Core Viewpoint - Opera's shares increased following a significant revenue surge and positive guidance, despite a year-to-date decline in stock price [1] Group 1: Company Overview - Opera operates a range of web and mobile browsers aimed at optimizing speed and battery life, with a focus on emerging markets and higher-valued users from developed markets [2] - The fastest-growing browser is Opera GX, which is tailored for gaming performance [2] Group 2: Revenue and Growth - In Q1, Opera's revenue surged 40% to $142.7 million, exceeding guidance of $130 million to $133 million [4] - Advertising revenue increased by 63% to $95.6 million, while search revenue rose 8% to $46.6 million [4] - E-commerce led the advertising growth, with revenue from this vertical more than doubling [5] Group 3: User Metrics and Innovations - The annualized average revenue per user (ARPU) increased by 45% year over year to $1.94, although monthly active users (MAU) decreased by 4% from 304 million to 293 million [6] - Opera GX's user base grew by 14% in the quarter to 34 million MAUs [6] - The new Opera Air browser targeting Western users was downloaded 500,000 times in its first two months [7] - Opera introduced agentic AI features in its Browser Operator to assist users with tasks like travel bookings [8] Group 4: Profitability and Future Guidance - Adjusted EPS rose 35% to $0.27, and adjusted EBITDA climbed 29% to $32.3 million [9] - For Q2, the company forecasts revenue growth of around 24%, projecting between $134 million to $138 million [9] - Full-year revenue guidance was raised to a range of $567 million to $582 million, indicating a 20% annual growth at the midpoint [10] Group 5: Market Position and Valuation - Opera is optimistic about navigating the uncertain macro environment and sees potential opportunities from big tech antitrust cases [11] - The stock trades at a forward P/E ratio of 14.6 times with a projected 20% revenue growth, indicating it is not expensive [13] - The company holds $103.5 million in net cash and an investment in OPay valued at $258.3 million, which is a fast-growing fintech company in Africa [13][14]

I recently graduated from The University of Tampa with a degree in finance. My investment style is mainly fundamental, hoping to find companies with good growth prospects trading at low multiples. Additionally, my goal is to look for hidden gem companies that have solid balance sheets with great management. Since my last article , Opera (NASDAQ: OPRA ) shares have had a wild ride. The last few months have seen large fluctuations in the share price, with highs around the $22s and lows as far as the $12s. I'm ...

Financial Data and Key Metrics Changes - Revenue growth accelerated to 40% year over year in Q1 2025, up from 29% in Q4 2024, exceeding previous guidance of 28% to 31% [4][15] - Total revenue for Q1 2025 reached $143 million, with advertising revenue growing 63% and now representing two-thirds of total revenue [5][15] - Adjusted EBITDA was $32 million, with a margin of 23%, indicating increased profitability alongside revenue growth [6][15] Business Line Data and Key Metrics Changes - E-commerce was the fastest-growing vertical within advertising, achieving over 100% annualized growth, which offset typical seasonality [5][15] - Search revenue grew 8% year over year, indicating a slowdown compared to previous growth rates [5][32] - The user base remained stable at 293 million monthly active users (MAUs), with annualized ARPU increasing by 44% [7][15] Market Data and Key Metrics Changes - The U.S. market is experiencing greater uncertainty among advertisers, impacting growth potential [15][21] - The company has less exposure to U.S. e-commerce compared to competitors, suggesting significant growth opportunities ahead [22][63] Company Strategy and Development Direction - The company is focusing on high-value users and leveraging AI to optimize advertising and search revenue [6][10] - Opera is expanding its browser portfolio, including the introduction of AI-driven features, to enhance user experience and engagement [8][10] - The company aims to maintain aggressive growth in e-commerce while navigating macroeconomic challenges [21][63] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's ability to grow despite a volatile macro environment, highlighting a strong track record of navigating challenges [13][21] - The company raised its full-year revenue guidance to DKK 567 million to DKK 582 million, reflecting confidence in continued growth [24][21] - Management noted that the advertising revenue is primarily performance-based, making it more resilient in uncertain economic conditions [22][67] Other Important Information - The company celebrated its 25th anniversary in 2025, emphasizing its long history of innovation and adaptation [13] - Opera has distributed $2.4 in dividends per share since January 2023, indicating a commitment to returning value to shareholders [21] Q&A Session Summary Question: Search growth during the quarter - Management acknowledged that the 8% growth in search revenue is a slowdown but attributed it to a shift towards intent-based advertising, which is driving overall advertising growth [32][34] Question: Decline in GX ARPU - Management noted that the decline in GX ARPU is partly seasonal and that the introduction of AI and high-intent advertising options is expected to benefit overall revenue [32][36] Question: Impact of currency on growth - Management indicated that the strong U.S. dollar has been a headwind, estimating that growth would have been 5 to 6 percentage points higher on a constant currency basis [38] Question: E-commerce growth and seasonality - Management confirmed that the rapid growth of e-commerce has offset typical seasonality, but acknowledged that seasonality will still be a factor as the business matures [41][44] Question: Concerns about MAU count - Management clarified that the focus is on high ARPU users rather than total MAU count, emphasizing revenue generation over user numbers [46][48] Question: U.S. antitrust actions and broader ecosystem - Management expressed that ongoing antitrust discussions could benefit Opera by increasing focus on competition and innovation in the browser market [49][52] Question: E-commerce opportunity and geographic exposure - Management highlighted that the e-commerce segment is growing rapidly and that the U.S. market still holds significant potential for future growth [56][58] Question: Gating factors for e-commerce growth - Management stated that attracting performance-focused advertisers is key to expanding e-commerce revenue, with a focus on larger retailers initially [61][64]

