dolby Laboratories, Inc. (DLB - Free Report) reported third-quarter fiscal 2018 adjusted earnings of 92 cents per share, surpassing the Zacks Consensus Estimate of 82 cents.
The company’s GAAP earnings came in at 78 cents per share compared with 73 cents in the year-ago quarter.
Inside the Headlines
Dolby’s total revenues of $317.4 million came within the company’s projected range of $310-$320 million. Also, the top line beat the Zacks Consensus Estimate of $317.3 million and improved 3.8% on a year-over-year basis. Healthy increase in revenues across Licensing and Products segments contributed to the decent rise in the top line.
Dolby Laboratories Price, Consensus and EPS Surprise
The company’s Licensing revenues came in at $286.3 million, up 2.9% year over year. Consumer electronics and Mobile devices sales drove the segment’s growth. While higher revenues in DMAs drove Consumer Electronic sales, Mobile devices grew on the back of higher adoption of the company’s technologies into more devices. Licensing in other markets was up about 3% year over year, driven by higher revenues in Dolby Cinema, Dolby Voice and gaming.
Product revenues came in at $26.3 million, up 16.4% on a year-over-year basis. This improvement was driven by growth in Cinema products and Dolby Voice. Revenues at the Services segment decreased 2.7% to $4.8 million.
In the fiscal third quarter, Dolby’s operating margin contracted 140 basis points year over year to 29.9%.
Liquidity
As of Jun 29, 2018, Dolby had cash and cash equivalents of approximately $829.6 million, up from $592.6 million as of Jun 30, 2017.
As of Jun 29, 2018, net cash provided by operating activities came in at $240.5 million compared with $297.4 million a year ago.
Guidance
Concurrent with the market scenario, Dolby issued guidance for fourth-quarter fiscal 2018 earnings and revenues. The company envisions non-GAAP earnings in the range of 40-46 cents, while revenues are expected to lie within $265-$275 million.
While non-GAAP gross margin is projected to be about 87%, non-GAAP operating expenses are expected between $176 million and $180 million.
Dolby also provided guidance for fiscal 2018. Total revenues are anticipated in the range of $1.17-$1.18 billion. Revenue streams such as mobile revenues, Consumer Electronics and other licensing category are expected to drive top-line growth.
Further, non-GAAP operating expenses for fiscal 2018 are projected between $670 million and $674 million.
Our Take
Going forward, impressive market traction of offerings under three of Dolby’s businesses —Dolby Voice, Dolby Vision and Dolby Cinema — are likely to fortify its market footprint. Additionally, the company’s partnerships with industry frontrunners are expected to boost market traction of its offerings. Dolby’s mobile devices unit is also expected to benefit from audio and consumer imaging programs, and higher recoveries.
However, the company’s services segment is witnessing a decline in revenues, hurting its overall performance. The market for consumer entertainment products is highly competitive and price sensitive, which exposes Dolby to the risk of lower revenues.
AMC Networks surpassed estimates in each of the trailing four quarters with an average beat of 28.43%.
Pool Corporation exceeded estimates thrice in the trailing four quarters with an average beat of 7.75%.
V.F. Corporation surpassed estimates thrice in the trailing four quarters with an average beat of 11.58%.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Dolby (DLB) Q3 Earnings Surpass Estimates, Revenues Up Y/Y
Dolby Laboratories, Inc. (DLB - Free Report) reported third-quarter fiscal 2018 adjusted earnings of 92 cents per share, surpassing the Zacks Consensus Estimate of 82 cents.
The company’s GAAP earnings came in at 78 cents per share compared with 73 cents in the year-ago quarter.
Inside the Headlines
Dolby’s total revenues of $317.4 million came within the company’s projected range of $310-$320 million. Also, the top line beat the Zacks Consensus Estimate of $317.3 million and improved 3.8% on a year-over-year basis. Healthy increase in revenues across Licensing and Products segments contributed to the decent rise in the top line.
Dolby Laboratories Price, Consensus and EPS Surprise
Dolby Laboratories Price, Consensus and EPS Surprise | Dolby Laboratories Quote
The company’s Licensing revenues came in at $286.3 million, up 2.9% year over year. Consumer electronics and Mobile devices sales drove the segment’s growth. While higher revenues in DMAs drove Consumer Electronic sales, Mobile devices grew on the back of higher adoption of the company’s technologies into more devices. Licensing in other markets was up about 3% year over year, driven by higher revenues in Dolby Cinema, Dolby Voice and gaming.
Product revenues came in at $26.3 million, up 16.4% on a year-over-year basis. This improvement was driven by growth in Cinema products and Dolby Voice. Revenues at the Services segment decreased 2.7% to $4.8 million.
In the fiscal third quarter, Dolby’s operating margin contracted 140 basis points year over year to 29.9%.
Liquidity
As of Jun 29, 2018, Dolby had cash and cash equivalents of approximately $829.6 million, up from $592.6 million as of Jun 30, 2017.
As of Jun 29, 2018, net cash provided by operating activities came in at $240.5 million compared with $297.4 million a year ago.
Guidance
Concurrent with the market scenario, Dolby issued guidance for fourth-quarter fiscal 2018 earnings and revenues. The company envisions non-GAAP earnings in the range of 40-46 cents, while revenues are expected to lie within $265-$275 million.
While non-GAAP gross margin is projected to be about 87%, non-GAAP operating expenses are expected between $176 million and $180 million.
Dolby also provided guidance for fiscal 2018. Total revenues are anticipated in the range of $1.17-$1.18 billion. Revenue streams such as mobile revenues, Consumer Electronics and other licensing category are expected to drive top-line growth.
Further, non-GAAP operating expenses for fiscal 2018 are projected between $670 million and $674 million.
Our Take
Going forward, impressive market traction of offerings under three of Dolby’s businesses —Dolby Voice, Dolby Vision and Dolby Cinema — are likely to fortify its market footprint. Additionally, the company’s partnerships with industry frontrunners are expected to boost market traction of its offerings. Dolby’s mobile devices unit is also expected to benefit from audio and consumer imaging programs, and higher recoveries.
However, the company’s services segment is witnessing a decline in revenues, hurting its overall performance. The market for consumer entertainment products is highly competitive and price sensitive, which exposes Dolby to the risk of lower revenues.
Zacks Rank & Stocks to Consider
Dolby currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks in the same space are AMC Networks Inc. (AMCX - Free Report) , Pool Corporation (POOL - Free Report) and V.F. Corporation (VFC - Free Report) . While AMC Networks sports a Zacks Rank #1 (Strong Buy), Pool Corporation and V.F. Corporation carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
AMC Networks surpassed estimates in each of the trailing four quarters with an average beat of 28.43%.
Pool Corporation exceeded estimates thrice in the trailing four quarters with an average beat of 7.75%.
V.F. Corporation surpassed estimates thrice in the trailing four quarters with an average beat of 11.58%.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>