What changed in this filing

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Item 1A. Risk Factors

2025-11-18 compared with 2024-11-19 · 110 added, 104 removed, 382 unchanged (36% of the section changed)

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Changing trends in the way that content is distributed and consumed may impact our existing business and future opportunities for growth.

One such trend is the shift by consumers in certain markets away from subscription-based cable and satellite television providers toward streaming services, commonly referred to as "cord-cutting." While cable and satellite television often require a STB, today consumers can also access streaming media through smart TVs or DMA devices.

As consumers trend toward canceling subscriptions to these traditional cable and satellite providers and turn to streaming media, we expect demand for STBs in certain regions to continue to decline.

If we are unable to derive additional revenue from the smart TV and DMA markets to make up for decreases in our STB-related revenue, our financial results may be negatively impacted.

One such trend has been the shift by consumers in certain markets away from subscription-based cable and satellite television providers toward streaming services, commonly referred to as "cord-cutting." While cable and satellite television often require a STB, consumers can also access streaming media through smart TVs or DMA devices.

As consumers have trended toward canceling subscriptions to these traditional cable and satellite providers in favor of streaming media, we have observed declines in demand for STBs in certain regions.

Other changes to the way content is distributed and consumed may impact our licensing and other businesses in a similar fashion, and we may not be able to anticipate and respond effectively to such future changes.

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However, the online and mobile media content services markets are also characterized by intense competition, evolving industry standards and business and distribution models, disruptive software and hardware technology developments, frequent product and service introductions and short life cycles, and price sensitivity on the part of consumers, all of which may result in downward pressure on pricing or the removal of our technologies by these providers and may result in decreased revenue from our mobile market.

Further, macroeconomic conditions such as inflation, geopolitical instability, global health risks, and other factors may adversely impact the ability of our partners to manufacture and distribute mobile devices and consumer demand for mobile devices.

Further, macroeconomic conditions such as inflation, trade barriers, geopolitical instability, global health risks, and other factors may adversely impact the ability of our partners to manufacture and distribute mobile devices and consumer demand for mobile devices.

Our revenue from the PC market is reliant on key partnerships and is vulnerable to macroeconomic risks .

Our revenue from the PC market depends on several factors, including underlying PC unit shipments, the extent to which our technologies are included on computers, including through operating systems and various subsystems, and the terms of any royalties or other payments we receive.

For example, beginning with PCs shipping with the 24H2 version of Windows 11, Microsoft is changing the way Dolby’s DD and DD+ decoders are provided to third party PC OEMs.

For such devices, Dolby has begun distributing those codecs directly to PC OEMs instead of through Microsoft’s Windows operating system.

For example, beginning with PCs shipping with the 24H2 version of Windows 11, Microsoft changed the way Dolby’s DD and DD+ decoders are provided to third party PC OEMs.

For such devices, Dolby now distributes those codecs directly to PC OEMs instead of through Microsoft’s Windows operating system.

To the extent that PC manufacturers do not incorporate our technologies in current and future products, our revenue could be impacted.

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The success of Dolby Cinema and cinema product sales are subject to a number of factors beyond our control, such as the production of films in Dolby formats and broader cinema industry conditions.

Revenue from Dolby Cinema

and cinema product sales is subject to our ability to develop and implement new technologies, the pace of construction or upgrade of screens, the financial stability of exhibitors, the advent of new or competing technologies, and the willingness of movie studios to produce films in our Dolby Atmos and Dolby Vision formats.

Revenue from Dolby Cinema and cinema product sales is subject to our ability to develop and implement new technologies, the pace of construction or upgrade of screens, the financial stability of exhibitors, the advent of new or competing technologies,

and the willingness of movie studios to produce films in our Dolby Atmos and Dolby Vision formats.

Although we have invested a substantial amount of time and resources developing Dolby Cinema, and expect to continue to invest and build partnerships in connection with the launch of Dolby Cinema locations, we may not continue to recognize a meaningful amount of revenue from these efforts in the near future.

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To the extent that we do not make progress in these areas or are faced with pricing pressures or competing technologies, our revenue may be adversely impacted.

Our revenue and associated demand for Dolby Cinema and cinema products are affected by cinema industry and macroeconomic conditions, which are subject to risks including consumer trends and box office performance generally, delays in cinematic releases, the seasonality of film releases and associated moviegoing attendance, and other events or conditions in the cinema industry.

As an example, the COVID-19 pandemic and the restrictions related to the pandemic resulted in reduced cinema attendance and revenue.

Additionally, the strikes by the Writers Guild of America and SAG-AFTRA in 2023 effectively halted the production, release and promotion of certain films for an extended period, resulting in decreased box office receipts, which directly impacted the revenue generated by Dolby Cinema theaters.

Such disruptions in the past have impacted, and potential similar disruptions in the future could potentially impact exhibitors’ willingness and ability to invest in Dolby cinema products.

Our revenue and associated demand for Dolby Cinema and cinema products are affected by cinema industry and macroeconomic conditions, which are subject to risks including consumer trends and box office performance in general, delays in cinematic releases, the seasonality of film releases and associated moviegoing attendance, potential tariffs and other trade barriers, and other events or conditions in the cinema industry.

For example, restrictions related to the COVID-19 pandemic and certain entertainment industry labor strikes resulted in reduced cinema attendance and box office receipts in the past.

Such disruptions impacted, and potential similar disruptions in the future could potentially impact, revenue generated by Dolby Cinema theaters and exhibitors’ willingness and ability to invest in Dolby Cinema and cinema products.

Also, a portion of our opportunity lies in the China market, which is subject to unique economic and geopolitical risks.

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To the extent that such cinema industry and macroeconomic challenges constrain the growth of our Dolby Cinema and cinema products offerings, our revenue may be adversely impacted.

Customers and Distributors

Our licensing business depends on the incorporation of our technologies into products and the sales of such products, which are, in large part, not within our control .

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Further, demand levels may result in shortages of semiconductor components and other key materials that may adversely impact the ability of our implementation and system licensees and other customers to meet product demand in a timely fashion.

Consumer spending weakness may impact our licensees and licensing revenues generally .

Weakness in general economic conditions due to inflation, elevated interest rates, lower consumer confidence, a potential

recession, pandemic or other adverse economic conditions, may suppress consumer demand in our markets and consumers going to the movies.

Many of the products in which our technologies are incorporated are discretionary goods, such as PCs, TVs, STBs, video game consoles, AV Receivers, mobile devices, in-car entertainment systems, and home-theater systems, which makes revenue generated by such technologies vulnerable to weakness in consumer spending.

Consumer spending weakness may impact our licensees and licensing revenue generally .

Weakness in general economic conditions due to inflation, elevated interest rates, lower consumer confidence, tariffs and non-tariff trade barriers, a potential recession, pandemic or other adverse economic conditions, may suppress consumer demand in our markets and consumers going to the movies.

Many of the products in which our technologies are incorporated are discretionary goods, such as PCs, TVs, STBs, video game consoles, AV Receivers, mobile devices, in-car

entertainment systems, and home-theater systems, which makes revenue generated by such technologies vulnerable to weakness in consumer spending.

Prolonged weakness in consumer spending may also lead to licensees and other customers becoming delinquent on their obligations to us or being unable to pay, resulting in a higher level of write-offs.

Weakness in consumer spending may also increase underreporting and non-reporting of royalty-bearing revenue by our licensees as well as increase the unauthorized use of our technologies.

Our reliance on distributors may impact sales of certain products and present compliance risks.

We rely significantly on a global network of independent, regional distributors to market and distribute our cinema products.

Our distributor arrangements are non-exclusive and our distributors are not obligated to buy our products and can represent competing products.

Thus, they may be unwilling or unable to dedicate the resources necessary to promote our portfolio of products.

Our distributors could retain product channel inventory levels that exceed future anticipated sales, which could affect our future sales to those distributors.

In addition, failure of our distributors to adhere to our policies designed to promote compliance with global anticorruption laws, export controls, and local laws, could subject us to criminal or civil penalties and stockholder litigation.

Marketing and Branding

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If our ESG practices do not meet evolving investor or other stakeholder expectations and societal and regulatory standards, or if we are unable to make progress on or achieve our goals and objectives in this area, then our reputation, our ability to attract or retain employees, and our attractiveness as an investment or business partner could be negatively impacted, which could adversely affect our operating results.

Industry Standards

Certain parts of our business are dependent on the inclusion of our technologies in industry standards, the adoption and development of which are not fully within our control.

Technology Standards

Certain parts of our business are dependent on the inclusion of our technologies in technology standards, the adoption and development of which are not fully within our control.

Standards-setting organizations establish technology standards for use in a wide range of products and solutions.

The entertainment industry in particular has historically depended upon industry standards to ensure compatibility and interoperability across delivery platforms and a wide variety of consumer entertainment products.

The entertainment industry in particular has historically depended upon technology standards to ensure compatibility and interoperability across delivery platforms and a wide variety of consumer entertainment products.

We make significant efforts to design our products and technologies to address capability, quality, and cost considerations so that they either meet or, more importantly, are adopted as industry standards across the broad range of entertainment industry markets in which we participate, as well as the markets in which we plan to compete in the future.

We are also active in standards development where many contributing members work together to come up with next-generation technology standards in media, entertainment, and communications technologies.

Nonetheless, it can be difficult to have our technologies and products adopted as industry standards.

Nonetheless, it can be difficult to have our technologies and products adopted as technology standards.

To do so, we must convince a broad spectrum of standards-setting organizations throughout the world, as well as our major customers and licensees who are members of such organizations, to adopt them as such.

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Standards may also change in ways that are unfavorable to Dolby.

The market for broadcast technologies in particular has traditionally been heavily based on industry standards, in some cases mandated by governments choosing from among alternative standards, and we expect this to continue to be the case in the future.

The market for broadcast technologies in particular has traditionally been heavily based on technology standards, in some cases mandated by governments choosing from among alternative standards.