Group 1 - Opera Limited (NASDAQ: OPRA) has demonstrated strong performance with a robust Q1 earnings report, emphasizing its browser's superior functionality compared to competitors like Google's [1] - The company aims to communicate to investors that its browsers are smarter and more capable than others in the market [1] Group 2 - The investment landscape includes a focus on undervalued stocks with high growth potential, driven by quality management and attractive valuations [2] - The marketplace for investment opportunities is expanding rapidly, highlighting the importance of selecting stocks that deliver strong gains [3] - The emphasis is on providing high-quality, actionable stock picks that are centered around value [3]

Group 1 - Opera Ltd (NASDAQ: OPRA) reported a first-quarter earnings beat and raised its fiscal-year forecast for 2025, leading to a 4.4% increase in share price to $16.21 [1] - The stock has gained 13.1% over the past five trading sessions, although it remains below its 18-month high of $22.50 reached on February 18 [1] - Year-to-date, OPRA shares are down 14.6%, but they have increased by 21% year-over-year [1] Group 2 - All analysts covering OPRA maintain "buy" ratings, with only 2.2% of the stock's float sold short, despite a 35% increase in short interest recently [2] - The options market for OPRA has become active, with call options trading at three times the average intraday volume and put options trading at eight times the average [3] - The July 17.50 call option is seeing significant selling activity, along with the popular May 17.50 call option [3]

Financial Performance & Growth - Opera achieved 16 quarters of Rule of 40+ performance, calculated as revenue growth plus Adjusted EBITDA margin[14] - The company's 2025 revenue guidance is $575 million[18] - The 2025 Adjusted EBITDA guidance is $138 million[18] - The company's Q2 2025 revenue guidance is $136 million[104] User Base & Engagement - Opera has approximately 293 million average MAUs in Q1 2025[14] - Western markets experienced a 39% user growth over the last 4 years[14] - ARPU has grown 3.6x over the last 4 years[17] Revenue Model - Advertising accounts for 67% of Q1 2025 revenue[81] - Search contributes 33% of Q1 2025 revenue[82] User Acquisition - 79% of new users come from organic traffic[80] Gamer Focus - Opera GX has 34 million users[46] - Opera GX users represent 8% penetration of the estimated total addressable market (TAM) of 400 million+ gamers[60]

Core Insights - Opera Limited reported a revenue of $142.72 million for the quarter ended March 2025, marking a 40.1% increase year-over-year [1] - The earnings per share (EPS) for the quarter was $0.27, up from $0.17 in the same quarter last year [1] - The reported revenue exceeded the Zacks Consensus Estimate of $131.53 million by 8.50%, while the EPS also surpassed the consensus estimate of $0.26 by 3.85% [1] Revenue Breakdown - Search revenue was $46.59 million, below the two-analyst average estimate of $50.44 million [4] - Advertising revenue reached $95.61 million, significantly higher than the average estimate of $80.19 million from two analysts [4] - Revenue from technology licensing and other sources was $0.52 million, exceeding the estimated $0.10 million by two analysts [4] Stock Performance - Over the past month, shares of Opera Limited have returned -4%, slightly better than the Zacks S&P 500 composite's -4.3% change [3] - The stock currently holds a Zacks Rank 1 (Strong Buy), suggesting potential outperformance against the broader market in the near term [3]

