Dolby Laboratories, Inc. (NYSE:DLB) today announced the company's
financial results for the fourth quarter and full year of fiscal
2022.
"We continue to make progress in bringing the Dolby experience
to all the ways people enjoy their content," said Kevin Yeaman,
President and CEO, Dolby Laboratories. "While results came in below
our expectations, we grew our presence across movies and TV, music,
and user-generated content and we are confident in our long-term
growth opportunities."
Fourth Quarter Fiscal 2022 Financial
Highlights
- Total revenue was $278.2 million, compared to $285.0 million
for the fourth quarter of fiscal 2021.
- GAAP net income was $27.8 million, or $0.28 per diluted share,
compared to GAAP net income of $44.2 million, or $0.42 per diluted
share, for the fourth quarter of fiscal 2021. On a non-GAAP basis,
fourth quarter net income was $52.8 million, or $0.54 per diluted
share, compared to $60.4 million, or $0.58 per diluted share, for
the fourth quarter of fiscal 2021.
- Cash flows from operations were $51.3 million, compared to
$109.8 million for the fourth quarter of fiscal 2021.
- We repurchased 2.9 million shares of our common stock and ended
the quarter with about $361 million of stock repurchase
authorization available going forward.
Full Year Fiscal 2022 Financial Highlights
- Total revenue was $1.25 billion, compared to $1.28 billion for
the full year of fiscal 2021.
- GAAP net income was $184.1 million, or $1.81 per diluted share,
compared to GAAP net income of $310.2 million, or $2.97 per diluted
share, for the full year of fiscal 2021. On a non-GAAP basis, full
year net income was $319.9 million, or $3.14 per diluted share,
compared to $383.3 million, or $3.66 per diluted share, for the
full year of fiscal 2021.
- Cash flows from operations were $318.6 million, compared to
$447.8 million for the full year of fiscal 2021.
- We held cash, cash equivalents, and investments of $911.9
million as of September 30, 2022.
A complete listing of Dolby's non-GAAP measures are described
and reconciled to the corresponding GAAP measures at the end of
this release.
Recent Business Highlights
- Volvo, Polestar, Lotus, and XPENG all announced their first
vehicles to support Dolby Atmos.
- Gaana.com, a leading music streaming service in India, launched
the support of Dolby Atmos.
- The German Super Cup final match was broadcast for the first
time in Dolby Atmos.
- Moong Labs announced the launch of its popular mobile game
"Epic Cricket – Big League" in Dolby Atmos.
- Xiaomi introduced the MIX Fold 2, their second smartphone to
support Dolby Vision Capture.
- Microsoft announced three new Surface computers, all with Dolby
Atmos and Dolby Vision.
Dividend
Today, Dolby announced a cash dividend of $0.27 per share of
Class A and Class B common stock, payable on December 8, 2022,
to stockholders of record as of the close of business on
November 30, 2022.
Financial Outlook
Dolby’s financial outlook relies on estimates of royalty-based
revenue that take into consideration the macroeconomic effect of
certain events, including COVID-19, supply chain constraints, and
consumer demand for electronic products. In addition, our actual
results could differ materially from the estimates we are providing
below due in part to the increased uncertainty resulting from these
items as well as the geopolitical instability and continuing
concerns around inflation and rising interest rates. The
uncertainty resulting from these factors has greatly reduced our
visibility into our future outlook. To the extent possible, the
estimates we are providing for future periods reflect certain
assumptions about the potential impact of certain of these items,
based upon a consideration of currently available external and
internal data and information. These assumptions are subject to
risks and uncertainties. For more information, see "Forward-Looking
Statements" in this press release for a description of certain
risks that we face, and the section captioned "Risk Factors" in our
Annual Report on Form 10-K for fiscal 2022, to be filed on or
around the date hereof.
Dolby is providing the following high-level estimates for the
full year of fiscal 2023:
- Total revenue is expected to grow low single digits
year-over-year.
- GAAP operating expenses are expected to decline roughly 2%
year-over-year. Non-GAAP operating expenses are expected to grow
roughly 2% year-over-year.
