Dolby Laboratories Reports Third Quarter Fiscal 2013 Financial Results
Jul 25th 2013 5:54PM
Updated Jul 25th 2013 6:08PM
Dolby Laboratories Reports Third Quarter Fiscal 2013 Financial Results
SAN FRANCISCO--(BUSINESS WIRE)-- Dolby Laboratories, Inc. (NYS: DLB) today announced the Company's financial results for the third quarter of fiscal year 2013. For the third quarter, Dolby reported total revenue of $207.1 million, compared to $210.3 million for the third quarter of fiscal year 2012.
Third quarter GAAP net income was $30.2 million, or $0.29 per diluted share, compared to $51.5 million, or $0.48 per diluted share, for the third quarter of fiscal 2012. On a non-GAAP basis, third quarter net income was $48.5 million, or $0.47 per diluted share, compared to $60.8 million, or $0.57 per diluted share, for the third quarter of fiscal 2012. Dolby's non-GAAP measures are described and reconciled to the corresponding GAAP measures at the end of this release.
"Licensing revenue increased year over year, with growth in our mobile and broadcast businesses offsetting weaker demand for PCs and consumer electronics this quarter," said Kevin Yeaman, President and CEO, Dolby Laboratories. "While the current consumer-spending environment is weak, we continue to make solid progress on our long-term growth initiatives."
Dolby anticipates total revenue for the fourth quarter (Q4) of fiscal year 2013 to range from $205 million to $215 million. Gross margin percentages are projected to be approximately 90% on a GAAP basis and 91% on a non-GAAP basis.
Dolby anticipates that operating expenses will be approximately $142 million on a GAAP basis and $124 million on a non-GAAP basis.
Dolby expects diluted earnings per share to be between $0.30 and $0.36 on a GAAP basis and between $0.45 and $0.51 on a non-GAAP basis.
The Company estimates that its fiscal Q4 2013 effective tax rate will range from 27% to 28% on both a GAAP and non-GAAP basis.
FISCAL YEAR 2013
Dolby now anticipates that total revenue for fiscal year 2013 will range from $900 million to $910 million.
Dolby now anticipates that operating expenses will be approximately $574 million on a GAAP basis and $496 million on a non-GAAP basis.
The Company's Conference Call Information
Members of Dolby management will lead a conference call open to all interested parties to discuss Dolby Laboratories' third quarter fiscal 2013 financial results at 2:00 p.m. PT (5:00 p.m. ET) on Thursday, July 25, 2013. Access to the teleconference will be available over the Internet from http://investor.dolby.com/medialist.cfm or by dialing 1-888-329-8903. International callers can access the conference call at 1-719-457-2601.
A replay of the call will be available from 5:00 p.m. PT on Thursday, July 25, 2013, until 9:00 p.m. PT on Thursday, August 1, 2013, by dialing 1-877-870-5176 (international callers can access the replay by dialing 1-858-384-5517) and entering the confirmation code 3172721. An archived version of the teleconference will also be available on the Dolby Laboratories website, www.dolby.com.
Non-GAAP Financial Information
To supplement Dolby's financial statements presented on a GAAP basis, Dolby provides non-GAAP financial measures of gross margin, operating expense, net income, and diluted earnings per share. These measures are adjusted to exclude amounts related to stock-based compensation, expense associated with dividend equivalents paid on restricted stock units, the amortization of intangibles from business combinations, restructuring charges, and the related tax impact of these items. Dolby presents non-GAAP financial measures in reporting its financial results to provide investors with 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. Dolby's management believes it is useful for itself and investors to review both GAAP and non-GAAP measures in order to assess the performance of Dolby's business for planning and forecasting in subsequent periods. Dolby's management does not itself, nor does it suggest that investors should, consider non-GAAP financial measures in isolation from, 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. Investors are also encouraged to review Dolby's GAAP financial statements as reported in its SEC filings. A reconciliation between GAAP and non-GAAP financial measures is provided at the end of this press release and on Dolby's investor relations website at http://investor.dolby.com/medialist.cfm.