The continued advancement of OTT media delivery and consumption is altering the landscape for broadcast standards.

This trend is reducing the importance of the inclusion of our technology in certain

broadcast standards while increasing the importance of inclusion within internet and mobile industry standards.

The importance of broadcast standards in the entertainment technology ecosystem has been gradually diminishing over the recent years.

This trend is reducing the importance of the inclusion of our technology in certain broadcast standards while increasing the importance of inclusion within internet and mobile technology standards.

We cannot predict the extent to which this trend may impact our revenue.

Participants may choose alternative technologies within standards .

Even when a standards-setting organization incorporates our technologies in an industry standard for a particular market or geographic region, our technologies may not be the sole technologies adopted for that market.

Even when a standards-setting organization incorporates our technologies in an technology standard for a particular market or geographic region, our technologies may not be the sole technologies adopted for that market.

Furthermore, different standards may be adopted within a single market or region, and across different markets and regions.

Our operating results depend upon participants in that market choosing to adopt our technologies instead of competitive technologies that also may be acceptable under such standard.

For example, the continued growth of our revenue from the broadcast market will depend upon both the continued global adoption of DTV generally, including in emerging markets, and the choice to use our technologies where it is one of several accepted industry standards.

technologies where it is one of several accepted industry standards.

Being part of a standard may limit our licensing practices .

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Additionally, where our technologies are incorporated into a standard, our licensing practices may become subject to additional regulatory requirements.

For example, the European Union (EU) legislature is considering regulation that would impose a number of requirements on standard essential patent (SEP) licensing practices in the EU.

Such regulation could, if it comes into effect, impose additional costs and disclosure requirements on our SEP licensing business and potentially reduce associated revenue.

Royalty Reporting

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Upon receipt of actual reporting of sales-based royalties, we record a favorable or unfavorable adjustment based on the difference, if any, between estimated and actual sales.

Our sales estimates may be based on reports or studies from third parties may turn out to be inaccurate or incomplete, and that risk may increase when macroeconomic conditions are highly dynamic, which could result in significant variation in the amount of revenue we recognize in a quarter.

Additionally, our results of operations could be impacted to the extent that we are required to accelerate recognition of revenue under certain arrangements, potentially causing the amount of revenue we recognize to vary materially from quarter to quarter.

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However, it is inherently difficult to independently determine whether our licensees are reporting shipments accurately, particularly with respect to software incorporating our technologies because unauthorized copies of such software can be made relatively easily.

A third party may disagree with our interpretation of the terms of a license agreement or, as a result of an audit, a third party could challenge the accuracy of our calculation.

We are regularly involved in discussions with third party technology licensees regarding license terms.

A licensee may disagree with our interpretation of the terms of a license agreement or, as a result of an audit, a licensee could challenge the accuracy of our calculation.

We are regularly involved in discussions with licensees regarding license terms.

Most of our license agreements permit us to audit our licensees’ records, and we routinely exercise these rights, typically by using an independent third party auditor.

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In the past, some licensees have understated or failed to report the number of products incorporating our technologies that they shipped, and we have not been able to collect and recognize revenue to which we were entitled.

We expect that we will continue to experience understatement and non-reporting of royalties by our

We expect that we will continue to experience understatement and non-reporting of royalties by our licensees.

We have been able to obtain certain recovery payments from licensees (either in the form of back payments or settlements), and such recoveries have become a recurring element of our business;

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For instance, to broaden adoption of Dolby Vision and Dolby Atmos, we will need to continue to expand the array of products and consumer devices that incorporate Dolby Atmos and Dolby Vision, expand the pipeline of Dolby Atmos and Dolby Vision content available from content creators, and encourage consumer adoption in the face of competing products and technologies.

Similarly, the success of Dolby Cinema is dependent on our ability to partner with movie theater exhibitors to launch new Dolby Cinema sites and to deploy new sites in accordance with plans, and on the continued release and box-office success of new films in the Dolby Vision and Dolby Atmos formats released through Dolby Cinemas.

Further, the commercial success of products incorporating Dolby formats, content released in Dolby formats,

and Dolby Cinemas generally, depends upon a number of factors outside of our control, including, but not limited to, consumer preferences, critical reception, timing of release, marketing efforts of third parties, and general market conditions.

Similarly, the success of Dolby Cinema and cinema products is dependent on our ability to partner with movie theater exhibitors to launch new Dolby Cinema locations and screens using our cinema products and to deploy new sites in accordance with plans, and on the continued release and box-office success of new films in the Dolby Vision and Dolby Atmos formats.

Further, the commercial success of products incorporating Dolby formats, content released in Dolby formats, and Dolby Cinemas generally, depends upon a number of factors outside of our control, including, but not limited to, consumer preferences, critical reception, timing of release, marketing efforts of third parties, and general market conditions.

Moreover, release and distribution of such products and content can be subject to delays in production or changes in release schedule, which can negatively impact the quantity, timing and quality of such products and content released in Dolby formats and available at Dolby Cinema theaters.

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The efforts we have taken to protect our proprietary rights may not be sufficient or effective.

