DLB tumbled 23% after Q1 revenue of $315.8M missed estimates and Q2 guidance of $280M-$310M fell well short of the $350.9M consensus. Licensing revenue slipped 4%.
Dolby Laboratories shares fell 23% on Thursday after the audio technology company missed Wall Street revenue estimates for its fiscal first quarter and issued a second-quarter forecast well below analyst expectations.
The San Francisco-based company reported fiscal Q1 revenue of $315.8 million, down from $325.3 million a year earlier and short of the $330.5 million consensus compiled by Bloomberg. Adjusted earnings per share came in at $1.05, beating the $0.93 analyst estimate.
Licensing revenue, which accounts for the bulk of Dolby's sales, fell 4% to $277.4 million. The company cited lower royalty revenue from the consumer electronics and PC segments. Product revenue dropped 13% to $29.4 million.
For the fiscal second quarter ending in March, Dolby forecast revenue of $280 million to $310 million, well below the $350.9 million analysts were expecting. The company projected adjusted EPS of $0.67 to $0.77, also below the $0.90 consensus.
Dolby's stock market analysis page carries an Alpha Score of 40 out of 100, labeled Mixed, reflecting the company's position in the industrials sector.
Management pointed to ongoing weakness in the consumer electronics market and a shift in licensing mix toward lower-royalty products. The company maintained its full-year revenue outlook of $1.25 billion to $1.35 billion, suggesting it expects a second-half recovery. Chief Financial Officer Robert Park said the Q2 guidance reflects "the timing of certain license renewals and product launches."
The stock closed at $68.41, its lowest level since March 2023. Dolby has lost roughly $3 billion in market value over the session.
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