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    Opera Ltd (OPRA)

    Q1 2025 Earnings Summary

    Reported on Apr 29, 2025 (Before Market Open)
    Pre-Earnings Price$16.84Open (Apr 28, 2025)
    Post-Earnings Price$16.84Open (Apr 28, 2025)
    Price Change
    $0.00(0.00%)
    • E-commerce expansion: The e-commerce vertical is growing at over 100% year-over-year, nearly matching the significance of search revenue. This high-growth area, particularly with untapped opportunities in the U.S., provides a strong structural tailwind for future revenue expansion.
    • Resilient performance-based advertising model: With nearly all advertising revenue tied to measurable performance, the company benefits from a model that is less vulnerable to macroeconomic volatility, bolstering its revenue resilience.
    • Global diversification with a focus on high ARPU segments: The company leverages a diversified geographic footprint—including strong growth in markets like Southeast Asia, Japan, and LATAM—while focusing on high-value users, driving substantial year-over-year ARPU improvements.
    • Seasonality Risk: Although Q1 demonstrated strong outperformance driven by e-commerce, executives noted that once the e-commerce vertical matures, typical seasonal patterns could reemerge, potentially dampening future quarterly revenue growth.
    • Currency Headwinds: Management mentioned that the strong U.S. dollar acted as a headwind—reducing reported growth by an estimated 5–6 percentage points on a constant currency basis—which could persist and impact profitability.
    • Regulatory and Geopolitical Uncertainties: Ongoing discussions around U.S. antitrust actions and broader political and trade tensions introduce uncertainty that may adversely affect both the browser business and ad tech revenue streams.
    MetricPeriodPrevious GuidanceCurrent GuidanceChange

    Revenue (Quarterly)

    Q2 2025

    no prior guidance

    $134M to $138M; 24% growth

    no prior guidance

    Adjusted EBITDA (Quarterly)

    Q2 2025

    no prior guidance

    $30M to $32M; 23% margin

    no prior guidance

    OpEx Pre-Adjusted EBITDA (Quarterly)

    Q2 2025

    no prior guidance

    $105M at the midpoint

    no prior guidance

    Cost of Revenue Items (Quarterly)

    Q2 2025

    no prior guidance

    Expected in the low 30% range of revenue

    no prior guidance

    Marketing Costs (Quarterly)

    Q2 2025

    no prior guidance

    Mid- to low $30M range

    no prior guidance

    Cash Compensation Costs (Quarterly)

    Q2 2025

    no prior guidance

    Increase by $1M to $2M vs Q1 2025

    no prior guidance

    Other OpEx Items Pre-Adjusted EBITDA (Quarterly)

    Q2 2025

    no prior guidance

    Expected to remain stable

    no prior guidance

    Revenue (Annual)

    FY 2025

    $555M to $570M; 17% YoY growth

    $567M to $582M; 20% annual growth

    raised

    Adjusted EBITDA (Annual)

    FY 2025

    $132M to $138M; 24% margin

    $135M to $140M; 24% margin

    raised

    OpEx Pre-Adjusted EBITDA (Annual)

    FY 2025

    no prior guidance

    $437M at the midpoint

    no prior guidance

    Cost of Revenue Items (Annual)

    FY 2025

    Expected to reach about 30% of revenue

    Expected to be 32% to 33% of revenue

    raised

    Marketing Costs (Annual)

    FY 2025

    Expected to grow at a low-teens percentage YoY

    Expected to grow at a high single-digit percentage YoY

    lowered

    Cash Compensation & Other OpEx Items (Annual)

    FY 2025

    Expected to grow at mid-to-high single-digit percentage rates YoY

    Expected to grow at mid- to high single-digit percentage rates YoY

    no change

    1. E-commerce Growth
      Q: E-commerce exposure details?
      A: Management highlighted that e-commerce is scaling at over 100% YoY, now forming a vital part of ad revenue with strong global and U.S. growth prospects.

    2. US E-commerce
      Q: How to grow US e-commerce?
      A: They emphasized targeting performance-focused major retailers to unlock the vast U.S. opportunity, with plans to expand both domestically and internationally.

    3. US Ad Environment
      Q: Is the US ad market favorable?
      A: Lin Song noted that in volatile conditions, performance-based advertising is more attractive, enhancing Opera’s competitive edge in the U.S. market.

    4. Search Advertising
      Q: What drives search ad growth?
      A: Management explained that intent-based targeting is enabling additional ad formats beyond traditional search, supporting steady, modest double-digit gains.

    5. Currency Impact
      Q: Does currency affect GX revenue?
      A: Frode indicated that a strong U.S. dollar has been a headwind, reducing growth by approximately 5–6% on a constant currency basis, though sequential impacts remain muted.

    6. Marketing Strategy
      Q: Any marketing channel reallocations?
      A: They reported that a Q4 spike due to product launches gave way to a steadier focus on online, click-based campaigns in Q1 while core brand efforts stayed steady.

    7. User Base Focus
      Q: Should we worry about MAU decline?
      A: Frode emphasized focusing on high-value users and increased ARPU rather than total MAUs, making the lower overall count less concerning.

    8. E-commerce Seasonality
      Q: Will mature e-commerce revert seasonally?
      A: Both executives agreed that while natural seasonality exists, the current rapid growth has muted these effects, though it may resume as the market matures.

    9. Antitrust Effects
      Q: Impact of antitrust on Opera?
      A: Lin Song remarked that regulatory shifts promoting competition ultimately benefit Opera by spurring innovation and validating its performance-based advertising model.