We also seek to maintain select IP as trade secrets, and third parties or our employees could intentionally or accidentally compromise the IP that we maintain as trade secrets.

We also seek to maintain

select IP as trade secrets, and third parties or our employees could intentionally or accidentally compromise the IP that we maintain as trade secrets.

In addition, protecting our IP rights is costly and time consuming.

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• Possibility that an issued patent may later be found to be invalid or unenforceable;

• Patents eventually expire.

Our revenue could decline if we are unable to maintain patent coverage for our technologies .

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In general, our agreements with our licensees require them to pay us a full royalty with respect to a particular technology only until there are no patents or, in some cases, no patent applications covering that technology in countries where applicable products are made and sold.

As of September 27, 2024, we had approximately 27,400 issued patents in addition to approximately 5,900 pending patent applications in more than 100 jurisdictions throughout the world, which includes patents and patent applications acquired in connection with our acquisition of GE Licensing and THEO, described in more detail in Note 15 " Business Combinations " to our consolidated financial statements.

Our currently issued patents expire at various times through December 2047.

As of September 26, 2025, we had approximately 28,400 issued patents in addition to approximately 6,100 pending patent applications in more than 200 jurisdictions throughout the world.

Our currently issued patents expire at various times ranging from 2025 through 2047.

If we are unable to refresh our technology with new patented inventions or expand our patent portfolio, our revenue could decline.

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The continued success of these risk mitigation strategies is not guaranteed, including the risk that such technologies will not achieve widespread adoption or be licensed at a rate sufficient to replace licensing revenue from technologies covered by expiring patents.

In the case of our patent coverage related to DD, some of our relevant patents have expired, but others continue to apply.

DD is our solution that includes technology necessary to implement AC-3 as it has been updated over time.

We have continued to innovate and develop IP to support the standard and its implementation.

Our customers use our DD implementation for quality, reliability, and performance, even in locations where we have not had applicable patent coverage.

While in the past, we derived a significant portion of our licensing revenue from our DD technologies, this is no longer the case as revenue attributed to DD technologies has declined and is expected to continue to decline.

Many of our partners have adopted newer generations of our offerings such as DD+, and the range of products incorporating DD solutions is now limited to DVD players (but not Blu-ray players) and some TVs, STBs and soundbars.

To continue to be successful in our audio licensing business, we must keep transitioning our DD licensees to our newer technologies, including our DD+ and Dolby AC-4 technologies.

In the case of our patent coverage related to DD and DD+ audio codec technologies, some of our relevant patents have expired and will expire in the coming years, but others will continue to apply.

We have continued to innovate and develop IP to support these standardized technologies and their various implementations, including generating patents associated with different or new features of the technologies and obtaining patents that generally expire later than those incorporated into the original standards.

Our customers use our DD and DD+ implementation for quality, reliability, and performance and to take advantage of other elements of these offerings such as Dolby branding, even in locations where we have not had or no longer have applicable patent coverage.

Nevertheless, revenue attributed to DD and DD+ technologies has declined and is expected to continue to decline due, in part, to expiration of relevant patents.

Many of our partners have adopted newer generations of our offerings such as Dolby AC-4 technologies, the associated patents of which generally expire later than those associated with DD and DD+.

We will continue to work to transition our DD and DD+ licensees to our newer technologies, but the success of such efforts is not guaranteed.

Some of our patents incorporated into the AAC audio coding standard and the AVC digital video coding standard, from which we derive a significant portion of our licensing revenue, have expired and others will expire over the next several years.

While there are alternative versions of these standards that offer different features and that incorporate patents that have later expirations, licensees may see less value in those alternative versions, resulting in a decrease in royalty revenue.

A decrease in royalty revenue may also result in decreased revenue from patent pool administration fees.

Our patents are incorporated into newer coding standards that represent successive generations

of technology, such as, in the case of AAC, Extended HE-AAC and, in the case of AVC, HEVC whose patents generally expire later than the AAC and AVC patents and to which many of the AAC and AVC licensees have, are in the process of, or may in the future transition.

However it is not certain that all or most licensees will transition to such newer technologies.

Unauthorized use of our intellectual property has occurred and will likely continue to occur .

We have often experienced, and expect to continue to experience, problems with non-licensee OEMs and software vendors, particularly in certain emerging economies, incorporating our technologies and trademarks into their products without our authorization and without paying us any licensing fees.

Unauthorized IP use occurs in the context of both branded products and technology offered through open standards.

Manufacturers of ICs containing our technologies occasionally sell these ICs to third parties who are not our system licensees.

These sales, and the failure of such manufacturers to report the sales, facilitate the unauthorized use of our IP.

As emerging economies transition from analog to digital content, such as the transition from analog to digital broadcast, we expect to experience an increase in problems with this form of piracy.

As emerging economies have transitioned from analog to digital content, such as the transition from analog to digital broadcast, we have observed an increase in problems with this form of piracy.

Our business may be negatively impacted by intellectual property litigation .