- We expect operating margins on a GAAP basis to be roughly 19%
and on a non-GAAP basis to be roughly 30%.
Dolby is providing the following estimates for its first quarter
of fiscal 2023:
- Total revenue is estimated to range from $300 million to $330
million.
- Operating expenses are anticipated to range from $214 million
to $224 million on a GAAP basis and from $180 million to $190
million on a non-GAAP basis.
- Effective tax rate is anticipated to range from 22% to 24% on a
GAAP basis and 19% to 21% on a non-GAAP basis.
- Diluted earnings per share is anticipated to range from $0.46
to $0.61 on a GAAP basis and from $0.76 to $0.91 on a non-GAAP
basis.
Conference Call Information
Members of Dolby management will lead a conference call open to
all interested parties to discuss fourth quarter fiscal 2022
financial results for Dolby Laboratories at 2:00 p.m. PT (5:00 p.m.
ET) on Thursday, November 17, 2022. Access to the
teleconference will be available at
http://investor.dolby.com or by dialing 1-844-200-6205 (or
dialing 1-929-526-1599 for international callers) and entering
confirmation code 357413.
A replay of the call will be available from 5:00 p.m. PT (8:00
p.m. ET) on Thursday, November 17, 2022, until 11:00 p.m. PT
on Thursday, November 24, 2022 (2:00 a.m. ET on Friday, November
25, 2022), by dialing 1-866-813-9403 (international callers can
access the replay by dialing +44-204-525-0658) and entering the
confirmation code 258585. An archived version of the teleconference
will also be available on the Dolby website,
http://investor.dolby.com.
Financial Results
The financial results for the fourth quarter and fiscal year
ended September 30, 2022 discussed in this release are subject to
the completion of the audit of our year-end financial statements
and to adjustment, pursuant to our revenue recognition policies
under ASC 606. In accordance with ASC 606, we may be required to
recognize revenue between the date of this release and the time at
which we issue our audited consolidated financial statements. Any
changes to the estimated financial results discussed above as a
result of our revenue recognition policies under ASC 606 will be
included in our Annual Report on Form 10-K for fiscal 2022.
Non-GAAP Financial Information
To supplement Dolby's financial statements presented on a GAAP
basis, Dolby management uses, and Dolby provides to investors,
certain non-GAAP financial measures as an additional tool to
evaluate Dolby's operating results in a manner that focuses on what
Dolby's management believes to be its ongoing business operations
and performance. Specifically, we exclude the following as
adjustments from one or more of our non-GAAP financial
measures:
Stock-based compensation expense: Stock-based compensation,
unlike cash-based compensation, utilizes subjective assumptions in
the methodologies used to value the various stock-based award types
that we grant. These assumptions may differ from those used by
other companies. To facilitate more meaningful comparisons between
our underlying operating results and those of other companies, we
exclude stock-based compensation expense.
Amortization of acquisition-related intangibles: We amortize
intangible assets acquired in connection with acquisitions. These
intangible assets consist of patents and technology, customer
relationships, and other intangibles. We record amortization
charges relating to these intangible assets in our GAAP financial
statements, and we view these charges as items arising from
pre-acquisition activities that are determined by the timing and
valuation of our acquisitions. As these amortization charges do not
directly correlate to our operations during any particular period,
we exclude these charges to facilitate an evaluation of our current
operating performance and comparisons to our past operating
results.
Restructuring charges: Restructuring charges are costs
associated with restructuring plans and primarily relate to costs
associated with exit or disposal activities, employee severance
benefits, and asset impairments. We exclude restructuring costs,
including any adjustments to charges recorded in prior periods, as
we believe that these costs are not representative of our normal
operating activities and therefore, excluding these amounts enables
a more effective comparison to our past operating performance.
