Research
Research Alert: Dlb: Results Near Street, Fy Guidance Maintained Despite Near-term Pressure
CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:Dolby delivered resilient Q2 FY 26 (Mar-Q) results with sales of $396M (+7% Y/Y) and non-GAAP EPS of $1.37, modestly beating consensus expectations of $386M/$1.34 despite macroeconomic uncertainties pressuring consumer electronics. Broadcast exhibited the strongest growth at $119M (+26.5% Y/Y), representing 32% of licensing revenue, while Mobile softened to $94.2M (-6% Y/Y), a notable shift from 22% growth in Q1. Profitability showed pressure with gross margins declining to 88.7% from 90.3% and operating margins compressing to 28.5% from 29.2%. Q3 guidance disappointed with midpoints of $310M revenue/$0.635 EPS, well below consensus ($344M/$0.98), though FY 26 guidance was maintained at $1.40B-$1.45B revenue/$4.30-$4.45 EPS, near expectations ($1.42B/$4.39). We expect Mobile to see challenges from the memory shortage, though minimum volume commitments provide some insulation. Given Q3's weak outlook, we worry management is overly optimistic about Q4 volumes, especially as memory supply remains constrained.
$DLB