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Changes to the patent and intellectual property laws and regulations in the U.S.

and abroad, including the regulation regarding SEP licensing in the EU referenced above, may limit our ability to obtain, license, and enforce our rights.

and abroad may limit our ability to obtain, license, and enforce our rights.

Additionally, court and administrative rulings may interpret existing patent laws and regulations in ways that hurt our ability to obtain, license, and enforce our patents.

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Also, because of limitations in the legal systems in many countries, our ability to obtain and enforce patents in many countries is uncertain, and we must strengthen and develop relationships with entertainment industry participants worldwide to increase our ability to enforce our IP and contractual rights without relying solely on the legal systems in the countries in which we operate.

Reliance on key suppliers presents certain risks to our business, many of which are beyond our control .

Production processes for our products and reliance on key suppliers present certain risks to our business, many of which are beyond our control .

We rely on contract manufacturers to manufacture our products and such reliance involves risks, including limited control over timely delivery and quality of such products.

We may be unable to quickly adapt manufacturing capacity to rapidly changing market conditions, such as fluctuations in customer demand.

Supply chain disruptions, production interruptions, and shortages of manufacturing capacity could each lead to an

inability to manufacture and deliver our products on a timely basis, which could negatively impact our operating results and damage our customer relationships.

Our reliance on suppliers for some of the key materials and components we use in manufacturing our products involves risks, including limited control over the price, timely delivery, and quality of such components, as well as delays caused by military conflicts, including those between Russia and Ukraine and in the Middle East, and other potential interruptions to the supply chain.

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In addition, our suppliers may not be able to meet our production demands as to volume, quality, or timeliness.

Avoiding the potential inclusion of “conflict minerals” in the materials used in our products could also affect the sourcing, availability and pricing of such materials as well as the companies we use to manufacture our products.

Due to the bespoke nature of some of the components and products we purchase and relatively low quantities needed, sourcing multiple suppliers for every item we purchase is not practicable.

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Ensuring the quality of our products and the products in which our technology is incorporated is inherently difficult, and product quality failures can be costly .

Our products, and products that incorporate our technologies, are complex and sometimes contain software or hardware errors that are not detected during testing, particularly when first introduced or when new versions are released.

In addition, we have limited control over manufacturing performed by contract manufacturers, which could result in quality problems.

While we conduct security testing prior to releasing new products or new versions of existing products, there are sometimes errors or vulnerabilities that are not detected during development or testing.

We have limited control over manufacturing performed by contract manufacturers, which could result in quality problems.

Furthermore, our products and technologies are sometimes combined with or incorporated into products from other vendors, sometimes making it difficult to identify the source of a problem or, in certain instances, making the quality of our implementation dependent in part upon the quality of such other vendors' products.

Any negative publicity or impact relating to these product problems could affect the perception of our brand and market acceptance of our products or technologies.

These errors could result in a loss of or delay in market acceptance of our products or cause delays in delivering them and meeting customer demands, any of which could reduce our revenue and raise significant customer relations issues.

In addition, if our products or technologies contain errors, we could be required to replace or reengineer them or rely upon parties who have incorporated our technologies into their products to implement updates to address such issues, which could cause delays or increase our costs.

Moreover, if any such errors cause unintended consequences, we could incur substantial costs in defending and settling product liability claims.

While we have processes to remediate errors and vulnerabilities, we cannot guarantee that we will detect all issues or develop successful patches.

If our products or technologies contain errors, we could be required to replace or reengineer them and, as with security vulnerabilities, we may rely upon parties who have incorporated our technologies into their products to implement updates to address such issues, which could leave any such errors or vulnerabilities unresolved.

As an example of these types of risks, in October 2025, a team of security researchers announced a vulnerability related to a specific Dolby software module.

We have developed a corrective software patch and made the patch, as well as other assistance, available to potentially impacted partners.

While many of our partners have deployed the patch across their devices, the application of the patch across all affected devices will require the effort of our partners and, in some cases, the end users and other third parties, which we cannot guarantee.

While there are technical impediments to exploiting unpatched devices, we cannot guarantee that malicious actors will not exploit unpatched vulnerabilities and damage or gain unauthorized access to affected products.

Negative publicity or impact related to errors or vulnerabilities could affect the perception of our brand and market acceptance of our products or technologies.

Moreover, if any errors or vulnerabilities cause unintended consequences, we could incur substantial costs in investigating and remediating those consequences, including defending and settling product liability claims.

Although we generally attempt to contractually limit our liability, if these contract provisions are not enforced, or are unenforceable for any reason, or if liabilities arise that are not effectively limited, we could incur substantial costs in defending and settling product liability claims.

Production processes for our products are subject to interruption, delay, and other risks .

Production difficulties or inefficiencies can interrupt production, resulting in our inability to deliver products on time or in a cost effective manner, which could harm our competitive position.

We rely on contract manufacturers to manufacture our products and such reliance involves risks, including limited control over timely delivery and quality of such products.

If production of our products is interrupted, we may not be able to manufacture products on a timely basis.

A shortage of manufacturing capacity for our products could negatively impact our operating results and damage our customer relationships.

