Dolby Labs Stock Surges Pre-Market On Q4 Earnings Beat, FY25 Outlook: Retail Sentiment Brightens
By Stocktwits Inc | First Published Nov 20, 2024, 8:12 PM ISTDolby CEO says he is excited about the company’s opportunity with Dolby.io, which is well positioned to provide real time interactive experiences for sports and entertainment.
Dolby Labs, Inc. ($DLB) shares climbed solidly in premarket trading on Wednesday after the San Francisco, California-based company announced mixed fourth-quarter results but issued upbeat forward guidance.
Dolby Labs, a developer of audio, imaging and voice technologies for cinema, home theaters, PCs, mobile phones, and games, reported fiscal year 2024 fourth-quarter non-GAAP earnings per share (EPS) of $0.81. This exceeded the year-ago quarter’s $0.65 and the consensus estimate of $0.44.
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Revenue rose 4.81% year-on-year (YoY) to $305 million, which missed the consensus estimate of $307.94 million.
Kevin Yeaman, CEO of Dolby said he was pleased with the progress the company made in 2024.
The bottom-line growth outpaced the revenue growth as the company reined in both direct and indirect expenses. Cost of revenue and operating expenses fell 4.83% and 13.17%, respectively. The operating expense reduction primarily reflected a $30.60 million in restructuring charges, which dragged the year-ago quarter’s performance.
Dolby guided first quarter revenue and adjusted EPS to $330 million-$360 million and $0.96-$1.11. Analysts, on average, estimate the metrics to come in at $337.96 million and $1.09, respectively, according to Yahoo Finance.
For the fiscal year 2025, the company forecasts revenue of $1.33 billion-$1.39 billion and adjusted EPS of $3.99-$4.14, ahead of the consensus estimates of $1.33 billion and $3.80, respectively.
Yeaman said, “As we enter fiscal 2025, we have strong momentum with Dolby Atmos and Dolby Vision, our imaging patent portfolio has gotten stronger with the GE Licensing acquisition, and we are excited about our opportunity with Dolby.io, which is well positioned to provide real time interactive experiences for sports and entertainment.”
In premarket trading, as of 8:51 am ET, Dolby shares climbed 12.97% to $80.11, marking the highest level since late-July. The stock has underperformed so far this year, having lost nearly 17%.
On Stocktwits, sentiment toward Dolby has flipped from ‘bearish’ (32/100) a day ago to ‘extremely bullish’ (88/100), with message volume rising to ‘extremely high.’
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