A perfect four-quarter earnings beat run with an average surprise of nearly 15%, strong 18% margins, and a high Piotroski score underpin a high-quality franchise that currently trades roughly 25% below the analyst consensus target — offering a risk/reward of approximately 4.6-to-1 in the buyer's favor — but a death cross is in place, the stock is in a confirmed downtrend with RSI near oversold, and 93% licensing concentration adds structural risk; timing is the primary near-term obstacle to expressing this value.
Thesis pillars
- High Quality Margins And Financials→Stable
- Perfect Earnings Beat Streak↑Improving
- Attractive Risk Reward Geometry↓Deteriorating
- +2 more pillars — see the Why tab for full reasoning
Dolby Laboratories (DLB) Stock Analysis
Falling Knife setup
Industrials · Specialty Business Services
Sell if holding. Momentum 2.4/10 is below the 5.0 floor at $58.56 — engine's falling-knife protection flags exit rather than catching a breakdown. Specifics: Concentration risk — Product: licensing (93.0%); Concentration risk — Supplier: sole source suppliers.
Dolby Laboratories licenses audio and video technologies — including Dolby Atmos, Dolby Vision, and audio codecs — to approximately 1,000 device manufacturers, generating 93% of fiscal 2025 revenue from licensing and 7% from cinema hardware and services. Per-unit royalties from... Read more
Sell if holding. Momentum 2.4/10 is below the 5.0 floor at $58.56 — engine's falling-knife protection flags exit rather than catching a breakdown. Specifics: Concentration risk — Product: licensing (93.0%); Concentration risk — Supplier: sole source suppliers. Chart setup: Death cross, below all MAs, RSI 38, MACD bearish. Score 5.7/10, moderate confidence.
Passes 6/8 gates (favorable risk/reward ratio, clean insider activity, no SEC red flags, earnings proximity 53d clear, semi cycle peak clear, materials cycle peak clear). Fails on weak momentum and death cross (50MA < 200MA). Suitability: moderate.
About Dolby Laboratories
About Dolby Laboratories
Dolby Laboratories derived 93% of fiscal 2025 revenue from licensing technology, brands, and patents to approximately 1,000 consumer electronics manufacturers globally. Broadcast markets (televisions and set-top boxes) represented 34% of licensing revenue in fiscal 2025, Mobile (smartphones and tablets) 22%, CE (Blu-ray, AVRs, soundbars) 12%, PC 12%, and Other markets including Dolby Cinema and Automotive 20%. The company held approximately 28,400 issued patents across more than 200 jurisdictions as of September 26, 2025, with 4,179 new patents issued in fiscal 2025.
Dolby earns licensing revenue through two channels: Branded Technology licensing (Dolby Atmos, Dolby Vision, DD+, and AC-4 codecs) sold to semiconductor manufacturers and OEMs under per-unit royalty, committed-volume, or fixed-fee arrangements, and Patent Licensing through pools administered by Access Advance, Sisvel, Via LA, and Vectis. Dolby holds majority ownership in Via LA alongside Philips and Mitsubishi. The licensing cycle typically runs in two stages — IC manufacturers embed Dolby technologies in chips, then OEM system manufacturers incorporate those chips and pay per-unit royalties. In fiscal 2025, Dolby shifted distribution of DD and DD+ codecs for Windows 11 24H2 PCs directly to PC OEMs, bypassing Microsoft's operating system channel. Products and services (7% of revenue) encompass cinema hardware including digital servers, audio processors, and amplifiers, plus Dolby Cinema box-office revenue-sharing. The company relies on sole source suppliers for certain components used in cinema hardware manufacturing.
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Dolby's issued patents expire between 2025 and 2047, and licensing agreements generally require licensees to pay full royalties only while patents remain in force in relevant markets. If pool licensees determine that pooled patents lack sufficient aggregate value, they may not renew their agreements — a risk that applies across Access Advance, Sisvel, Via LA, and Vectis pools. With approximately 6,100 pending patent applications as of September 26, 2025, the company's revenue sustainability depends on continued successful patent prosecution and active participation in international standards bodies including ETSI, ISO, IEC, and ITU.
See also: Industrials · Specialty Business Services
From Dolby Laboratories's most recent 10-K filing, extracted June 9, 2026.
Recent developments
updated 2026-09-26Recent Developments — Dolby Laboratories
Latest news
- NEWS Lazard Asset Management LLC Lowers Position in Dolby Laboratories $DLB - MarketBeat — MarketBeat neutral
- NEWS What To Expect From Dolby Laboratories’s (DLB) Q2 Earnings - StockStory — StockStory neutral
- NEWS What To Expect From Dolby Laboratories’s (DLB) Q2 Earnings - stockstory.org — stockstory.org neutral
- NEWS Vest Financial LLC Increases Stock Holdings in Dolby Laboratories $DLB - MarketBeat — MarketBeat positive
- NEWS Dolby Laboratories (DLB) Reports Q1: Everything You Need To Know Ahead Of Earnings - StockStory — StockStory neutral
Generated 2026-09-26T04:01:58Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- HIGHProductlicensing93%10-K Item 1: 'We generated 93% of our revenues in fiscal 2025 by licensing technology, brand, and patents'
- HIGHSuppliersole source suppliers10-K Item 1: 'we rely on sole source suppliers for certain components used to manufacture our products'
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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Rating Breakdown
1 floor-breaker
Price action weak — below key moving averages, no momentum carry. Needs a base before trend-continuation setups apply.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Sell if holding. Momentum 2.4/10 is below the 5.0 floor at $58.56 — engine's falling-knife protection flags exit rather than catching a breakdown. Specifics: Concentration risk — Product: licensing (93.0%); Concentration risk — Supplier: sole source suppliers. Chart setup: Death cross, below all MAs, RSI 38, MACD bearish. Prior stop was $54.76. Score 5.7/10, moderate confidence.
Take-profit target: $67.15 (+14.7% upside). Prior stop was $54.76. Stop-loss: $54.76.
Concentration risk — Product: licensing (93.0%); Concentration risk — Supplier: sole source suppliers; Sector modifier (Industrials): -0.7.
Dolby Laboratories trades at a P/E of 24.5 (forward 12.6). TrendMatrix value score: 6.1/10. Verdict: Sell.
10 analysts cover DLB with a consensus score of 4.1/5. Average price target: $79.
What does Dolby Laboratories do?Dolby Laboratories licenses audio and video technologies — including Dolby Atmos, Dolby Vision, and audio codecs — to...
Dolby Laboratories licenses audio and video technologies — including Dolby Atmos, Dolby Vision, and audio codecs — to approximately 1,000 device manufacturers, generating 93% of fiscal 2025 revenue from licensing and 7% from cinema hardware and services. Per-unit royalties from OEMs across broadcast, mobile, PC, and CE device markets drive the licensing model. The company held approximately 28,400 issued patents as of September 26, 2025.