We may be unable to quickly adapt manufacturing capacity to rapidly changing market conditions, such as fluctuations in customer demand.

Supply chain disruptions and extended lead times for semiconductor and electrical components may limit the availability of products and result in difficulty meeting demand.

We face threats to the confidentiality, integrity, and availability of our information systems, which could result in the misappropriation of sensitive information, disruption of our business, reputational damage, legal exposure, and financial losses.

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We expect to face increased royalty pricing pressure for our technologies as we seek to increase the adoption of our technologies in online content and portable devices, such as tablets and smartphones.

Such pricing pressures may be exacerbated by elevated rates of inflation, which may cause device manufacturers to take additional steps to limit costs.

Such pricing pressures may be exacerbated by elevated rates of inflation, tariffs and other trade barriers, which may cause device manufacturers to take additional steps to limit costs.

Retail prices for consumer entertainment products that include our audio technologies, such as home theater systems, have decreased significantly, and we expect prices to decrease for the foreseeable future.

In response, OEMs have sought to reduce their product costs, which can result in additional downward pressure on the licensing fees we charge.

Further, Dolby.io faces pricing pressure from other platforms offering similar solutions that may be able to offer competing services at lower prices.

Further, Dolby OptiView faces pricing pressure from other platforms offering similar solutions that may be able to offer competing services at lower prices.

We face competitive risks in situations where our customers are also current or potential competitors .

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• Device manufacturers;

• Standards-setting organizations and other participants in the development of industry standards.

Industry relationships have historically played an important role in the markets that we serve, particularly in the entertainment market.

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Industry relationships also play an important role in other markets we serve;

for instance, our relationships with companies building real-time digital experiences support the adoption of Dolby.io solutions.

If we fail to maintain and strengthen our industry relationships, industry participants may be less likely to purchase and use our technologies, products, and services, or create content incorporating our technologies.

for instance, our relationships with companies building real-time digital experiences support the adoption of Dolby OptiView solutions.

If we fail to maintain and strengthen our industry relationships,

industry participants may be less likely to purchase and use our technologies, products, and services, create content incorporating our technologies, or develop standards that incorporate our technologies.

Our M&A activity is subject to certain risks, including risks associated with integrating acquired businesses .

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Although we cannot predict whether or not we will complete any such acquisitions or other transactions in the future, any of these transactions could be significant in relation to our market capitalization, financial condition, or results of operations.

The process of integrating an acquired company, business, or technology may create unforeseen difficulties and expenditures.

Foreign acquisitions involve unique risks in addition to those mentioned above, including those related to integration of operations across different geographies, cultures, and languages;

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Also, the anticipated benefits of our acquisitions may not materialize.

We face various risks in integrating acquired businesses, including:

The process of integrating an acquired company, business, or technology into our organization may create challenges to our business, including:

• Diversion of management time and focus from operating our business to acquisition integration challenges;

• Cultural and logistical challenges associated with integrating employees from acquired businesses into our organization;

• Cultural and logistical challenges associated with integrating employees from acquired businesses into our organization and integrating acquired businesses' accounting, human resources, and other administrative systems with existing systems;

• Retaining employees, suppliers and customers from businesses we acquire;

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• Unanticipated or unknown liabilities relating to acquired businesses.

• The need to integrate acquired businesses’ accounting, management information, manufacturing, human resources, and other administrative systems to permit effective management.

LEGAL AND REGULATORY COMPLIANCE

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We are subject to a number of risks related to conducting business internationally, including:

and foreign government trade restrictions or sanctions, including those which may impose restrictions on the importation or exportation of products, equipment, materials, software, technologies, services, on technology transfers, or on the receipt or collection of payments and distribution of royalties, and any political or economic responses or counter-responses to such restrictions or sanctions, including any such restrictions, sanctions, responses, or counter-responses related to global military conflicts or changes in US export controls related to China and other countries;

• Changes in trade relationships, including new tariffs, trade protection measures, import or export licensing requirements, trade embargoes and other trade barriers imposed by the U.S.

or by other countries;

and foreign government trade restrictions or sanctions, including those which may impose restrictions on the importation or exportation of products, equipment, materials, software, technologies, services, on technology transfers, or on the receipt or collection of payments and distribution of royalties, and any political or economic responses or counter-responses to such restrictions or sanctions, including any such restrictions, sanctions, responses, or counter-responses related to global military conflicts, a trade war or changes in US export controls related to China and other countries;

• Changes in global trade or trade relationships, including new and retaliatory tariffs, trade protection measures, import or export licensing requirements, trade agreements, trade embargoes and other trade barriers imposed by the U.S., China, or by other countries;

• Compliance with applicable international laws and regulations, including antitrust and other competition laws and laws and regulations that relate to environmental, social, and governance matters, that may change unexpectedly, differ, or conflict with laws in other countries where we conduct business, or are otherwise not harmonized with one another;

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From time to time, we are the subject of requests for information, market conduct examinations, inquiries or investigations by industry groups and/or regulatory agencies in these jurisdictions.