Certain statements in this press release, including, but not limited to, statements relating to Dolby's expected financial results for Q4 2013 and fiscal 2013 and Dolby's long-term growth initiatives are "forward-looking statements" that are subject to 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 projected. The following important factors, without limitation, could cause actual results to differ materially from those in the forward-looking statements: risks associated with trends in the markets in which Dolby operates, including the personal computer, DVD, and Blu-ray Disc™, broadcast, consumer electronics, gaming, mobile, and automobile markets; pricing pressures; risks associated with the rate at which original equipment manufacturers (OEMs) include optical disc playback in Windows® 8 devices and the rate of consumer adoption of Windows operating systems; risks that a shift from disc-based media to online media content could result in fewer devices with Dolby® technologies; risks associated with the effects of macroeconomic conditions, including trends in consumer spending; risks relating to the expiration of patents; the timing of Dolby's receipt of royalty reports and payments from its licensees; Dolby's accuracy of calculation of royalties due to its licensors; Dolby's ability to develop, maintain, and strengthen relationships with industry participants; Dolby's ability to develop and deliver innovative technologies in response to new and growing markets in the entertainment industry; 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; the development and growth of the market for digital cinema and digital 3D and Dolby's ability to successfully penetrate this market; Dolby's ability to expand its business generally, and to expand its business beyond sound technologies to other technologies related to digital entertainment delivery, by acquiring and successfully integrating businesses or technologies; and other risks detailed in Dolby's Securities and Exchange Commission filings and reports, including the risks identified under the section captioned "Risk Factors" in its most recent quarterly report on Form 10-Q. 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 (NYS: DLB) is the global leader in technologies that are essential elements in the best entertainment experiences. Founded in 1965 and best known for high-quality audio and surround sound in environments from the cinema to the living room to mobile devices, Dolby creates innovations that enrich entertainment at the movies, at home, or on the go. For more information about Dolby Laboratories or Dolby technologies, please visit www.dolby.com.
Dolby and the double-D symbol are registered trademarks of Dolby Laboratories. Blu-ray Disc is a trademark of the Blu-ray Disc Association. Windows is a registered trademark of Microsoft Corporation. S13 /27158DLB-F
|DOLBY LABORATORIES, INC.|
|CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS|
(in thousands, except per share amounts)
|Fiscal Quarter Ended||Fiscal Year-to-Date Ended|
|Cost of revenue:|
|Cost of licensing||4,053||2,892||13,542||9,523|
|Cost of products||16,269||14,529||47,964||46,052|
|Cost of services||4,018||3,610||11,722||9,458|
|Total cost of revenue||24,340||21,031||73,228||65,033|
|Research and development||42,915||35,123||127,299||102,185|
|Sales and marketing||58,528||49,269||175,079||138,779|
|General and administrative||38,413||36,859||123,324||109,605|
|Restructuring charges / (credits)||5,930||(85||)||5,930||1,193|
|Total operating expenses||145,786||121,166||431,632||351,762|
|Other income, net||156||709||1,057||969|
|Income before income taxes||37,847||70,321||191,778||296,040|
|Provision for income taxes||(7,345||)||(18,915||)||(47,560||)||(82,951||)|
|Net income including controlling interest||30,502||51,406||144,218||213,089|
|Less: net (income) / loss attributable to controlling interest||(286||)||123||(742||)||(281||)|
|Net income attributable to Dolby Laboratories, Inc.||$||30,216||$||51,529||$||143,476||$||212,808|
|Net income per share:|
|Weighted-average shares outstanding:|
|DOLBY LABORATORIES, INC.|
|CONDENSED CONSOLIDATED BALANCE SHEETS|
|Cash and cash equivalents||$||408,561||$||492,600|
|Accounts receivable, net||74,528||43,495|
|Prepaid expenses and other current assets||30,200||33,832|
|Total current assets||714,540||970,286|
|Property, plant and equipment, net||245,667||254,676|
|Intangible assets, net||44,736||56,526|
|Other non-current assets||11,827||13,687|
|LIABILITIES AND STOCKHOLDERS' EQUITY|
|Income taxes payable||1,012||2,424|
|Total current liabilities||152,244||156,840|
|Long-term deferred revenue||19,073||18,192|
|Other non-current liabilities||46,271||39,837|
|Class A common stock||47||46|
|Class B common stock||55||57|
|Additional paid-in capital||17,111||—|
|Accumulated other comprehensive income||5,812||10,687|
|Total stockholders' equity - Dolby Laboratories, Inc.||1,431,612||1,720,269|
|Total stockholders' equity||1,449,862||1,743,233|
|Total liabilities and stockholders' equity||$||1,667,450||$||1,960,798|