|By Business Wire||
|April 29, 2014 04:08 PM EDT||
Dolby Laboratories, Inc. (NYSE:DLB) today announced the Company’s financial results for the second quarter (Q2) of fiscal year 2014. For the second quarter, Dolby reported total revenue of $278.6 million, compared to $249.3 million for the second quarter of fiscal year 2013.
Second quarter GAAP net income was $75.9 million, or $0.73 per diluted share, compared to $61.9 million, or $0.60 per diluted share, for the second quarter of fiscal 2013. On a non-GAAP basis, second quarter net income was $91.7 million, or $0.88 per diluted share, compared to $76.4 million, or $0.74 per diluted share, for the second quarter of fiscal 2013. Dolby’s non-GAAP measures are described and reconciled to the corresponding GAAP measures at the end of this release.
“We’re pleased to report our second quarter results with revenues higher than forecast,” said Kevin Yeaman, President and CEO, Dolby Laboratories. “Our broadcast business continues to outperform, and we are excited to work with great partners creating amazing consumer products such as the Sony PlayStation 4, Microsoft Xbox One, and the recently unveiled Amazon Fire TV.”
Dolby estimates that total revenue will range from $205 million to $215 million. Gross margin percentages are projected to range between approximately 91% to 92% on a GAAP basis and 92% to 93% on a non-GAAP basis.
Dolby anticipates that operating expenses will be between approximately $153 million and $158 million on a GAAP basis and between $135 million and $140 million on a non-GAAP basis.
Dolby expects diluted earnings per share to be between $0.24 and $0.29 on a GAAP basis and between $0.38 and $0.43 on a non-GAAP basis.
The Company estimates that its fiscal Q3 2014 effective tax rate will be between approximately 27% and 28% on both a GAAP and non-GAAP basis.
FISCAL YEAR 2014
Dolby anticipates that total revenue will range from $930 million to $950 million.
Dolby anticipates that operating expenses will be between approximately $611 million and $616 million on a GAAP basis and between $535 million and $540 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 Q2 fiscal 2014 financial results for Dolby Laboratories at 2:00 p.m. PT (5:00 p.m. ET) on Tuesday, April 29, 2014. Access to the teleconference will be available over the Internet from http://investor.dolby.com/medialist.cfm or by dialing 1-888-599-4876. International callers can access the conference call at 1-913-312-1485.
A replay of the call will be available from 5:00 p.m. PT on Tuesday, April 29, 2014, until 9:00 p.m. PT on Tuesday, May 6, 2014, by dialing 1-877-870-5176 (international callers can access the replay by dialing 1-858-384-5517) and entering the confirmation code 1121212. 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 certain non-GAAP financial measures. 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 US Securities and Exchange Commission (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 Q3 2014 and fiscal 2014 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; the loss of, or reduction in sales by, a key customer or licensee; pricing pressures; risks associated with the rate at which 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; risks associated with acquiring and successfully integrating businesses or technologies; and other risks detailed in Dolby’s US 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 (NYSE:DLB) creates audio, video, and voice technologies that transform entertainment and communications in mobile devices, at the cinema, at home, and at work. For nearly 50 years, sight and sound experiences have become more vibrant, clear, and powerful in Dolby. For more information, please visit www.dolby.com.
Dolby and the double-D symbol are registered trademarks of Dolby Laboratories. All other trademarks remain the property of their respective owners. S14/27979 DLB-F
|DOLBY LABORATORIES, INC.|
|INTERIM 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||3,742||6,409||7,743||9,489|
|Cost of products||10,293||13,206||24,081||31,695|
|Cost of services||3,470||3,668||7,063||7,704|
|Total cost of revenue||17,505||23,283||38,887||48,888|
|Research and development||44,798||41,948||89,261||84,384|
|Sales and marketing||64,828||58,130||125,207||116,551|
|General and administrative||46,457||41,803||88,365||84,911|
|Total operating expenses||156,169||141,881||306,134||285,846|
|Other income/(expense), net||(2,823||)||188||(2,594||)||901|
|Total other income/expense||(1,996||)||690||(1,225||)||2,717|
|Income before income taxes||102,922||84,872||163,623||153,931|
|Provision for income taxes||(26,373||)||(22,633||)||(41,828||)||(40,215||)|
|Net income including controlling interest||76,549||62,239||121,795||113,716|
|Less: net (income) attributable to controlling interest||(681||)||(328||)||(1,412||)||(456||)|
|Net income attributable to Dolby Laboratories, Inc.||$||75,868||$||61,911||$||120,383||$||113,260|
|Net Income Per Share:|
|Weighted-Average Shares Outstanding:|
|DOLBY LABORATORIES, INC.|
|INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS|
(in thousands, except share and per share amounts)
|Cash and cash equivalents||$||568,899||$||454,397|
|Accounts receivable, net||109,143||97,460|
|Prepaid expenses and other current assets||24,377||28,949|
|Total current assets||967,394||818,579|
|Property, plant and equipment, net||242,970||242,917|
|Intangible assets, net||46,772||41,315|
|Other non-current assets||10,295||11,638|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Income taxes payable||9,148||3,394|
|Total current liabilities||176,482||172,815|
|Long-term deferred revenue||20,178||19,663|
|Other non-current liabilities||46,713||45,441|
|Class A common stock||50||47|
|Class B common stock||53||55|
|Additional paid-in capital||49,074||18,812|
|Accumulated other comprehensive income||8,694||7,814|
|Total stockholders’ equity – Dolby Laboratories, Inc.||1,632,636||1,481,110|
|Total stockholders’ equity||1,653,182||1,500,026|
|Total liabilities and stockholders’ equity||$||1,896,555||$||1,737,945|
|DOLBY LABORATORIES, INC.|
|INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS|
|Fiscal Quarter Ended||Fiscal Year-To-Date Ended|
|Net income including controlling interest||$||76,549||$||62,239||$||121,795||$||113,716|
|Adjustments to reconcile net income to net cash provided by operating activities:|
|Depreciation and amortization||12,705||13,291||25,114||26,420|
|Amortization of premium on investments||2,328||2,159||4,594||5,953|
|Excess tax benefit from exercise of stock options||(552||)||(180||)||(1,562||)||(649||)|
|Provision for doubtful accounts||133||449||507||270|
|Deferred income taxes||(4,980||)||(7,950||)||(6,302||)||(10,577||)|
|Other non-cash items affecting net income||2,838||(181||)||2,943||(872||)|
|Changes in operating assets and liabilities:|
|Prepaid expenses and other assets||492||(4,787||)||(1,139||)||4,129|
|Accounts payable and other liabilities||22,033||17,756||5,337||(2,142||)|
|Income taxes, net||8,591||(5,090||)||13,386||4,422|
|Other non-current liabilities||46||416||262||1,428|
|Net cash provided by operating activities||102,138||56,756||179,420||124,056|
|Purchase of investments||(76,113||)||(118,862||)||(178,830||)||(325,997||)|
|Proceeds from sales of investment securities||35,998||78,037||63,424||467,105|
|Proceeds from maturities of investment securities||34,663||13,625||81,402||64,950|
|Purchases of property, plant and equipment||(8,905||)||(5,447||)||(17,872||)||(12,164||)|
|Purchases of intangible assets||(12,400||)||(2||)||(12,400||)||(4,050||)|
|Proceeds from sale of property, plant and equipment and assets held for sale||—||357||42||376|
|Change in restricted cash||5||(937||)||(169||)||(1,228||)|
|Net cash provided by/(used in) investing activities||(26,752||)||(33,229||)||(64,403||)||188,992|
|Proceeds from issuance of common stock||9,337||2,700||17,464||7,202|
|Repurchase of common stock||—||(11,477||)||(11,660||)||(65,433||)|
|Payment of cash dividend||—||—||—||(408,206||)|
|Distribution to controlling interest||—||—||—||(5,039||)|
|Excess tax benefit from the exercise of stock options||552||180||1,562||649|
|Shares repurchased for tax withholdings on vesting of restricted stock||(1,631||)||(1,496||)||(8,358||)||(5,132||)|
|Net cash provided by/(used) in financing activities||8,258||(10,093||)||(992||)||(475,959||)|
|Effect of foreign exchange rate changes on cash and cash equivalents||615||(1,119||)||477||(1,181||)|
|Net increase/(decrease) in cash and cash equivalents||84,259||12,315||114,502||(164,092||)|
|Cash and cash equivalents at beginning of period||484,640||316,193||454,397||492,600|
|Cash and cash equivalents at end of period||$||568,899||$||328,508||$||568,899||$||328,508|
|GAAP to Non-GAAP Reconciliations|
|(In millions, except per share data)|
|The following tables present the Company's GAAP financial measures reconciled to the non-GAAP financial measures included in this release for the second quarter of fiscal 2014 and 2013:|
|Net income:||Fiscal Quarter Ended|
|GAAP net income||$||75.9||$||61.9|
|RSU dividend equivalent||0.9||2.2|
|Amortization of acquired intangibles||2.8||3.4|
|Restructuring charges, net||0.1||—|
|Income tax adjustments||(5.7||)||(6.0||)|
|Non-GAAP net income||$||91.7||$||76.4|
|Diluted earnings per share:||Fiscal Quarter Ended|
|GAAP diluted earnings per share||$||0.73||$||0.60|
|RSU dividend equivalent||0.01||0.02|
|Amortization of acquired intangibles||0.03||0.03|
|Restructuring charges, net||—||—|
|Income tax adjustments||(0.06||)||(0.06||)|
|Non-GAAP diluted earnings per share||$||0.88||$||0.74|
|Shares used in computing diluted earnings per share (in millions)||104||103|
|The following tables present a reconciliation between GAAP and non-GAAP versions of the estimated financial amounts for the third quarter of fiscal 2014 and fiscal year 2014 included in this release:|
|Gross margin:||Q3 2014|
|GAAP gross margin (low - high end of range)||
91% - 92
|Amortization of acquired intangibles||0.8||%|
|Non-GAAP gross margin (low - high end of range)||
92% - 93
|Operating expenses:||Q3 2014||Fiscal 2014|
|GAAP operating expenses (low - high end of range)||$153 - $158||$611 - $616|
|RSU dividend equivalent||(1||)||(3||)|
|Amortization of acquired intangibles||(1||)||(4||)|
|Restructuring charges, net||—||(3||)|
|Non-GAAP operating expenses (low - high end of range)||$135 - $140||$535 - $540|
|Diluted earnings per share:||Q3 2014|
|GAAP diluted earnings per share||$||0.24||$||0.29|
|RSU dividend equivalent||0.01||0.01|
|Amortization of acquired intangibles||0.03||0.03|
|Income tax adjustments||(0.06||)||(0.06||)|
|Non-GAAP diluted earnings per share||$||0.38||$||0.43|
|Shares used in computing diluted earnings per share (in millions)||103||103|
Learn how you can use the CoSN SEND II Decision Tree for Education Technology to make sure that your K–12 technology initiatives create a more engaging learning experience that empowers students, teachers, and administrators alike.
Aug. 4, 2015 09:30 AM EDT Reads: 103
Mobile, social, Big Data, and cloud have fundamentally changed the way we live. “Anytime, anywhere” access to data and information is no longer a luxury; it’s a requirement, in both our personal and professional lives. For IT organizations, this means pressure has never been greater to deliver meaningful services to the business and customers.
Aug. 4, 2015 08:45 AM EDT Reads: 254
In a recent research, analyst firm IDC found that the average cost of a critical application failure is $500,000 to $1 million per hour and the average total cost of unplanned application downtime is $1.25 billion to $2.5 billion per year for Fortune 1000 companies. In addition to the findings on the cost of the downtime, the research also highlighted best practices for development, testing, application support, infrastructure, and operations teams.
Aug. 4, 2015 07:00 AM EDT Reads: 222
"We've just seen a huge influx of new partners coming into our ecosystem, and partners building unique offerings on top of our API set," explained Seth Bostock, Chief Executive Officer at IndependenceIT, in this SYS-CON.tv interview at 16th Cloud Expo, held June 9-11, 2015, at the Javits Center in New York City.
Aug. 3, 2015 11:00 PM EDT Reads: 698
SYS-CON Events announced today that HPM Networks will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. For 20 years, HPM Networks has been integrating technology solutions that solve complex business challenges. HPM Networks has designed solutions for both SMB and enterprise customers throughout the San Francisco Bay Area.
Aug. 3, 2015 06:45 PM EDT Reads: 541
Container technology is sending shock waves through the world of cloud computing. Heralded as the 'next big thing,' containers provide software owners a consistent way to package their software and dependencies while infrastructure operators benefit from a standard way to deploy and run them. Containers present new challenges for tracking usage due to their dynamic nature. They can also be deployed to bare metal, virtual machines and various cloud platforms. How do software owners track the usag...
Aug. 3, 2015 04:00 PM EDT Reads: 284
As Marc Andreessen says software is eating the world. Everything is rapidly moving toward being software-defined – from our phones and cars through our washing machines to the datacenter. However, there are larger challenges when implementing software defined on a larger scale - when building software defined infrastructure. In his session at 16th Cloud Expo, Boyan Ivanov, CEO of StorPool, provided some practical insights on what, how and why when implementing "software-defined" in the datacent...
Aug. 3, 2015 03:45 PM EDT
As organizations shift towards IT-as-a-service models, the need for managing and protecting data residing across physical, virtual, and now cloud environments grows with it. CommVault can ensure protection and E-Discovery of your data – whether in a private cloud, a Service Provider delivered public cloud, or a hybrid cloud environment – across the heterogeneous enterprise. In his session at 17th Cloud Expo, Randy De Meno, Chief Technologist - Windows Products and Microsoft Partnerships at Com...
Aug. 3, 2015 03:30 PM EDT
SYS-CON Events announced today that VividCortex, the monitoring solution for the modern data system, will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. The database is the heart of most applications, but it’s also the part that’s hardest to scale, monitor, and optimize even as it’s growing 50% year over year. VividCortex is the first unified suite of database monitoring tools specifically desi...
Aug. 3, 2015 03:15 PM EDT
The Software Defined Data Center (SDDC), which enables organizations to seamlessly run in a hybrid cloud model (public + private cloud), is here to stay. IDC estimates that the software-defined networking market will be valued at $3.7 billion by 2016. Security is a key component and benefit of the SDDC, and offers an opportunity to build security 'from the ground up' and weave it into the environment from day one. In his session at 16th Cloud Expo, Reuven Harrison, CTO and Co-Founder of Tufin,...
Aug. 3, 2015 03:00 PM EDT Reads: 565
In their session at 17th Cloud Expo, Hal Schwartz, CEO of Secure Infrastructure & Services (SIAS), and Chuck Paolillo, CTO of Secure Infrastructure & Services (SIAS), provide a study of cloud adoption trends and the power and flexibility of IBM Power and Pureflex cloud solutions. In his role as CEO of Secure Infrastructure & Services (SIAS), Hal Schwartz provides leadership and direction for the company.
Aug. 3, 2015 12:30 PM EDT Reads: 214
SYS-CON Events announced today that MobiDev, a software development company, will exhibit at the 17th International Cloud Expo®, which will take place November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. MobiDev is a software development company with representative offices in Atlanta (US), Sheffield (UK) and Würzburg (Germany); and development centers in Ukraine. Since 2009 it has grown from a small group of passionate engineers and business managers to a full-scale mobi...
Aug. 3, 2015 09:45 AM EDT Reads: 374
There are many considerations when moving applications from on-premise to cloud. It is critical to understand the benefits and also challenges of this migration. A successful migration will result in lower Total Cost of Ownership, yet offer the same or higher level of robustness. In his session at 15th Cloud Expo, Michael Meiner, an Engineering Director at Oracle, Corporation, analyzed a range of cloud offerings (IaaS, PaaS, SaaS) and discussed the benefits/challenges of migrating to each offe...
Aug. 3, 2015 07:30 AM EDT Reads: 198
Digital Transformation is the ultimate goal of cloud computing and related initiatives. The phrase is certainly not a precise one, and as subject to hand-waving and distortion as any high-falutin' terminology in the world of information technology. Yet it is an excellent choice of words to describe what enterprise IT—and by extension, organizations in general—should be working to achieve. Digital Transformation means: handling all the data types being found and created in the organizat...
Aug. 2, 2015 06:00 PM EDT Reads: 1,144
Chuck Piluso presented a study of cloud adoption trends and the power and flexibility of IBM Power and Pureflex cloud solutions. Prior to Secure Infrastructure and Services, Mr. Piluso founded North American Telecommunication Corporation, a facilities-based Competitive Local Exchange Carrier licensed by the Public Service Commission in 10 states, serving as the company's chairman and president from 1997 to 2000. Between 1990 and 1997, Mr. Piluso served as chairman & founder of International Te...
Aug. 2, 2015 04:00 PM EDT Reads: 443