Company Overview - Opera has been operating for 30 years and maintains a start-up mentality [2] - The company originated in Norway in the 1990s, initially competing with Netscape [2] - Opera develops web browsers for both computers and phones, establishing itself as an independent player in the market [2] User Base and Market Growth - Opera has built a user base of nearly 300 million monthly users, with significant growth in both emerging and Western markets [2][3] - The company offers feature-rich browsers tailored to specific segments, including a browser designed for gamers [3] Financial Performance - Opera reported close to $600 million in revenue [3] - The company has provided a midpoint guidance for growth of 23% for the current year, with an EBITDA margin expected to match this growth rate [3]

Summary of Opera's 2025 Conference Call Company Overview - **Company**: Opera (NasdaqGS: OPRA) - **Industry**: Web Browsers and Internet Services - **User Base**: Approximately 300 million monthly users, with a significant presence in both emerging and Western markets [4][6] - **Revenue**: Close to $600 million, with a growth guidance of 23% for the year [4][5] Key Points and Arguments User Demographics and Growth - **Geographic Split**: 20% of users in Western markets, up from 6-7% previously, indicating successful market penetration [6][12] - **ARPU Growth**: Average Revenue Per User (ARPU) has tripled over the past four years, driven by higher monetization in Western markets [6][12] - **Target Audience**: Focus on tech-savvy users who appreciate feature-rich browsers, particularly in the gaming segment [6][10] Competitive Landscape - **EU Regulations**: The Digital Markets Act has positively impacted Opera, leading to a doubling of new iOS users in the EU [12][13] - **U.S. Market**: Ongoing partnership with Google for search revenue, with no expected changes following recent regulatory rulings [15][19] Artificial Intelligence Integration - **AI Features**: Introduction of AI functionalities in the flagship browser, Opera One, allowing users to interact with an AI agent [20][21] - **Opera Neon**: Upcoming AI-native browser designed to enhance user experience by integrating AI capabilities directly into the browsing process [24][27] Gaming Browser Opportunity - **User Base**: 33 million users of the gaming browser (Opera GX), with an average ARPU of $3.50, representing about 20% of total revenue [32][33] - **Market Expansion**: Plans to expand into key Asian markets like Japan and South Korea, which present significant growth potential [32][33] Growth Investments and Financial Strategy - **Investment Focus**: Prioritizing high-value user growth and product development, particularly for Opera One and Opera GX [34][41] - **Capital Return**: Nearly $500 million returned to shareholders since 2020, with a preference for dividends over buybacks to maintain liquidity [40][41] Future Outlook - **Strategic Priorities**: Focus on leveraging AI and enhancing browser capabilities to attract more users and increase brand awareness [44][47] - **Long-term Vision**: Emphasis on the evolving role of browsers in users' daily lives, with aspirations to innovate and provide alternatives in the market [46][47] Additional Important Insights - **Marketing Effectiveness**: Data-driven marketing strategies are in place to assess ROI and optimize campaigns for user acquisition [35][36] - **AI Partnerships**: Collaborations with Google and OpenAI for backend AI functionalities, while maintaining control over local processing [29][30] This summary encapsulates the key insights from Opera's conference call, highlighting the company's strategic direction, market positioning, and future growth opportunities.

Company Overview - Opera has a diverse portfolio that includes browsers and various products, particularly in the payments sector, benefiting from multiple secular tailwinds globally, especially in North America [2]. User Metrics - Opera boasts 289 million global monthly active users, indicating significant scale and user engagement compared to other companies in the sector [3].

