Dolby Boosts Licensing Deals in Auto, TV, and PC Markets

LAS VEGAS — Dolby Laboratories (DLB), a leader in audio and video technology, showcased its growing presence in new markets during the CES 2024 tech trade show. Wall Street analyst Ralph Schackart from William Blair expressed positive views on Dolby’s performance, reaffirming an outperform rating on the company’s stock.

Dolby stock saw a slight increase, closing at 85.75 on the stock market.

At CES 2024, Dolby emphasized the increasing adoption of its Dolby Atmos and Dolby Vision technologies across diverse markets.

Dolby Atmos audio technology, for example, has gained traction among automakers.

During the show, Dolby unveiled a collaboration with Mercedes-Benz (MBGAF), Amazon.com (AMZN), and Amazon’s Audible, enabling Mercedes-Benz customers to experience Dolby Atmos audio for content from Audible and Amazon Music within their vehicles.

Over 10 global automobile manufacturers have either started shipping vehicles equipped with Dolby Atmos or have plans to integrate Dolby Atmos capability in their vehicles.

While Dolby Atmos is currently prevalent in luxury cars, there are expectations for it to expand to more affordable vehicles in the future, noted Schackart.

“Incremental licensing agreements align with Dolby’s long-term growth strategy,” mentioned Schackart in a client note. “In the near term, we believe the auto market has the most incremental leverage to Dolby’s revenues given the higher revenue per vehicle, compared to other devices such as mobile phones, PCs, etc.”

TV manufacturers are also increasingly adopting Dolby Atmos sound technology.

Hisense, a Chinese TV manufacturer, announced at CES 2024 that it would support Dolby Atmos FlexConnect, allowing users to easily pair wireless speakers with their TV’s sound system. TCL, a rival, had previously announced plans to integrate FlexConnect into new TV models.

MediaTex revealed its integration of FlexConnect into its Pentonic smart TV platform.

TCL, another Chinese company, announced at CES 2024 that its high-definition televisions and soundbars would utilize Dolby Atmos audio technology.

LG Electronics from South Korea announced at the show that its OLED displays would feature Dolby Vision Filmmaker Mode for enhanced cinematic visuals.

Dolby Vision Expands to PC Gaming
Dolby Vision is also extending its reach into PC gaming monitors. Asus and Dell’s (DELL) Alienware unit announced new gaming PC monitors that support the Dolby Vision experience. Dolby Vision enhances visuals with more vivid colors, realistic images, and finer details.

Dell further announced at CES 2024 that its latest XPS laptops would include Dolby Vision and Dolby Atmos.

Samsung’s Harman unit showcased Dolby audio innovations, including the latest in home theater surround sound, at CES 2024. Harman, known for brands like JBL and Infinity, partners with Dolby due to the prevalence of content tuned to Dolby formats such as Dolby Atmos, according to Xin Zhao, director of platform planning for Harman. Harman innovates on top of Dolby source content with its hardware.

According to IBD MarketSmith charts, Dolby stock has been in a consolidation period for 26 weeks, with a buy point of 91.02.