For instance, the Korean Fair Trade Commission requested information relating to our business practices in South Korea on various occasions, and initially made findings regarding the audit of a single customer.

In July 2023, that determination was overturned by the Korean Civil court and thus the matter was fully resolved in Dolby’s favor.

In the event that we are involved in significant disputes or are the subject of a formal action by a regulatory agency, our results could be negatively impacted and we could be exposed to costly and time-consuming legal proceedings.

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Although we implement policies and procedures designed to ensure compliance with the FCPA and U.S.

export controls, such measures can not guarantee that all of our employees, distributors, dealers, and agents will not take actions in violation of our policies or these regulations.

export controls, such measures can not guarantee that all of our employees, distributors, dealers, and agents will not take actions in violation of our policies or these regulations, which could subject us to criminal or civil penalties as well as potential stockholder litigation.

Environmental laws and regulations may pose additional costs on and otherwise impact our products and operations .

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We could incur costs, fines, and civil or criminal sanctions, third party property damage or personal injury claims, or could be required to incur substantial investigation or remediation costs, if we were to violate or become liable under environmental laws.

We are subject to regulations relating to “conflict minerals” and compliance with, or failure to comply with, such regulations may be costly .

SEC rules require the disclosure of the use of tantalum, tin, tungsten, and gold (commonly referred to as "conflict minerals") that are sourced from the Democratic Republic of the Congo and surrounding countries.

Certain of those minerals are used in the manufacturing process of electrical components that our products utilize.

The potential inclusion of conflict minerals in the materials used in our products could affect the sourcing,

availability and pricing of such materials as well as the companies we use to manufacture our products.

In circumstances where sources of conflict minerals from the Democratic Republic of the Congo or surrounding countries are not validated as conflict free, we may take actions to change materials, designs or manufacturers to reduce the possibility that our contracts to manufacture products that contain conflict minerals finance or benefit local armed groups in the region.

As there may be only a limited number of suppliers that can certify that they are offering “conflict free” conflict minerals, we cannot be sure that our component suppliers will be able to obtain necessary conflict minerals from such suppliers in sufficient quantities or at competitive prices.

These actions could also add engineering and other costs in connection with the manufacturing of our products.

If conflict minerals used in our products are determined to finance armed conflict, even if we are not aware of such status, disclosure of such status could affect public and investor perception of Dolby and our products.

We may not be able to sufficiently verify the origins for the minerals used in our components.

Our reputation may suffer if we determine that our components contain conflict minerals that are not determined to be conflict free or if we are unable to sufficiently verify the origins for all conflict minerals used in our components.

In addition, some customers may require that all of our products are certified to be conflict free and if we cannot satisfy these customers, they may choose a competitor's products.

We are subject to complex and changing tax laws which may impact our financial results .

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Changes in U.S.

tax law, including the Tax Cuts and Jobs Act ("Tax Act") and the Inflation Reduction Act, may affect our business.

tax law may affect our business.

For example, in July 2025 budget reconciliation bill H.R.

1, referred to as the One Big Beautiful Bill Act (the “OBBBA”), was signed into law.

The OBBBA contains several changes to corporate taxation rules which may affect our business.

These provisions, their interpretations, and other proposed changes to law could further impact our corporate trading structure and adversely affect our tax rate and cash flow in future years.

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The OECD has introduced a framework to implement a 15% global minimum corporate tax, referred to as Pillar 2 or the minimum tax directive.

The minimum tax directive has been adopted by the EU for implementation by its Member States into national legislation and may be adopted by other jurisdictions, including the U.S.

The minimum tax directive has been adopted by the EU for implementation by its Member States into national legislation, several foreign jurisdictions, and may be adopted by other jurisdictions.

Further, the OECD, European Commission, EU Member States and other individual countries have made and could make additional competing jurisdictional claims over the taxes owed on earnings of multinational companies in their respective countries or regions.

To the extent these actions take place in the countries that we operate, it is possible that these law changes and efforts may increase uncertainty and have an adverse impact on our effective tax rates or operations.

Recently, the G7 and the U.S.

Treasury Department announced an agreement that impacts U.S.-parented group companies whereby the Pillar 2 rules and the U.S.

international tax regime will operate in parallel.

To the extent these developments impact actions by tax jurisdictions in the countries that we operate, it is possible that these and future law changes and efforts may increase uncertainty and have an adverse impact on our effective tax rates or operations.

We are subject to the periodic examination of our income tax returns by tax authorities.

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STOCK-RELATED ISSUES

The Dolby family has control over stockholder decisions as a result of the control of a majority of the voting

power of our outstanding common stock by them and their affiliates .

At September 27, 2024, the Dolby family and their affiliates owned 314,968 shares of our Class A common stock and 35,597,733 shares of our Class B common stock.

The Dolby family has control over stockholder decisions as a result of the control of a majority of the voting power of our outstanding common stock by them and their affiliates .

As of September 26, 2025, the Dolby family and their affiliates owned 246,295 shares of our Class A common stock and 34,587,733 shares of our Class B common stock.

As of September 26, 2025, the Dolby family and their affiliates had voting power of 99.8% of our outstanding Class B common stock, which combined with their shares of our Class A common stock, represented 85.0% of the combined voting power of our outstanding Class A and Class B common stock.

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There are risks associated with our dividend program .

We cannot provide assurance that we will continue to increase dividend payments and/or pay dividends.

We are not obligated to pay dividends on our Class A and Class B common stock.

In October 2014, we announced a quarterly cash dividend program for our stockholders that was initiated by our Board of Directors.

Although we anticipate paying regular quarterly dividends for the foreseeable future, dividend declarations and the establishment of future record and payment dates are subject to the Board of Directors’ continuing determination that the dividend policy is in the best interests of our stockholders.

Although we anticipate paying regular quarterly dividends for the foreseeable future, we are not obligated to, and cannot provide assurance that we will, continue to pay dividends.

Dividend declarations are subject to the Board of Directors’ continuing determination that the dividend policy is in the best interests of our stockholders.

The dividend policy may be changed or canceled at the discretion of the Board of Directors at any time.

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GENERAL RISK FACTORS

Macroeconomic conditions, including inflation, elevated interest rates, supply chain constraints and the lasting effects of the COVID-19 pandemic have impacted and may continue to impact the markets we serve and our business and results of operations.

Our revenue and operations and the markets we serve have been, and may continue to be, impacted by macroeconomic conditions, including but not limited to, inflation, elevated interest rates, the lasting effects of the COVID-19 pandemic, supply chain constraints, increased shipping costs, international conflicts, reduced discretionary consumer spending, and reduced new product investment by our customers caused by elevated interest rates and lower demand.

Macroeconomic conditions, including inflation, elevated interest rates, and supply chain constraints have impacted and may continue to impact the markets we serve and our business and results of operations.

Our revenue and operations and the markets we serve have been, and may continue to be, impacted by macroeconomic conditions, including but not limited to, inflation, elevated interest rates, supply chain constraints, increased shipping costs, tariffs and changes in international trade relations, international conflicts, reduced discretionary consumer spending, and reduced new product investment by our customers caused by elevated interest rates and lower demand.

The current macroeconomic environment has negatively impacted, and may continue to negatively impact, many of our licensees and that directly impacts, and may continue to impact, our financial results.

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The future implications of these macroeconomic conditions on our business, the markets we serve, results of operations and overall financial position remain uncertain.

Adverse changes to tariffs, trade agreements, and trade policies may have a negative effect on our business and results of operations.

The United States and other countries in our supply chain or in which we have sales have imposed and may impose additional tariffs and other trade regulations, or may adversely adjust prevailing tariff levels and other trade restrictions.

We rely on contract manufacturers and component suppliers, some of which are located outside of the United States, and we export our products to and license our technology in foreign countries.

As such, newly implemented tariffs and potential future tariffs or other trade barriers could, directly or indirectly, increase the cost or time required to produce or deliver our products and may increase the costs associated with licensing our technology.

Our results may also be impacted indirectly by the imposition of tariffs and other trade barriers on our customers and licensees.

If the cost to manufacture products that incorporate our technology, such as consumer electronics or cars, is increased as a result of tariffs, it may exert general pricing pressure which could lead manufacturers to discontinue including our technology in their products or to seek price reductions.

If the costs or lead

times associated with exporting licensees’ products or the components thereof result in higher prices or longer lead times for end consumers, sales of those products may decrease and thus royalty payments to us based on unit shipments may decrease.

More generally, the imposition of tariffs and the outbreak of a trade war may lead to general negative economic effects, such as decreased consumer demand, recession or the elevated risk of recession, or higher inflationary pressures, which could adversely impact our business and results of operations.

Our results may be impacted by fluctuations in foreign currency exchange rates .

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Additional risks related to fluctuations in foreign currency exchange rates are described in the Foreign Currency Exchange Risk section of Part II, Item 7A " Quantitative and Qualitative Disclosures About Market Risk."

Maintaining a credit facility and future debt obligations could adversely affect our business and financial condition.

We maintain a revolving credit facility (the “Credit Facility”) with Bank of America, N.A.

which is currently undrawn.

The Credit Facility provides us with an additional source of capital and liquidity, but maintaining a debt facility inevitably presents certain risks.

We are subject to certain covenants and other obligations under the Credit Facility, such as maintaining a required gross leverage ratio, avoiding certain liens and paying commitment fees.

Our failure to comply with these covenants could result in the declaration of an event of default and cause us to be unable to borrow under the Credit Facility or result in the acceleration of the maturity of any indebtedness thereunder.

In the event we draw on the Credit Facility, our debt obligations could adversely impact us by, for example, requiring us to use a large portion of our cash flow to service the debt, which would reduce the amount of cash flow available to fund working capital, capital expenditures, and other business activities.

Borrowing under the Credit Facility would also increase our exposure to interest rate risk from variable rate indebtedness.

Business interruptions by natural disasters and other events beyond our control could adversely impact our business .

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors