Dolby Beats Q1, Raises FY 2026 Outlook on Accelerating Auto Strategy

Overview

• Dolby reported Q1 revenue of $347 million and non‑GAAP EPS of $1.06, both above guidance, and lifted full‑year targets to $1.4–$1.45 billion in revenue and $4.30–$4.45 in EPS.
• Management said the upside was driven mainly by earlier‑than‑expected deal timing and a $7 million shipment true‑up, with an expected 50–100 bps operating margin improvement for the year.
• Automotive expansion advanced with a new integration of Dolby Atmos and Dolby Vision into Qualcomm’s Gen 5 Snapdragon Automotive platform and partnerships now spanning more than 35 OEMs.
• Commercial traction included Mahindra’s first SUV in India with Dolby Atmos and Dolby Vision and Hyundai’s first Dolby Atmos car, a crossover SUV in China.
• The company generated about $55 million in operating cash flow, repurchased $70 million of stock, declared a $0.36 dividend up 9%, ended with roughly $730 million in cash and investments, and recorded a $10 million restructuring charge.