Dolby Laboratories (DLB) Stock Forecast & Price Target

Dolby Laboratories reported total revenues of $307.0 million, representing a year-over-year increase of approximately 1%, which aligns with financial estimates. The company demonstrated improved operating margins of 33.2% for the full year, up from 31.2% in the prior fiscal year, reflecting enhanced operational efficiency. Notably, total revenue for the year increased by 5.9% year-over-year, driven by the strong performance of licensing revenue and product/services, which were up 5.6% and 10%, respectively, indicating a robust demand for Dolby's technologies amidst market fluctuations.

Dolby Laboratories Inc. is projecting a decline in revenues for fiscal 2026, anticipating a high-single-digit drop that mirrors the decline experienced in fiscal 2025. The company's adjusted estimates for Q1 show a significant reduction in expected revenue and earnings per share, shifting from $380.4 million and $1.21 to $330.7 million and $0.87, indicating a weakening financial outlook. Additionally, gross margins have decreased slightly from 90.1% to 89.7%, exacerbated by challenges in device volumes since the pandemic, which continues to impact foundational revenues negatively.