XML 26 R16.htm IDEA: XBRL DOCUMENT
v3.23.1

Leases | 6 Months Ended
--- | ---
Mar. 31, 2023
Leases [Abstract] |
Leases | Leases As Lessee As a lessee, we enter into contracts to access and utilize office space, including those payable to our principal stockholder and portions attributable to the noncontrolling interests in our consolidated subsidiaries. The following table presents the maturity analysis of lease liabilities (in thousands):
| March 31, 2023 |  |
| Operating Leases |  |
Remainder of Fiscal 2023 | $ | 7,240 |  |  |
Fiscal 2024 | 13,622 |  |  |
Fiscal 2025 | 10,138 |  |  |
Fiscal 2026 | 6,314 |  |  |
Fiscal 2027 | 3,993 |  |  |
Thereafter | 11,505 |  |  |
Total undiscounted lease payments | 52,812 |  |  |
Less: imputed interest | (4,944) |  |  |
Total lease liabilities | $ | 47,868 |  |  |
As Lessor As a lessor, we lease our Dolby Cinema product solution to exhibitors. The terms of these leases are typically 10 years. Lease components consist of fixed payments and/or variable lease payments based on contracted percentages of revenue. Generally, leases do not grant any right to the lessee to purchase the underlying asset at the end of the lease term. Dolby Cinema lease arrangements have options to extend the lease term at expiration by increments ranging from 1 to 5 years. Assets provided under an operating lease are carried at cost within property, plant, and equipment, net on the unaudited interim condensed consolidated balance sheets, and depreciated over the useful life of the asset using the straight-line method. Fixed operating lease payments are recognized on a straight-line basis over the lease term to revenue. Variable lease payments received under our Dolby Cinema operating leases are computed as shares of lessees' box office revenue and recognized to revenue in the period that box office sales occur. Lease incentive payments we make to lessees are amortized as a reduction in revenue over the lease term. The components of lease income were as follows (in thousands):
| Fiscal Quarter Ended |  | Fiscal Year-To-Date Ended
| March 31, 2023 |  | April 1, 2022 |  | March 31, 2023 |  | April 1, 2022
Operating Lease Income |  |  |  |  |  |  |
Variable operating lease income | $ | 10,657 |  |  | $ | 6,409 |  |  | $ | 16,985 |  |  | $ | 14,477 |
Fixed operating lease income | 781 |  |  | 691 |  |  | 1,528 |  |  | 1,547 |
If a lease is classified as a sales-type lease, the carrying amount of the asset is derecognized from property, plant, and equipment, net, and a net investment in the lease is recorded. The net investment in the lease is measured at commencement date as the sum of the lease receivable and the estimated residual value of the equipment. The unguaranteed residual value of the equipment is determined as the estimated carrying value of the asset at the end of the lease term had the asset been depreciated on a straight-line basis. The unguaranteed residual value of sales-type leases was $1.0 million and $1.1 million as of March 31, 2023 and September 30, 2022, respectively. Selling profit or loss arising from a sales-type lease is recorded at lease commencement and presented on a gross basis. Over the term of the lease, we recognize interest income on the net investment in the lease, and variable lease payments, which are not included in the net investment in the lease. The variable lease payments are not material. The following table presents the maturity analysis of fixed lease payments due to Dolby (in thousands):
| March 31, 2023
| Operating Leases |  | Sales-Type Leases
Remainder of Fiscal 2023 | $ | 54 |  |  | $ | 1,595 |
Fiscal 2024 | 798 |  |  | 795 |
Fiscal 2025 | 818 |  |  | 395 |
Fiscal 2026 | 732 |  |  | 395 |
Fiscal 2027 | — |  |  | — |
Thereafter | — |  |  | — |
Total undiscounted cash flows | $ | 2,402 |  |  | 3,180 |
Less: Carrying value of lease receivables |  |  | (487) |
Difference |  |  | $ | 2,693 |
Leases | Leases As Lessee As a lessee, we enter into contracts to access and utilize office space, including those payable to our principal stockholder and portions attributable to the noncontrolling interests in our consolidated subsidiaries. The following table presents the maturity analysis of lease liabilities (in thousands):
| March 31, 2023 |  |
| Operating Leases |  |
Remainder of Fiscal 2023 | $ | 7,240 |  |  |
Fiscal 2024 | 13,622 |  |  |
Fiscal 2025 | 10,138 |  |  |
Fiscal 2026 | 6,314 |  |  |
Fiscal 2027 | 3,993 |  |  |
Thereafter | 11,505 |  |  |
Total undiscounted lease payments | 52,812 |  |  |
Less: imputed interest | (4,944) |  |  |
Total lease liabilities | $ | 47,868 |  |  |
As Lessor As a lessor, we lease our Dolby Cinema product solution to exhibitors. The terms of these leases are typically 10 years. Lease components consist of fixed payments and/or variable lease payments based on contracted percentages of revenue. Generally, leases do not grant any right to the lessee to purchase the underlying asset at the end of the lease term. Dolby Cinema lease arrangements have options to extend the lease term at expiration by increments ranging from 1 to 5 years. Assets provided under an operating lease are carried at cost within property, plant, and equipment, net on the unaudited interim condensed consolidated balance sheets, and depreciated over the useful life of the asset using the straight-line method. Fixed operating lease payments are recognized on a straight-line basis over the lease term to revenue. Variable lease payments received under our Dolby Cinema operating leases are computed as shares of lessees' box office revenue and recognized to revenue in the period that box office sales occur. Lease incentive payments we make to lessees are amortized as a reduction in revenue over the lease term. The components of lease income were as follows (in thousands):
| Fiscal Quarter Ended |  | Fiscal Year-To-Date Ended
| March 31, 2023 |  | April 1, 2022 |  | March 31, 2023 |  | April 1, 2022
Operating Lease Income |  |  |  |  |  |  |
Variable operating lease income | $ | 10,657 |  |  | $ | 6,409 |  |  | $ | 16,985 |  |  | $ | 14,477 |
Fixed operating lease income | 781 |  |  | 691 |  |  | 1,528 |  |  | 1,547 |
If a lease is classified as a sales-type lease, the carrying amount of the asset is derecognized from property, plant, and equipment, net, and a net investment in the lease is recorded. The net investment in the lease is measured at commencement date as the sum of the lease receivable and the estimated residual value of the equipment. The unguaranteed residual value of the equipment is determined as the estimated carrying value of the asset at the end of the lease term had the asset been depreciated on a straight-line basis. The unguaranteed residual value of sales-type leases was $1.0 million and $1.1 million as of March 31, 2023 and September 30, 2022, respectively. Selling profit or loss arising from a sales-type lease is recorded at lease commencement and presented on a gross basis. Over the term of the lease, we recognize interest income on the net investment in the lease, and variable lease payments, which are not included in the net investment in the lease. The variable lease payments are not material. The following table presents the maturity analysis of fixed lease payments due to Dolby (in thousands):
| March 31, 2023
| Operating Leases |  | Sales-Type Leases
Remainder of Fiscal 2023 | $ | 54 |  |  | $ | 1,595 |
Fiscal 2024 | 798 |  |  | 795 |
Fiscal 2025 | 818 |  |  | 395 |
Fiscal 2026 | 732 |  |  | 395 |
Fiscal 2027 | — |  |  | — |
Thereafter | — |  |  | — |
Total undiscounted cash flows | $ | 2,402 |  |  | 3,180 |
Less: Carrying value of lease receivables |  |  | (487) |
Difference |  |  | $ | 2,693 |

X
- References No definition available. + Details
Name: | us-gaap_LeasesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI https://asc.fasb.org/subtopic&trid=77888251 + Details
Name: | us-gaap_LesseeOperatingLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure of lessor's sales-type leases. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 30 -URI https://asc.fasb.org/subtopic&trid=77888252 + Details
Name: | us-gaap_LessorSalesTypeLeasesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration