Core Viewpoint - Opera's strong second-quarter earnings and positive regulatory environment have led to a significant rally in its stock price, indicating investor optimism about the company's future growth potential [1][2]. Financial Performance - Opera reported a 17% revenue growth to $109.7 million and earnings per share of $0.22, which is a 46.7% increase, both surpassing analyst expectations [3]. - The company has raised its guidance for the full year, reflecting confidence in continued growth [3]. Market Position and Strategy - Opera is focusing on higher-revenue markets such as the U.S., Europe, and Latin America, moving away from lower-revenue emerging markets [4]. - Despite a decrease in total monthly active users (MAUs), the average revenue per user increased by 25% due to growth in digital advertising and search revenue [5]. Regulatory Environment - New regulations like the Digital Markets Act in Europe are creating opportunities for Opera by challenging the dominance of tech giants and potentially increasing user choice for default browsers [6][7]. - The recent declaration of Alphabet as a monopoly by a U.S. federal judge may further open up the market for Opera [6]. Growth Potential - Management believes there is significant upside potential, estimating that capturing even a small market share could lead to substantial revenue increases, citing a potential 10 to 20 times growth opportunity [8]. - Opera is investing in new technologies, including a $19 million investment in an AI cluster in Iceland, which is expected to enhance its offerings [9]. Future Outlook - The company's neutral browser status, popularity among gamers, and commitment to AI technology position it well for future growth [10].

Financial Data and Key Metrics Changes - Revenue for Q2 2024 was $110 million, representing a 17% year-over-year growth [4] - Adjusted EBITDA was $27 million, translating to a margin of 24%, exceeding guidance of $22 million to $25 million [4][18] - Average Revenue Per User (ARPU) grew by 25% year-over-year, now at an annualized $1.46 across products and geographies [4] Business Line Data and Key Metrics Changes - Advertising revenue reached $65 million, growing 20% year-over-year, driven by high-ARPU user growth and expanding monetization opportunities [4][5] - Search revenue was $45 million, up 15% year-over-year, indicating strong retention of engaged users [5] - Opera GX, the gaming browser, added 500,000 users in the quarter, achieving 30 million Monthly Active Users (MAUs) with a year-over-year growth of 27% [13] Market Data and Key Metrics Changes - Significant user adoption growth in the EU, particularly for Opera on Android and iOS, attributed to the Digital Markets Act (DMA) [7] - The company noted a flat sequential user base in Western markets, indicating potential seasonality or marketing spend adjustments [31] Company Strategy and Development Direction - The company is focusing on e-commerce opportunities as a key growth driver, with a strong emphasis on high-value user acquisition [18][22] - Continued investment in AI capabilities is expected to enhance user experience and monetization potential [14][15] - The launch of Opera One and Opera GX is aimed at increasing market share and user engagement, particularly in the gaming sector [10][12] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth trajectory for the second half of 2024, raising full-year revenue guidance to $461 million to $467 million [22] - The company is cautiously optimistic about the holiday season, anticipating increased e-commerce activity [22] - Management highlighted the importance of regulatory changes, such as the DMA, in creating opportunities for independent players like Opera [28][29] Other Important Information - The company announced a semi-annual dividend of $0.40 per ADS, totaling $35.4 million [21] - Operating cash flow was $17.4 million, representing 65% of adjusted EBITDA, with free cash flow from operations at $13.5 million [20] Q&A Session Summary Question: Thoughts on the DMA and its implementation - Management believes the DMA has been beneficial for independent players and is working closely with the EU to ensure broader application of gatekeeper definitions [26][28] Question: Drivers of e-commerce trends - The company has built a sizable user base in high-value markets, allowing for new partnerships that drive meaningful traffic with high purchase intent [30] Question: User base trends in Western markets - Management noted a flat trend in Western markets due to a focus on high-value users and increased marketing costs [31] Question: Impact of regulatory shifts on product prioritization - Management sees regulatory shifts as beneficial, allowing for more investment in platforms like iOS and Windows [33][34] Question: Feedback on the Aria assistant and AI adoption - The application of AI is becoming more integrated into daily user experiences, positively impacting monetization [37][38] Question: Cost structure impact from AI initiatives - The company has been disciplined in managing operational costs related to AI, focusing on cost-effective solutions [41][44] Question: Returns from the AI cluster investment in Iceland - The AI cluster has been operational since Q2 and is being used for fine-tuning tasks, with positive revenue generation expected [46][47] Question: Expected impact of Google antitrust ruling on search revenue - Management believes that the focus should be on broader monetization opportunities beyond search, with a positive outlook for e-commerce revenue [48][49] Question: Growth potential of Opera GX - The user base of Opera GX is evenly split between Western and non-Western markets, with significant monetization potential in both [52] Question: Future opportunities in Latin America - Latin America is identified as a fast-growing market, with high hopes for user and advertising monetization growth [59]

Opera (NASDAQ:OPRA) just reported results for the second quarter of 2024. Opera reported earnings per share of 22 cents. This met the analyst estimate for EPS of 22 cents. The company reported revenue of $109.73 million. This was 1.10% better than the analyst estimate for revenue of $108.54 million. InvestorPlace Earnings is a project that leverages data from TradeSmith to automate coverage of quarterly earnings reports. InvestorPlace Earnings distills key takeaways including earnings per share and revenue, ...

100 t would III " III W H 011 WI illi lle istanbulimage Investment Thesis Opera Limited (NASDAQ:OPRA), which provides the contentious tier-3 browser, reported solid results that beat on the top line and the bottom line and raised its fullyear guidance. What's more, the stock looks incredibly cheap at 10x this year's EBITDA, with no debt, all the while paying out a 6.1% dividend yield. But is this stock a value trap? I don't believe so. As such, I remain bullish on OPRA as I've done for some time. Rapid Reca ...

Revenue grew 17% year-over-year to $109.7 million, and exceeded the guidance range Adjusted EBITDA of $26.6 million, a 24% margin, also exceeded the guidance range Product lineup further strengthened with Opera One launched on iOS along with rapid innovation across platforms Company increases both revenue and adjusted EBITDA guidance for the year, now at 17% year-over-year growth at a 24% adjusted EBITDA margin at the midpoints OSLO, Norway, Aug. 22, 2024 /PRNewswire/ -- Opera Limited (NASDAQ: OPRA), one of ...

OSLO, Norway, Aug. 7, 2024 /PRNewswire/ -- Opera Limited (NASDAQ: OPRA), one of the world's major browser developers and a leading internet consumer brand, announced today that the company's second quarter 2024 financial results will be released before the market opens on Thursday, August 22, 2024. The earnings release will be available on the investor relations section of our website at https://investor.opera.com. Management will host a conference call to discuss the second quarter 2024 financial results o ...

Core Viewpoint - Opera Limited's recent financial performance shows strong revenue growth and cash flow generation, despite a decline in net income due to increased capital expenditures and lower interest income [2][6][22]. Financial Performance - In Q1 FY2024, Opera reported consolidated sales of nearly $102 million, reflecting a 17% year-over-year increase [6]. - The company's EBIT surged by 40.3% year-over-year to $19.6 million, achieving a 19% margin [6]. - Operating cash flow reached $31.0 million, sufficient to cover dividends and capital expenditures, resulting in a cash position of $91.3 million [2]. User Growth and Market Position - Opera has 304 million monthly active users (MAUs), representing about 8% of global internet users, with a growing segment of high ARPU users in North America, Europe, and Latin America [2][7]. - The Opera GX gaming browser saw a 6% quarter-over-quarter increase in MAUs, reaching 29.5 million [2]. Strategic Initiatives - The company has invested $20.2 million in a new AI data cluster in Iceland, which is now operational and expected to support future sales expansion [2][7]. - Opera's management focuses on quality user growth, targeting high-ARPU markets, which is expected to enhance operating leverage [7]. Revenue Guidance and Future Outlook - For Q2 FY2024, Opera expects revenue between $107 million and $109 million, indicating a year-over-year growth of 14-16% [7]. - The company raised its FY2024 revenue guidance to a range of $454 million to $465 million, while maintaining an EBITDA forecast of $106 million to $110 million [7]. Valuation and Market Sentiment - Opera's market cap is just over $1 billion, with the company generating over 10% of its market cap in revenue in a single quarter [8]. - The stock is considered undervalued, with a P/E ratio significantly lower than sector averages, suggesting potential for price appreciation [8][9]. Risks and Considerations - The current search distribution agreement with Google has been extended until 2025, which is crucial for Opera's revenue stream [8][11]. - Concerns exist regarding the potential need to renegotiate this agreement under less favorable terms in the future [11].

Core Insights - Opera GX is enhancing its built-in AI, Aria, with significant updates that include new features such as image generation, voice output, chat summary, and links to sources [1][9]. AI Features Update - The update introduces image generation capabilities using Google's Imagen2 model, allowing users to create unique images from text prompts, with a limit of 30 images per day per user [7]. - Aria can now read answers aloud using Google's WaveNet model, benefiting users who prefer auditory information [2]. Image Understanding - Users can upload images to Aria and inquire about them, enabling the AI to identify objects, brands, and provide contextual information [3]. Chat Experience Improvements - The chat experience has been enhanced with a "Chat Summary" feature that provides concise recaps of conversations and "Links to Sources" for additional context [4]. - A reworked Aria Command Line allows users to activate the AI more easily, improving accessibility [4]. Availability - The Aria update is currently available for all Opera GX users [5]. Company Background - Opera GX has rapidly gained popularity among gamers since its launch in 2019, offering customization options and features that optimize resource usage for gaming [11].

We previously covered Opera Limited (NASDAQ:OPRA) in March 2024, discussing why we had maintained our Buy rating, as the management increasingly monetized its gaming platform, advertising, and search engine capabilities. Combined with the management's use of robust cash flow for shareholder returns, we believed that it continued to offer both value and growth opportunities at current levels. Since then, OPRA has retraced by -9.4% well underperforming the wider market at +6%, or rallied by +28.2% from our pr ...

The aggregate amount of the dividend is approximately $35.4 million, based on a total of 88.5 million ADS equivalents outstanding. Opera's cash expense will be approximately $27.6 million. The remaining $7.8 million will be offset against Opera's remaining receivable from our majority shareholder, Kunlun Tech Limited ("Kunlun") in connection with the 2022 sale of Opera's stake in Star Group Interactive Inc. This press release contains statements of a forward-looking nature. These statements, including state ...