Summary of Opera (OPRA) 2025 Conference Call Company Overview - **Company**: Opera - **Industry**: Internet and Software - **Monthly Active Users**: 289 million globally [1][8] - **Revenue Guidance**: Close to $600 million for the year, with a growth rate of approximately 23% [8][55] - **Profitability**: Company has maintained a "Rule of 40" status for 16-17 quarters, balancing growth and profitability [8] Product Portfolio - **Browsers**: Opera has developed a portfolio of browsers catering to different user needs, including Opera One, GX (for gamers), Air (mindfulness-focused), and Neon (AI-oriented) [21][27] - **AI Integration**: Opera Neon aims to integrate AI functionalities directly into the browsing experience, enhancing productivity for users [29][32] - **Target Audience**: Focus on tech-savvy users and specific segments like gamers, rather than a broad audience [27][54] Market Dynamics - **Partnership with Google**: Opera has a long-standing partnership with Google, which accounts for about one-third of its total revenue. Recent rulings allow Google to continue paying for traffic, which is beneficial for Opera [10][14] - **Browser Market**: The browser market is gaining more attention, with Opera positioning itself as a valuable player in the space, especially as AI companies highlight the importance of browsers [18][20] Financial Performance - **Revenue Composition**: Advertising revenue has grown significantly, now accounting for two-thirds of total revenue, while search revenue has become a smaller portion [71] - **ARPU Growth**: The average revenue per user (ARPU) has quadrupled over the past four years, with a 30% increase in the Western user base [55] Marketing Strategy - **Brand Awareness**: Opera spends approximately 30% of its revenue on marketing, focusing on influencers and tech media to build brand identity [59][60] - **Targeted Marketing**: The company targets specific user groups, such as gamers, to improve retention and engagement [66] Future Outlook - **Product Launch**: Opera Neon is set to launch soon, with expectations that it will leverage AI to enhance user productivity [43][45] - **E-commerce Growth**: E-commerce partnerships have seen over 100% year-over-year growth, indicating a strong revenue potential moving forward [76] Additional Insights - **User Base Strategy**: Opera has shifted focus from feature phone users in emerging markets to higher ARPU potential users in developed regions [53] - **Predictability in Revenue**: The company has a high degree of predictability in revenue generation due to the vast amounts of data collected from user interactions [78] Conclusion - **Overall Positioning**: Opera is strategically positioned in the browser market with a diverse product portfolio and a strong focus on integrating AI to enhance user experience. The company is also leveraging its long-term partnership with Google to maintain revenue growth and market presence.

Core Insights - The article emphasizes the importance of conducting personal in-depth research and due diligence before making investment decisions, highlighting the inherent risks involved in trading [3]. Group 1 - The analysis is intended solely for informational purposes and should not be interpreted as professional investment advice [3]. - There is a clear disclaimer regarding the lack of any stock, option, or similar derivative positions in the companies mentioned, indicating a neutral stance [2]. - The article expresses that past performance does not guarantee future results, reinforcing the need for careful consideration by investors [4].

Core Insights - Opera Limited (NASDAQ: OPRA) experienced a significant stock drop despite reporting good earnings, indicating potential market misinterpretation or external factors affecting investor sentiment [1]. Company Analysis - The company focuses on sectors such as AI, fintech, finance, and technology, which are critical for long-term growth and investment opportunities [1]. - Opera Limited is actively analyzed for its business model, earnings performance, and competitive positioning within the market [1]. Market Context - The stock market's reaction to Opera Limited's earnings report suggests a disconnect between financial performance and stock valuation, highlighting the importance of understanding market dynamics [1].

Core Insights - Opera Limited reported $142.96 million in revenue for the quarter ended June 2025, marking a year-over-year increase of 30.3% [1] - The earnings per share (EPS) for the same period was $0.26, compared to $0.22 a year ago [1] - The reported revenue exceeded the Zacks Consensus Estimate of $137.81 million by 3.74%, while the EPS fell short of the consensus estimate of $0.27 by 3.7% [1] Revenue Breakdown - Revenue from Search was $44.55 million, below the estimated $47.97 million [4] - Revenue from Advertising was $64.63 million, significantly lower than the estimated $88.66 million [4] - Revenue from Technology licensing and other sources was $0.56 million, exceeding the estimated $0.1 million [4] Stock Performance - Over the past month, shares of Opera Limited have returned -4.1%, contrasting with the Zacks S&P 500 composite's +2.5% change [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - The company reported a year-over-year revenue growth of 30%, exceeding the guidance of 22% to 26% and significantly higher than the 17% growth in the same quarter last year [5][17] - Adjusted EBITDA reached $32,000,000, surpassing the high end of previously issued guidance [7] - Operating cash flow was $33,000,000, representing 103% of adjusted EBITDA [19] - Free cash flow from operations was $29,000,000, or 91% of adjusted EBITDA [20] - Adjusted diluted EPS was $0.26 for the quarter [20] Business Line Data and Key Metrics Changes - Advertising revenue grew 44% year-over-year to $93,000,000, with e-commerce being the fastest-growing vertical, increasing over 100% year-over-year [6] - Search revenue returned to double-digit growth, up 11% year-over-year to $50,000,000 [6] - The user base for Opera GX reached 33,000,000 MAUs, an 11% increase year-over-year [12] Market Data and Key Metrics Changes - The company noted strong growth in the Western market, particularly in Europe, which contributed to user acquisition [35] - The e-commerce vertical is expected to continue growing, although comparisons will become more challenging in the second half of the year [71] Company Strategy and Development Direction - The company is focusing on AI integration within its browser, positioning itself as a key player in the emerging AI landscape [9][10] - Opera Neon, an AI browser, is set to be released, combining major AI use cases into a single user interface [10][11] - The company is also expanding its presence in the gaming sector with Opera GX and plans to soft launch in South Korea and Japan [12][63] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of advertising revenue despite macroeconomic volatility [18] - The company anticipates continued growth in search revenue and is optimistic about the broader search landscape evolving with AI [57] - Management acknowledged tariff-related headwinds but noted that global growth has offset these challenges [60][61] Other Important Information - The company has distributed $2.8 in dividends per share since January 2023 and has repurchased 30% of its outstanding stock in the previous three years [21] - MiniPay, a stablecoin wallet, has reached 9,000,000 activated wallets and exceeded 250 million transactions, indicating strong growth potential in the fintech space [15][50] Q&A Session Summary Question: What drove the sequential growth in the Western market user base? - Management indicated that seasonality and marketing strategies played a role, with expectations for more growth in Q3 and Q4 [33] Question: How should we think about the pricing and cost structure of Opera Neon? - Management stated that product marketing is the primary focus, with a combination of advertisement sponsorship and subscription models anticipated for monetization [44] Question: How does MiniPay monetize engagement? - MiniPay is generating revenue through ecosystem partnerships and integrations, leveraging its nature as a fintech product [50] Question: What are the expectations for search revenue growth? - Management expects search revenue to continue performing well, driven by changes in the broader search landscape and user engagement [57] Question: What is the outlook on tariff-related headwinds? - Management noted that while tariffs have created challenges, there is potential for recovery and growth as conditions stabilize [61] Question: How significant is the opportunity in launching Opera GX in South Korea and Japan? - Management sees strong potential in these markets, particularly due to partnerships with popular games like League of Legends [63]

Financial Performance & Guidance - Opera achieved 17 consecutive quarters of Rule of 40 performance, driven by organic growth[11] - The company's 2025 revenue guidance is $591 million, representing a 23% growth[14] - The 2025 adjusted EBITDA guidance is $138 million, with a 23% margin[20, 21] - Q3 2025 revenue guidance is $148 million, representing 20% growth[89] - Since 2020, Opera has returned approximately $477 million to shareholders[16, 17, 98] User Base & Monetization - Opera has approximately 289 million average monthly active users (MAUs) in Q2 2025[12, 13] - Western markets account for 58 million MAUs[13] - ARPU has grown 3.1x over the last 4 years[18, 19] - Advertising accounts for 65% of revenue in Q2 2025, with 44% year-over-year growth[66, 69] - Search accounts for 35% of revenue in Q2 2025, with 11% year-over-year growth[66, 73] Opera GX - Opera GX has 33 million users[45] - Opera GX users represent 8% penetration of web users[52]

Core Insights - Opera Limited reported a 30% year-over-year revenue growth to $143.0 million, exceeding guidance [1][8] - Adjusted EBITDA reached $32.1 million, representing a 22% margin, also surpassing expectations [1][13] - The company raised its full-year revenue guidance to $585 – 597 million with a 23% adjusted EBITDA margin at the midpoints [1][21] Financial Performance - Revenue for the second quarter of 2025 was $143.0 million, a 30% increase from $109.7 million in the same quarter of 2024 [4][8] - Net income decreased by 19% to $15.7 million, with a net income margin of 11% compared to 18% in Q2 2024 [4][13] - Adjusted net income increased by 14% to $23.7 million, with an adjusted net income margin of 17% [4][13] - Adjusted EBITDA rose by 21% to $32.1 million, with a margin of 22% [4][13] Revenue Breakdown - Advertising revenue grew by 44% year-over-year to $92.9 million, accounting for 65% of total revenue [12] - Search revenue increased by 11% year-over-year to $49.6 million, representing 35% of total revenue [12] - The annualized average revenue per user (ARPU) was $1.97, a 35% increase compared to Q2 2024 [12] Operating Expenses - Operating expenses increased by 40% to $124.9 million [9] - Share-based compensation expenses surged by 354% to $8.8 million due to the granting of approximately 1.9 million share-equivalent RSUs [12] - Personnel expenses, excluding share-based compensation, rose by 5% to $18.7 million [12] Cash Flow and Dividends - Net cash flow from operating activities was $33.1 million, representing 103% of adjusted EBITDA [12][14] - Free cash flow from operations was $29.1 million, or 91% of adjusted EBITDA [14] - A dividend of $0.40 per share was announced and paid in July [12] Business Outlook - The company anticipates continued growth in AI-powered intent-based advertising, particularly in e-commerce [2] - Opera expects to maintain momentum in search revenue, contributing to the raised guidance for the year [17]