Other operating income adjustments: In the second quarter of
fiscal 2022, we recorded an expense of $34.4 million related
to a one-time settlement and accrual in connection with
indemnification requests under commercial agreements that we
assumed as part of an acquisition in 2014 related to our cinema
products business. We expect this settlement and related accrual to
fully resolve this matter. Also, in the first quarter of fiscal
2021, we recorded a one-time gain on the sale of property, which
was previously classified as held for sale. The property was 51%
owned by the controlling interest, therefore 51% of the gain
recognized has been attributed to the controlling interest. We have
excluded both of these items as they are unusual, non-recurring
events that are not representative of our normal operating
activities and therefore, excluding these amounts enables a more
effective comparison to our past operating performance.
Income tax adjustments: We believe that excluding the income tax
effect of the aforementioned non-GAAP adjustments provides a more
accurate view of our underlying operating results to management and
investors.
Using the aforementioned adjustments, Dolby provides various
non-GAAP financial measures including, but not limited to: non-GAAP
net income, non-GAAP diluted earnings per share, non-GAAP gross
margin, non-GAAP operating expenses, non-GAAP operating margin, and
non-GAAP effective tax rate. Dolby's management believes it is
useful for itself and investors to review both GAAP and non-GAAP
measures to assess the performance of Dolby's business,
including as a means to evaluate period-to-period comparisons.
Dolby's management does not itself, nor does it suggest that
investors should, consider non-GAAP financial measures in isolation
from, superior to, or as a substitute for, financial information
prepared in accordance with GAAP. Whenever Dolby uses non-GAAP
financial measures, it provides a reconciliation of the non-GAAP
financial measures to the most closely applicable GAAP financial
measures. Investors are encouraged to review the related GAAP
financial measures and the reconciliation of these non-GAAP
financial measures to their most directly comparable GAAP financial
measures as detailed above and below. Investors are also encouraged
to review Dolby's GAAP financial statements as reported in its US
Securities and Exchange Commission (SEC) filings. A reconciliation
between GAAP and non-GAAP financial measures is provided at the end
of this press release and on the Dolby investor relations website,
http://investor.dolby.com.
Forward-Looking Statements
Certain statements in this press release, including, but not
limited to, statements relating to Dolby's financial results for
the fourth quarter and full year of fiscal 2022, expected financial
results for the first quarter of fiscal 2023 and full year fiscal
2023, our ability to expand existing business, navigating
challenging periods, pursue our long-term growth opportunities, and
advance our other long-term objectives, and future dividend
payments are "forward-looking statements" that inherently involve
substantial risks and uncertainties. These forward-looking
statements are based on management's current expectations, and as a
result of certain risks and uncertainties, actual results may
differ materially from those provided. The following important
factors, without limitation, could cause actual results to differ
materially from those in the forward-looking statements: the
potential impacts of COVID-19 and economic conditions on Dolby’s
business operations, financial results, and financial position
(including the impact to Dolby partners and disruption of the
supply chain and delays in shipments of consumer products; consumer
demand for products that incorporate Dolby technologies; delays in
the development and release of new products or services that
contain Dolby technologies; delays in royalty reporting or
delinquent payment by partners or licensees; lengthening sales
cycles; the impact to the overall cinema market, including closures
or limitations of cinema capacity and resulting adverse impact to
Dolby’s revenue recognized on box-office sales and demand for
cinema products and services; temporary Dolby office closures and
other actions to protect Dolby’s workforce; and macroeconomic
conditions that affect discretionary spending and access to
products that contain Dolby technologies); risks associated with
geopolitical issues, such as the conflict between Russia and
Ukraine; risks associated with trends in the markets in which Dolby
operates, including the broadcast, mobile, consumer electronics,
PC, and other markets; the loss of, or reduction in sales by, a key
customer, partner, or licensee; pricing pressures; risks relating
to changing trends in the way that media is distributed and
consumed; risks relating to conducting business internationally,
including trade restrictions and changes in diplomatic or trade
relationships; risks relating to the expiration of patents; the
timing of Dolby's receipt of royalty reports and payments from its
licensees, including recoveries; changes in tax regulations; timing
of revenue recognition under licensing agreements and other
contractual arrangements; the completion of the audit of our
year-end financial statements, final adjustments and other
developments that may arise between now and the time our audited
consolidated financial statements are issued; Dolby's ability to
develop, maintain, and strengthen relationships with industry
participants; Dolby's ability to develop and deliver innovative
products and technologies in response to new and growing markets;
competitive risks; risks associated with conducting business in
China and other countries that have historically limited
recognition and enforcement of intellectual property and
contractual rights; risks associated with the health of the motion
picture industry generally; Dolby's ability to increase its revenue
streams and to expand its business generally, and to continue to
expand its business beyond its current technology offerings; risks
associated with acquiring and successfully integrating businesses
or technologies; and other risks detailed in Dolby's SEC filings
and reports, including the risks identified under the section
captioned "Risk Factors" in our Annual Report on Form 10-K filed on
or around the date hereof. We may not actually achieve the plans,
intentions, or expectations disclosed in our forward-looking
statements. Forward-looking statements are based upon information
available to us as of the date of this press release, and while we
believe such information forms a reasonable basis for such
statements, such information may be limited or incomplete. These
statements are inherently uncertain and investors are cautioned not
to unduly rely upon these statements. Dolby disclaims any
obligation to update information contained in these forward-looking
statements whether as a result of new information, future events,
or otherwise.
About Dolby Laboratories
Dolby Laboratories (NYSE: DLB) is based in San
Francisco, California with offices around the globe. From movies
and TV shows, to apps, music, sports and gaming, Dolby transforms
the science of sight and sound into spectacular experiences for
billions of people worldwide. We partner with artists,
storytellers, developers, and businesses to revolutionize
entertainment and communications with Dolby Atmos,
Dolby Vision, Dolby Cinema, and Dolby.io.
Dolby, Dolby Atmos, Dolby Vision, Dolby Cinema, Dolby.io, and
the double-D symbol are among the registered and unregistered
trademarks of Dolby Laboratories, Inc. in the United States and/or
other countries. Other trademarks remain the property of their
respective owners.
DOLBY LABORATORIES,
INC.CONSOLIDATED STATEMENTS OF
OPERATIONS(in thousands, except per share amounts;
unaudited)
|
Fiscal Quarter Ended |
|
Fiscal Year Ended |
|
September 30,2022 |
September 24,2021 |
|
September 30,2022 |
September 24,2021 |
Revenue: |
|
|
|
|
|
Licensing |
$ |
249,127 |
|
$ |
265,988 |
|
|
$ |
1,164,533 |
|
$ |
1,214,147 |
|
Products and services |
|
29,077 |
|
|
19,037 |
|
|
|
89,260 |
|
|
67,109 |
|
Total revenue |
|
278,204 |
|
|
285,025 |
|
|
|
1,253,793 |
|
|
1,281,256 |
|
|
|
|
|
|
|
Cost of
revenue: |
|
|
|
|
|
Cost of licensing |
|
16,234 |
|
|
13,935 |
|
|
|
61,597 |
|
|
55,421 |
|
Cost of products and services |
|
20,945 |
|
|
16,764 |
|
|
|
79,763 |
|
|
74,604 |
|
Total cost of revenue |
|
37,179 |
|
|
30,699 |
|
|
|
141,360 |
|
|
130,025 |
|
|
|
|
|
|
|
Gross
margin |
|
241,025 |
|
|
254,326 |
|
|
|
1,112,433 |
|
|
1,151,231 |
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
Research and development |
|
62,070 |
|
|
61,966 |
|
|
|
261,174 |
|
|
253,640 |
|
Sales and marketing |
|
90,202 |
|
|
98,466 |
|
|
|
358,716 |
|
|
332,671 |
|
General and administrative |
|
57,065 |
|
|
54,193 |
|
|
|
275,315 |
|
|
224,161 |
|
Gain on sale of assets |
|
— |
|
|
— |
|
|
|
— |
|
|
(13,871 |
) |
Restructuring charges |
|
4,580 |
|
|
(664 |
) |
|
|
10,623 |
|
|
10,240 |
|
Total operating expenses |
|
213,917 |
|
|
213,961 |
|
|
|
905,828 |
|
|
806,841 |
|
|
|
|
|
|
|
Operating
income |
|
27,108 |
|
|
40,365 |
|
|
|
206,605 |
|
|
344,390 |
|
|
|
|
|
|
|
Other
income/(expense): |
|
|
|
|
|
Interest income |
|
3,338 |
|
|
816 |
|
|
|
6,568 |
|
|
3,493 |
|
Interest expense |
|
(139 |
) |
|
(119 |
) |
|
|
(394 |
) |
|
(479 |
) |
Other income, net |
|
667 |
|
|
1,996 |
|
|
|
2,500 |
|
|
7,108 |
|
Total other income |
|
3,866 |
|
|
2,693 |
|
|
|
8,674 |
|
|
10,122 |
|
|
|
|
|
|
|
Income before income taxes |
|
30,974 |
|
|
43,058 |
|
|
|
215,279 |
|
|
354,512 |
|
(Provision for)/benefit from income taxes |
|
(3,215 |
) |
|
1,170 |
|
|
|
(31,381 |
) |
|
(36,689 |
) |
Net income including controlling
interest |
|
27,759 |
|
|
44,228 |
|
|
|
183,898 |
|
|
317,823 |
|
Less: net (income)/loss attributable to controlling interest |
|
(3 |
) |
|
(37 |
) |
|
|
189 |
|
|
(7,596 |
) |
Net income attributable
to Dolby Laboratories, Inc. |
$ |
27,756 |
|
$ |
44,191 |
|
|
$ |
184,087 |
|
$ |
310,227 |
|
|
|
|
|
|
|
Net income per share: |
|
|
|
|
|
Basic |
$ |
0.29 |
|
$ |
0.44 |
|
|
$ |
1.84 |
|
$ |
3.07 |
|
Diluted |
$ |
0.28 |
|
$ |
0.42 |
|
|
$ |
1.81 |
|
$ |
2.97 |
|
Weighted-average shares
outstanding: |
|
|
|
|
|
Basic |
|
97,077 |
|
|
101,227 |
|
|
|
99,990 |
|
|
101,190 |
|
Diluted |
|
98,461 |
|
|
104,369 |
|
|
|
101,983 |
|
|
104,622 |
|
DOLBY LABORATORIES,
INC.CONSOLIDATED BALANCE SHEETS(in
thousands; unaudited)
|
September 30,2022 |
September 24,2021 |
ASSETS |
|
|
Current assets: |
|
|
Cash and cash equivalents |
$ |
620,127 |
|
$ |
1,225,380 |
|
Restricted cash |
|
8,244 |
|
|
7,652 |
|
Short-term investments |
|
189,213 |
|
|
38,839 |
|
Accounts receivable, net |
|
243,593 |
|
|
232,609 |
|
Contract assets, net |
|
176,093 |
|
|
182,316 |
|
Inventories, net |
|
23,549 |
|
|
10,965 |
|
Prepaid expenses and other current assets |
|
50,075 |
|
|
62,737 |
|
Total current assets |
|
1,310,894 |
|
|
1,760,498 |
|
Long-term investments |
|
102,514 |
|
|
62,819 |
|
Property, plant and equipment, net |
|
513,481 |
|
|
534,381 |
|
Operating lease right-of-use assets |
|
46,530 |
|
|
67,128 |
|
Goodwill and intangible assets, net |
|
477,412 |
|
|
463,584 |
|
Deferred taxes |
|
183,568 |
|
|
156,020 |
|
Other non-current assets |
|
55,149 |
|
|
61,257 |
|
Total
assets |
$ |
2,689,548 |
|
$ |
3,105,687 |
|
|
|
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
Current liabilities: |
|
|
Accounts payable |
$ |
14,171 |
|
$ |
17,779 |
|
Accrued liabilities |
|
230,237 |
|
|
262,728 |
|
Income taxes payable |
|
1,265 |
|
|
1,334 |
|
Contract liabilities |
|
18,588 |
|
|
18,473 |
|
Operating lease liabilities |
|
13,257 |
|
|
15,403 |
|
Total current liabilities |
|
277,518 |
|
|
315,717 |
|
Non-current contract liabilities |
|
23,203 |
|
|
23,713 |
|
Non-current operating lease liabilities |
|
37,685 |
|
|
56,715 |
|
Other non-current liabilities |
|
100,122 |
|
|
105,310 |
|
Total liabilities |
|
438,528 |
|
|
501,455 |
|
|
|
|
Stockholders’ equity: |
|
|
Class A common stock |
|
53 |
|
|
59 |
|
Class B common stock |
|
41 |
|
|
41 |
|
Retained earnings |
|
2,297,730 |
|
|
2,607,909 |
|
Accumulated other comprehensive loss |
|
(51,641 |
) |
|
(10,030 |
) |
Total stockholders’ equity –
Dolby Laboratories, Inc. |
|
2,246,183 |
|
|
2,597,979 |
|
Controlling interest |
|
4,837 |
|
|
6,253 |
|
Total stockholders’ equity |
|
2,251,020 |
|
|
2,604,232 |
|
Total liabilities and
stockholders’ equity |
$ |
2,689,548 |
|
$ |
3,105,687 |
|
DOLBY LABORATORIES,
INC.CONSOLIDATED STATEMENTS OF CASH
FLOWS(in thousands; unaudited)
|
Fiscal Year Ended |
|
September 30,2022 |
September 24,2021 |
Operating
activities: |
|
|
Net income including controlling interest |
$ |
183,898 |
|
$ |
317,823 |
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
Depreciation and amortization |
|
88,461 |
|
|
95,860 |
|
Stock-based compensation |
|
114,925 |
|
|
99,698 |
|
Amortization of operating lease right-of-use assets |
|
15,148 |
|
|
16,897 |
|
Amortization of premium on investments |
|
1,440 |
|
|
1,373 |
|
Provision for/(benefit from) credit losses |
|
5,460 |
|
|
(2,889 |
) |
Deferred income taxes |
|
(29,465 |
) |
|
(37,048 |
) |
Gain on sale of assets |
|
— |
|
|
(13,871 |
) |
Other non-cash items affecting net income |
|
(5,037 |
) |
|
(5,452 |
) |
Changes in operating assets and liabilities: |
|
|
Accounts receivable, net |
|
(14,314 |
) |
|
(49,034 |
) |
Contract assets, net |
|
6,300 |
|
|
(21,154 |
) |
Inventories |
|
(11,759 |
) |
|
17,154 |
|
Operating lease right-of-use assets |
|
266 |
|
|
(5,199 |
) |
Prepaid expenses and other assets |
|
8,760 |
|
|
17,165 |
|
Accounts payable and accrued liabilities |
|
(33,542 |
) |
|
44,230 |
|
Income taxes, net |
|
8,446 |
|
|
(2,975 |
) |
Contract liabilities |
|
(413 |
) |
|
2,361 |
|
Operating lease liabilities |
|
(15,399 |
) |
|
(11,369 |
) |
Other non-current liabilities |
|
(4,599 |
) |
|
(15,817 |
) |
Net cash provided by operating
activities |
|
318,576 |
|
|
447,753 |
|
|
|
|
Investing
activities: |
|
|
Purchases of marketable securities |
|
(311,313 |
) |
|
(67,101 |
) |
Proceeds from sales of marketable securities |
|
9,459 |
|
|
10,892 |
|
Proceeds from maturities of marketable securities |
|
108,546 |
|
|
53,893 |
|
Purchases of property, plant, and equipment |
|
(47,928 |
) |
|
(54,454 |
) |
Proceeds from sale of assets |
|
— |
|
|
16,365 |
|
Payments for business combinations, net of cash acquired |
|
(38,171 |
) |
|
(4,500 |
) |
Purchases of intangible assets |
|
(11,528 |
) |
|
— |
|
Purchases of other investments |
|
(5,000 |
) |
|
— |
|
Net cash used in investing
activities |
|
(295,935 |
) |
|
(44,905 |
) |
|
|
|
Financing
activities: |
|
|
Proceeds from issuance of common stock |
|
57,848 |
|
|
122,088 |
|
Repurchase of common stock |
|
(530,486 |
) |
|
(245,864 |
) |
Payment of cash dividend |
|
(100,067 |
) |
|
(89,172 |
) |
Distribution to controlling interest |
|
(1,435 |
) |
|
(7,362 |
) |
Shares repurchased for tax withholdings on vesting of restricted
stock |
|
(36,418 |
) |
|
(32,205 |
) |
Net cash used in financing
activities |
|
(610,558 |
) |
|
(252,515 |
) |
|
|
|
Effect of foreign exchange rate changes on cash, cash equivalents,
and restricted cash |
|
(16,744 |
) |
|
2,720 |
|
Net increase/(decrease) in cash,
cash equivalents, and restricted cash |
|
(604,661 |
) |
|
153,053 |
|
Cash, cash equivalents, and
restricted cash at beginning of period |
|
1,233,032 |
|
|
1,079,979 |
|
Cash, cash equivalents, and
restricted cash at end of period |
$ |
628,371 |
|
$ |
1,233,032 |
|
GAAP to Non-GAAP Reconciliations |
(in millions, except per share data; unaudited) |
|
|
|
|
|
|
|
|
|
The following
tables present Dolby's GAAP financial measures reconciled to the
non-GAAP financial measures included in this release for the fourth
quarter and fiscal year ended September 30, 2022 and
September 24, 2021: |
|
|
|
|
|
|
|
|
|
Net
income: |
|
Fiscal Quarter Ended |
|
Fiscal Year Ended |
|
|
September 30,2022 |
|
September 24,2021 |
|
September 30,2022 |
|
September 24,2021 |
GAAP net income |
|
$ |
27.8 |
|
|
$ |
44.2 |
|
|
$ |
184.1 |
|
|
$ |
310.2 |
|
Stock-based
compensation(1) |
|
|
27.0 |
|
|
|
24.1 |
|
|
|
114.9 |
|
|
|
99.7 |
|
Amortization of
acquisition-related intangibles(2) |
|
|
1.8 |
|
|
|
2.7 |
|
|
|
9.1 |
|
|
|
10.2 |
|
Other operating income
adjustments |
|
|
— |
|
|
|
— |
|
|
|
34.4 |
|
|
|
(6.8 |
) |
Restructuring charges |
|
|
4.6 |
|
|
|
(0.7 |
) |
|
|
10.6 |
|
|
|
10.2 |
|
Income tax adjustments |
|
|
(8.4 |
) |
|
|
(9.9 |
) |
|
|
(33.2 |
) |
|
|
(40.2 |
) |
Non-GAAP net income |
|
$ |
52.8 |
|
|
$ |
60.4 |
|
|
$ |
319.9 |
|
|
$ |
383.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Stock-based compensation
included in above line items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of products and services |
|
$ |
0.4 |
|
|
$ |
0.5 |
|
|
$ |
1.7 |
|
|
$ |
2.1 |
|
Research and development |
|
|
8.6 |
|
|
|
7.3 |
|
|
|
37.1 |
|
|
|
29.7 |
|
Sales and marketing |
|
|
9.6 |
|
|
|
8.2 |
|
|
|
41.3 |
|
|
|
36.4 |
|
General and administrative |
|
|
8.4 |
|
|
|
8.1 |
|
|
|
34.8 |
|
|
|
31.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) Amortization of
acquisition-related intangibles included in above line items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of licensing |
|
$ |
— |
|
|
$ |
0.7 |
|
|
$ |
1.5 |
|
|
$ |
2.8 |
|
Cost of products and services |
|
|
0.9 |
|
|
|
0.9 |
|
|
|
3.1 |
|
|
|
3.6 |
|
Research and development |
|
|
0.1 |
|
|
|
0.1 |
|
|
|
0.5 |
|
|
|
0.4 |
|
Sales and marketing |
|
|
0.8 |
|
|
|
1.0 |
|
|
|
3.7 |
|
|
|
3.4 |
|
General and administrative |
|
|
— |
|
|
|
— |
|
|
|
0.3 |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share: |
|
|
Fiscal Quarter Ended |
|
|
|
Fiscal Year Ended |
|
|
|
|
September 30,2022 |
|
|
|
September 24,2021 |
|
|
|
September 30,2022 |
|
|
|
September 24,2021 |
|
GAAP diluted earnings per
share |
|
$ |
0.28 |
|
|
$ |
0.42 |
|
|
$ |
1.81 |
|
|
$ |
2.97 |
|
Stock-based compensation |
|
|
0.27 |
|
|
|
0.22 |
|
|
|
1.13 |
|
|
|
0.95 |
|
Amortization of
acquisition-related intangibles |
|
|
0.02 |
|
|
|
0.04 |
|
|
|
0.09 |
|
|
|
0.10 |
|
Other operating income
adjustments |
|
|
— |
|
|
|
— |
|
|
|
0.34 |
|
|
|
(0.08 |
) |
Restructuring charges |
|
|
0.05 |
|
|
|
(0.01 |
) |
|
|
0.10 |
|
|
|
0.10 |
|
Income tax adjustments |
|
|
(0.08 |
) |
|
|
(0.09 |
) |
|
|
(0.33 |
) |
|
|
(0.38 |
) |
Non-GAAP diluted earnings per
share |
|
$ |
0.54 |
|
|
$ |
0.58 |
|
|
$ |
3.14 |
|
|
$ |
3.66 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted-average shares
outstanding - diluted |
|
|
98 |
|
|
|
104 |
|
|
|
102 |
|
|
|
105 |
|
The following
tables present a reconciliation between GAAP and non-GAAP versions
of the estimated financial amounts for the first quarter of fiscal
2023 and fiscal 2023 included in this release: |
|
|
|
|
|
Operating expenses: |
|
|
Q1 2023 |
|
|
|
Fiscal 2023 |
|
GAAP operating expenses (low -
high end of range) |
|
|
$214 - $224 |
|
|
|
(2%) +/- year-over-year |
|
Stock-based compensation |
|
|
(33 |
) |
|
|
(124 |
) |
Amortization of
acquisition-related intangibles |
|
|
(1 |
) |
|
|
(4 |
) |
Non-GAAP operating expenses
(low - high end of range) |
|
|
$180 - $190 |
|
|
|
+2% +/- year-over-year |
|
Operating
margin: |
|
Fiscal 2023 |
GAAP operating margin (low - high end of range) |
|
19% +/- |
|
Stock-based compensation |
|
10 % |
|
Amortization of
acquisition-related intangibles |
|
1 % |
|
Non-GAAP operating margin (low
- high end of range) |
|
30% +/- |
|
Effective tax rate: |
|
|
Q1 2023 |
|
GAAP effective tax rate (low -
high end of range) |
|
|
22% - 24% |
|
Stock-based compensation (low
- high end of range) |
|
|
(2%) - (1%) |
|
Amortization of
acquisition-related intangibles (low - high end of range) |
|
|
(1%) - 0% |
|
Other (low - high end of
range) |
|
|
(1%) - 0% |
|
Non-GAAP effective tax rate
(low - high end of range) |
|
|
19% - 21% |
|
Diluted earnings per
share: |
|
Q1 2023 |
|
|
Low |
|
High |
GAAP diluted earnings per share |
|
$ |
0.46 |
|
|
$ |
0.61 |
|
Stock-based compensation |
|
|
0.34 |
|
|
|
0.34 |
|
Amortization of
acquisition-related intangibles |
|
|
0.02 |
|
|
|
0.02 |
|
Income tax adjustments |
|
|
(0.06 |
) |
|
|
(0.06 |
) |
Non-GAAP diluted earnings per
share |
|
$ |
0.76 |
|
|
$ |
0.91 |
|
|
|
|
|
|
|
|
|
|
Weighted-average shares
outstanding - diluted |
|
|
99 |
|
|
|
99 |
|
|
|
|
|
|
|
|
|
|
Investor Contact:Maggie O’DonnellDolby
Laboratories914-267-7390investor@dolby.com
Media Contact:Karen HartquistDolby
Laboratories,
Inc.415-505-8357karen.hartquist@dolby.com
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