Financial Data and Key Metrics Changes - Revenue growth increased from 29% in Q4 2024 to 40% in Q1 2025, translating to revenue of $143 million for Q1 2025, exceeding previous guidance [5][6] - Adjusted EBITDA reached $32 million with a margin of 23%, indicating profitability alongside revenue growth [7][18] - Annualized ARPU grew by 44% year over year, reflecting a focus on high-value users [8] Business Line Data and Key Metrics Changes - Advertising revenue grew by 63% in Q1 2025, now representing two-thirds of total revenue, with e-commerce being the fastest-growing vertical at over 100% annualized growth [6][8] - Search revenue was $7 million, growing 8% year over year, indicating a stable growth despite a shift towards e-commerce [6][30] Market Data and Key Metrics Changes - The user base remained stable at 293 million MAUs, with a focus on high ARPU potential users [8][47] - The U.S. market is seen as having significant growth potential in e-commerce, with the company having less exposure compared to competitors [22][64] Company Strategy and Development Direction - The company aims to leverage AI for optimizing user intent and enhancing advertising effectiveness, which is expected to drive future growth [7][50] - Opera is focusing on performance-based advertising, which is more resilient in volatile market conditions, allowing for continued growth [22][67] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by macroeconomic volatility but expressed confidence in the company's ability to navigate these challenges and capitalize on growth opportunities [21][24] - The company raised its full-year revenue guidance to DKK 567 million to DKK 582 million, reflecting optimism about continued growth [24][25] Other Important Information - The company celebrated its anniversary and highlighted its history of navigating market disruptions and competition [13][14] - The company has distributed $2.4 in dividends per share since January 2023, indicating a commitment to returning value to shareholders [21] Q&A Session Summary Question: Search growth slowdown and its impact - Management noted that the shift towards intent-based advertising is influencing search growth, which is still expected to grow strongly in the future [30][34] Question: Impact of currency on growth - The strong U.S. dollar has been a headwind, with growth estimated to be 5-6 percentage points higher on a constant currency basis [38] Question: E-commerce growth and seasonality - E-commerce growth has been strong enough to offset typical seasonality, but management expects some seasonality to return as the business matures [41][44] Question: User base concerns - The focus is on high ARPU users rather than total MAUs, with management confident in revenue growth despite a slight decline in user numbers [47] Question: U.S. antitrust actions and their impact - Management sees potential benefits from increased competition and focus on user intent, positioning Opera favorably in the evolving ecosystem [48][50] Question: E-commerce advertiser diversification - The e-commerce opportunity is growing rapidly, with a focus on performance-based partnerships, particularly in the U.S. market [56][64]

Core Insights - Opera Limited reported a 40% year-over-year revenue growth, reaching $142.7 million for the first quarter of 2025, significantly exceeding guidance [1][6][17] - The company achieved an adjusted EBITDA of $32.3 million, representing a 23% margin, also surpassing expectations [1][13] - Opera raised its full-year guidance for both revenue and adjusted EBITDA based on strong Q1 performance [1][18] Financial Performance - Revenue increased from $101.9 million in Q1 2024 to $142.7 million in Q1 2025, a 40% increase [4][6] - Net income rose to $18.3 million, a 23% increase from $14.8 million in the same quarter last year [4][11] - Adjusted net income grew by 37% to $24.2 million, maintaining a 17% margin [4][12] - Adjusted EBITDA increased by 29% to $32.3 million, with a margin of 23% [4][13] - Diluted earnings per share increased to $0.20, while adjusted diluted earnings per share rose to $0.27 [4][13] Revenue Breakdown - Advertising revenue surged by 63% to $95.6 million, accounting for 67% of total revenue [7][20] - Search revenue grew by 8% to $46.6 million, representing 33% of total revenue [7][20] - Technology licensing and other revenue was $0.5 million [20] User Metrics - Opera had 293 million average monthly active users (MAUs) in the quarter, with an annualized average revenue per user (ARPU) of $1.94, a 45% increase year-over-year [7][20] - The Opera GX gaming browser recorded 34 million average MAUs, up 14% year-over-year [7] Operating Expenses - Operating expenses increased by 47% to $121.6 million [8] - Share-based compensation expenses rose by 130% year-over-year to $6.0 million [20] - Marketing and distribution expenses increased by 16% to $34.2 million [20] Business Outlook - For Q2 2025, the company guides revenue between $134 million and $138 million, reflecting a 24% year-over-year growth [15] - Full-year 2025 revenue guidance is set between $567 million and $582 million, with an expected 20% growth [15]

Core Insights - Opera Limited (OPRA) is expected to report first-quarter 2025 earnings on April 28, with anticipated revenues between $130 million and $133 million, reflecting a 29% year-over-year growth [1] - The consensus estimate for earnings is set at 26 cents per share, indicating a significant year-over-year increase of 52.94% [2] Revenue Growth Factors - The advertising business is projected to have continued its strong performance, growing 38% year-over-year in Q4 2024, driven by e-commerce segments and performance-based advertising models [3] - Solid growth in Western markets, particularly in Europe and the U.S., is attributed to increased iOS downloads and favorable regulatory shifts [4] User Engagement and Technology - Investments in AI technologies and the integration of AI features into new browser versions like Opera R2 and Opera One have enhanced user experience and engagement [5] - Opera GX, the gaming browser, has seen a 22% year-over-year increase in its user base, reaching 33.9 million monthly active users, contributing to revenue growth [6] Operational Considerations - Rising operational expenses, which increased from 27.1% in Q4 2024, may impact overall profitability in the upcoming quarter [7] Earnings Expectations - Opera Limited currently has an Earnings ESP of 0.00% and a Zacks Rank 1 (Strong Buy), indicating mixed signals regarding the likelihood of an earnings beat [8]