Slide 1: Opera Software: Fourth quarter 2012
Opera Software: Fourth quarter 2012
Slide 2: 4Q 2012 Financial highlights
4Q 2012 Financial highlights Financial metric 4Q12 4Q11 (MUSD) (MUSD) Revenue Total revenue 60.7 43.5 Profitability Adj. EBITDA*/** 16.9 13.9 EBIT** 13.2 11.3 • Revenue growth of 39% (40% FX adjusted) • Record revenue and strong profits • Strong revenue growth from Mobile Consumers and Mobile Publis
Slide 3: Highlights
Highlights Highlights Operators • Operator Opera Mini user growth 101% YoY Mobile/Devices • 230m+ users of Opera Mobile browser products • Building leading position in the TV/set-top box segment End users • 300m+ people using Opera browsers every month • Mobile Consumer and Mobile Publishers & Adver
Slide 4: Financial review
Financial review
Slide 5: A note from our lawyers
A note from our lawyers DISCLAIMER: This presentation contains, and is i.a. based on, forward-looking statements regarding Opera Software ASA and its subsidiaries. These statements are based on various assumptions made by Opera Software ASA, which are beyond its control and which involve known and u
Slide 6: Financial Highlights
Financial Highlights 3Q 2011 Financial highlights Financial metric 4Q12 4Q11 (MUSD) (MUSD) Revenue Total revenue 60.7 43.5 Profitability Adj. EBITDA*/** 16.9 13.9 EBIT** 13.2 11.3 Cash generation Operating Cash 16.0 14.7 Flow Free Cash Flow*** 10.2 13.4 *Non-IFRS EBITDA excludes stock option costs *
Slide 7: 4Q12 Actuals versus Guidance
4Q12 Actuals versus Guidance 4Q 2012 Actuals 4Q 2012 Midpoint Guidance (October 24)* Revenue MUSD 60.7 MUSD 58.5 EBIT* MUSD 13.2 MUSD 12 *Provided at 3Q12 Presentation
Slide 8: 4Q12 Financial review
4Q12 Financial review MUSD 4Q12* 4Q11 Q on Q Revenue 60.7 43.5 39% Cost of Goods sold- 9.3 1.5 499% Payroll and related expenses - 24.4 19.1 28% Stock option costs - 0.9 0.7 20% Depreciation and amortization - 2.8 1.9 46% Other operating expenses - 10.2 8.9 14% Total expenses = 47.5 32.2 47% EBIT 13
Slide 9: Financial highlights: 4Q11-4Q12
Financial highlights: 4Q11-4Q12 Revenue (MUSD) Adjusted EBITDA* (MUSD) Revenue Adjusted EBITDA* 65 18 60 17 55 16 15 50 14 45 13 12 40 11 35 10 30 9 8 25 7 20 6 5 15 4 10 3 5 2 1 0 0 4Q11 1Q12 2Q12 3Q12 4Q12 4Q11 1Q12 2Q12 3Q12 4Q12 * Non-IFRS EBITDA excludes stock option costs and extraordinary one
Slide 10: Revenue growth drivers
Revenue growth drivers Operators: Users and Usage Mobile Consumers: Users and Usage Desktop: Users and Usage Device OEMs: ConnectedTVs Mobile Publishers & Advertisers: Mobile Advertising Spend from Premium Brands
Slide 11: Opera Market Opportunity
Opera Market Opportunity Opera Network Member Opera Websites Websites/Apps Search, operators and developers Advertisers
Slide 12: Revenue: Customer type (4Q12)
Revenue: Customer type (4Q12) Overall revenue slightly above expectations Customer Type Operators In line with expectations Mobile Consumers – Opera Owned and In line with expectations Operated Properties Mobile OEMs In line with expectations Desktop Consumers In line with expectations Device OEMs I
Slide 13: Revenue: Operators (4Q12)
Revenue: Operators (4Q12) Operator Revenue in line with expectations 101% Operator Opera Mini user growth December 2012 vs. December 2011 User growth driven by Airtel, MTN and Vodafone in particular Opera Mini licence revenue up 16% to MUSD 10.0 Overall revenue growth: Up 6% versus 4Q11, with solid
Slide 14: Revenue: Mobile Consumers – Opera Owned and Operated Properties
Revenue: Mobile Consumers – Opera Owned and Operated Properties (4Q12)) Mobile Consumer revenue in line with expectations Revenue growth driven primarily by mobile search and advertising Revenue growth: 100% versus 4Q11 MUSD Mobile Consumers – Opera Owned and Operated Properties* 10 9 8 7 6 5 9 4 3
Slide 15: Revenue: Mobile OEMs (4Q12)
Revenue: Mobile OEMs (4Q12) Mobile OEM revenue in line with expectations Overall revenue growth: down 89% versus 4Q11 MUSD Mobile OEM revenue* NRE + M&S Licenses 3 2 1 1 1 1 1 1 1 0 0 0 0 0 * Unaudited 4Q11 1Q12 2Q12 3Q12 4Q12
Slide 16: Revenue: Desktop Consumers (4Q12)
Revenue: Desktop Consumers (4Q12) Desktop revenue in line with expectations Strong ARPU due to strong local affiliate and search revenue Desktop users at 55 million, down 4% versus end of 4Q11 Overall revenue growth: 10% versus 4Q11 Monthly Desktop users* (last month of quarter) Desktop revenue* (MU
Slide 17: Revenue: Device OEMs (4Q12)
Revenue: Device OEMs (4Q12) Device OEM revenue in line with expectations Revenue driven by Connected TV customers License revenue: 75%+ of revenue Overall revenue growth: down 2% versus 4Q11 MUSD Device OEM revenue* NRE + M&S Licenses 10 9 8 2 2 7 2 6 3 5 4 7 3 6 2 7 2 4 1 2 0 * Unaudited 4Q11 1Q12
Slide 18: Revenue: Mobile Publishers & Advertisers – Opera Network Members
Revenue: Mobile Publishers & Advertisers – Opera Network Members (4Q12)) Mobile Publisher & Advertiser above expectations Revenue growth driven primarily by premium advertisers AdMarvel managed 140B ad impressions in 4Q12, up 95% vs. 4Q11 Revenue growth: 379% versus 4Q11 MUSD Mobile Publishers & Adv
Slide 19: OPEX development
OPEX development OPEX (NOK Million) One time extraordinary cost Cost line 4Q12 vs. Comments Cost of goods sold 4Q11 Other OPEX Payroll 28% •Higher compensation expense per Depreciation employee and overall headcount Stock Options growth. Payroll Cost of Goods 499% •Driven by 379% growth in Mobile So
Slide 20: Cash flow 4Q12 (MUSD)
Cash flow 4Q12 (MUSD) 25 20 15 10 5 0 -5 -10
Slide 21: FY2012 Perfomance
FY2012 Perfomance Metric 2012 Guidance* 2012 Actual Revenue MUSD 200-215 MUSD 216 EBIT** MUSD 48-53 MUSD 50 Implied Adj MUSD 60-66 MUSD 63 EBITDA*** *Given @ 4Q11 presentation February 2012 **Earnings before interest and taxes, excludes extraordinary/one-time costs and acquisition related costs. ***
Slide 22: Strategic Logic: Acquisition of Skyfire
Strategic Logic: Acquisition of Skyfire 26x Data Growth and Over 70% of • Massive Video/Media optimization market Mobile Traffic Will be Video by 2016 opportunity, expected to be 70% of data traffic in the future • Dramatically expands target market for Opera beyond Opera´s own products • Skyfire is
Slide 23: Overview of Acquisition Terms
Overview Why of Acquisition Opera Mobile Marketplace isTerms Strategic Term Conditions Upfront • USD 50 mm (including assumption of USD 8 mm of cash on Skyfire balance sheet) at closing for 100% of the shares of Skyfire • 76% of consideration in cash and 24% in Opera common stock Performance • USD 0
Slide 24: 1Q13 Guidance
1Q13 Guidance Metric 1Q13 Guidance SkyFire 1Q13 Guidance excluding Including Skyfire Skyfire Revenue* MUSD 60-63 MUSD 0.3 MUSD 60-63 Adj MUSD 17-19 MUSD (1.2) MUSD 16-18 EBITDA*** EBIT** MUSD 13-15 MUSD (1.7) MUSD 11-13 * Assumes currency remainder of 1Q13 (NOK 5.6 /USD, USD 1.35 /EUR) **Earnings be
Slide 25: 1Q13 Guidance
1Q13 Guidance Vs. 4Q12* Comments Revenue Operators Flat/Up Solid Opera Mini license/data revenue Mobile Consumers Up Continued user and ARPU growth Desktop Flat Flat user trend and weaker seasonality Device OEMs Down Seasonally weaker Mobile Publishers & Flat/Down Seasonally weaker Advertisers Expen
Slide 26: FY2013 Outlook
FY2013 Outlook Metric 2013 SkyFire 2013 2013 Guidance Guidance Aspirations excluding Including (from May Skyfire Skyfire 2011 CMD) Revenue* MUSD 268-281 MUSD 12-14 MUSD 280-295 MUSD 245-290 Adj MUSD 80-88 MUSD (4-5) MUSD 76-84 MUSD 76-102 EBITDA*** EBIT** MUSD 63-71 MUSD (9-11) MUSD 52-62 *Assumes c
Slide 27: FY2013 Outlook – Revenues
FY2013 Outlook – Revenues Customer Area* 2012 2013(e) Comments MUSD ** Operators $42 Up Primarily from new services from Opera and Skyfire Mobile Consumers $20 Up User growth and monetization of Opera mobile Consumer users via advertising and search Desktop Consumers $68 Flat Stable user and ARPU ex
Slide 28: FY2013 Outlook - Expenses
FY2013 Outlook - Expenses Capital COGS 2012 MUSD $25 2013 (e)*** Up Comments - 2013 Driven by growth in Mobile Publisher and Advertiser revenue (i.e., publisher payouts) Markets Payroll Stock option costs $91 $4 Up Flat Primarily due to new hires in the mobile advertising business, annual pay increa
Slide 29: Operational review
Operational review
Slide 30: +300 million users
+300 million users
Slide 31: Shifting gears to capture the Smartphone growth
Shifting gears to capture the Smartphone growth • 300 million monthly active users • Staffing up on Smartphones and Desktop • Using WebKit and Chromium code • Innovation on UI and differentiating features • More compatible mobile and tablet browser
Slide 32: From Presto to WebKit
From Presto to WebKit The rendering engine switch allows Opera to focus on key differentiators and end user benefits Innovations Unique features Resources Compression User interface Resources WebKit engine
Slide 33: Consumer browsers 2013
Consumer browsers 2013 Android iOS Desktop
Slide 34: Strategic move in the operator market
Strategic move in the operator market
Slide 35: Strategic acquisition of Skyfire
Strategic acquisition of Skyfire
Slide 36: Operational Update Q4-2012
Operational Update Q4-2012
Slide 37: Mobile Consumers
Mobile Consumers
Slide 38: Growing userbase of 230M+
50 000 000 100 000 000 150 000 000 200 000 000 250 000 000 0 2010 - January 2010 - February 2010 - March 2010 - April 2010 - May 2010 - June 2010 - July 2010 - August 2010 - September 2010 - October 2010 - November 2010 - December 2011 - January Smart Phone 2011 - February 2011 - March 2011 - April
Slide 39: Continued strong growth on Android 250% YoY
Continued strong growth on Android 250% YoY 45 000 000 40 000 000 35 000 000 30 000 000 25 000 000 20 000 000 15 000 000 10 000 000 5 000 000 0
Slide 40: Opera Mini and Opera Mobile near-doubling in Q4-12 Android daily installs
Opera Mini and Opera Mobile near-doubling in Q4- 12 Android daily installs Opera Mini daily installs Opera Mobile daily installs
Slide 41: Smartpage and OMS driving app downloads
Smartpage and OMS driving app downloads - Established Opera Mini and OMS as a channel to drive app downloads - Highest growth areas are the mobile games area within our biggest markets - Growth accelerating as we staff up in key regions and move the management of deals into a marketplace
Slide 42: Desktop Consumers
Desktop Consumers
Slide 43: We work with global and local brand partners
We work with global and local brand partners
Slide 44: Traffic driven from Speed Dial in all major markets
Traffic driven from Opera desktop and first tests on Opera Mobile user bases Pre-installed and optimized Speed Dial in all major markets where Booking.com operates Mutual partnership: Intelligence data sharing in order to enhance performance
Slide 45: Continue to grow revenue
Desktop revenue (MUSD) 18 16 14 12 10 8 17 15 6 4 2 0 4Q11 4Q12 Continue to grow revenue
Slide 46: Faster and cheaper internet browsing
Faster and cheaper internet browsing. O pe rato rs Visit m.opera.com to download.
Slide 47: Continued strong momentum with operators globally
Continued strong momentum with operators globally
Slide 48: Strong growth of Operator users
Operator Users 60 000 000 50 000 000 40 000 000 30 000 000 20 000 000 10 000 000 -00 des-11 jan-12 feb-12 mar-12 apr-12 mai-12 jun-12 jul-12 aug-12 sep-12 okt-12 nov-12 des-12 Strong growth of Operator users
Slide 49: Taking dataplans to the next level
Taking dataplans to the next level
Slide 50: Opera Web Pass
Opera Web Pass Successfully launched during November Good initial results from the Digi deployment Strong pipeline New partner announcements at Packaging the Web differently! MWC in Barcelona
Slide 51: Unlock a broader opportunity
Unlock a broader opportunity
Slide 52: World leading Cloud and Context aware video optimization platform
World leading Cloud and Context aware video optimization platform
Slide 53: Smart extension framework and marketing solutions for mobile operators
Smart extension framework and marketing solutions for mobile operators
Slide 54: Opera “Boost” will be our joint operator platform
Opera “Boost” will be our joint operator platform for device wide optimization and Web Pass on Smartphones Cloud Optimization “Boost” back end Transport Content Optimization Optimization Analytics Service API`s
Slide 55: Video is the main challenge in the networks for the next years
Video is the main challenge in the networks for the next years Video Driving Massive Growth in Mobile Data Today With Skyfire 70% Video by 2016
Slide 56: Users are spending time on both Web and Apps
Users are spending time on both Web and Apps With Skyfire Today
Slide 57: Our New Operator Portfolio
Our New Operator Portfolio A market leading portfolio of cloud solutions for mobility • Further expands the capabilities of Opera's cloud platform for Operators • Compression and optimization support for Video & Multimedia with Rocket Optimizer • Screen presence and monetization opportunity with Hor
Slide 58: Devices OEMs
Devices OEMs
Slide 59: Q4 ‘12 Wins
TV & Devices Q4 ‘12 Wins Opera Devices SDK powers the Boxee TV Changhong chooses Opera Devices SDK
Slide 60: Advertising
Advertising
Slide 61: Update on Mobile Ad Network Strategy
Update on Mobile Ad Network Strategy Mobile Internet, SMS, MMS, Video, Apps Ad Serving Brand Ad Ad network Ad Mediation Publishers Consumer agency Campaign Mgt Demand side Supply side
Slide 62: Q4-2012 confirms a record quarter for Opera in Mobile advertising
Q4-2012 confirms a reccord quarter for Highlights Opera in Mobile advertzing Publishers • 19 of the top 25 media companies use our AdMarvel platform • December 2012 exceeded 50B mobile impressions Advertisers • 70+ of top 100 AdAge Advertisers ran campaigns via Mobile Theory and 4th Screen • Over 50
Slide 63: Campaign Highlights
Campaign Highlights Highlights
Slide 64: Summary
Summary Q4-2012 with significant commercial momentum as our Mobile advertzing business grows Chromium / WebKit based Smartphone product family will launch in Q1-2013 Web Pass success and acquisition of Skyfire takes the Operator offering to the next level
Slide 65: Q&A
Q&A