Dolby Laboratories (NYSE: DLB) is expected to report Q3 earnings on July 25. Here's what Wall Street wants to see:

The 10-second takeaway
Comparing the upcoming quarter to the prior-year quarter, average analyst estimates predict Dolby Laboratories's revenues will increase 0.3% and EPS will contract -28.1%.

The average estimate for revenue is $208.5 million. On the bottom line, the average EPS estimate is $0.41.

Revenue details
Last quarter, Dolby Laboratories chalked up revenue of $249.3 million. GAAP reported sales were 5.1% lower than the prior-year quarter's $262.8 million.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Last quarter, non-GAAP EPS came in at $0.74. GAAP EPS of $0.60 for Q2 were 26% lower than the prior-year quarter's $0.81 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Recent performance
For the preceding quarter, gross margin was 90.7%, 30 basis points worse than the prior-year quarter. Operating margin was 33.8%, much worse than the prior-year quarter. Net margin was 24.8%, 870 basis points worse than the prior-year quarter.

Looking ahead

The full year's average estimate for revenue is $922.0 million. The average EPS estimate is $2.24.

Investor sentiment
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 3,814 members out of 3,915 rating the stock outperform, and 101 members rating it underperform. Among 1,095 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 1,075 give Dolby Laboratories a green thumbs-up, and 20 give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Dolby Laboratories is hold, with an average price target of $32.33.

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