Slide 1: Opera Software Third quarter 2008
Opera Software Third q quarter 2008
Slide 2: A note from our lawyers
A note from our lawyers 2 This presentation contains and is, i.a., based on forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results
Slide 3: Agenda
3 Agenda 1. Highlights Erik Harrell, Harrell CFO/COO 2. Financial review Erik Harrell, CFO/COO 3. Operational update Business, Consumer Jon S. von Tetzchner, CEO 4. Q&A
Slide 4: Operational highlights
3Q08 financial review 4 Operational highlights Priority Overview Areas eas Operators Operator-branded deals signed with Swisscom and O2 Slovakia Announced T-Mobile as the second operator after KDDI to adopt the Opera Widgets g solution Mobile 58 new phones with Opera pre-installed, including 16 new
Slide 5: 2008 Financial highlights
3Q08 financial review 5 2008 Financial highlights Priorities 3Q status report YTD status report Revenue MNOK 124.7 (+53% vs 3Q07) MNOK 340.2 (+53% vs. 9M07) EBITDA* MNOK 25.9 (MNOK 12.0 in MNOK 62.3 ( vs. MNOK 13.6 9M07) 3Q07) Operating MNOK 44.3 (MNOK - 2.0 in MNOK 80.6 ( vs. MNOK 30.8 9M07) Cash F
Slide 6: Financial Review
Financial Review Q OPERA software
Slide 7: 3Q08 financial review
3Q08 financial review 7 MNOK 3Q 2008 3Q 2007 Q on Q 9M 2008 9M 2007 9M on 9M Desktop + 28.0 17.3 62% 74.4 47.7 56% Internet Devices + 96.7 64.4 50% 265.8 174.7 52% Total revenue = 124.7 81.8 53% 340.2 222.5 53% Payroll and related 73.2 53.9 36% 208.5 156.6 33% expenses - Stock option costs - 1.1 2.3
Slide 8: Key financial figures
3Q08 financial review 8 K fi Key financial i l figures fi Operating revenues (NOK Million) EBITDA* (Non-IFRS) (NOK Million) * Non-IFRS EBITDA excludes stock option cost
Slide 9: Revenues: 3Q08
3Q08 financial review 9 Revenues: 3Q08 Area Comments: Revenues (vs (vs. 3Q07) Business Operators: Strong growth in Opera Mini license revenue, driven by operator active user growth Mobile and Device OEMs: Large increase in revenue from existing and new customers Consumer Opera Desktop*: User growth
Slide 10: OPEX development
3Q08 financial review 10 OPEX development d l t OPEX (NOK Million) OPEX comments 3Q08 vs 3Q07 • Payroll cost up 33% • Headcount growth worldwide of 37% since 3Q07 • Expect headcount to be 620+ end of 4Q08 • Stock option* costs down 52% • Impact of Opera stock price • Expect to be MNOK 2-3 in 4Q08, d
Slide 11: EBITDA development
3Q08 financial review 11 EBITDA d development l t 3Q 2007 / 3Q 2008 (NOK Million) Comments on EBITDA development YoY* Revenues up MNOK 42.9 Desktop + MNOK 10.7 Internet Devices + MNOK 32.2 Payroll and related expenses up MNOK 19.3 Engineering Sales and Marketing globally Overall headcount
Slide 12: Strong capital structure
3Q08 financial review 12 St Strong capital it l structure t t Balance sheet (MNOK) Balance sheet highlights g g 800 Metric 3Q08 3Q07 700 600 Cash and cash equivalents 500 Cash MNOK 509 MNOK 461 400 Current assets 300 NWC* MNOK 37 MNOK 17 200 100 Fixed assets 0 Equity MNOK 571 MNOK 515 30.09.2007 31.
Slide 13: Strong cash flow YTD 2008
3Q08 financial review 13 Strong cash flow YTD 2008 Operating cash flow: MNOK 44.2 in 3Q08 p g cash flow : MNOK 80.6 YTD08 Operating Cash Flow highlights g g 3Q08 3Q07 Operating MNOK 44 2 MNOK -2 cash flow Investments MNOK -4 MNOK -1 Financing* MNOK -24 MNOK 0 Cash balance MNOK 509 MNOK 461 * Opera S
Slide 14: Opera's FY2008 - 2009 financial goals
Goals 2008-2009 14 Opera’s FY2008 - 2009 financial goals Metric Goal 2008 Goal 2009 Revenue Growth comparable to 48%+ 2007 EBITDA* 12%+ 20%+ margin Note: This does NOT constitute financial guidance *Excludes stock option costs
Slide 15: Key strategies to achieve goals
Goals 2008-2009 15 Key strategies to achieve goals Business area Consumer area Continue to focus on top mobile Aggressively grow Opera Desktop and operators and OEMs Opera Mini users in top ten target geographic markets Grow operator-branded Opera Mini active users and win new operators Leverage Ope
Slide 16: Key strategies to achieve goals
Goals 2008-2009 16 Key strategies to achieve goals Business area Consumer area Focus on top customers and Prioritize most strategic features and opportunities functions Continous alignment of engineering Optimize headcount growth and priorities planning p g relative to p projected j demand Constantl
Slide 17: Operations Update
Operations Update
Slide 18: This is Opera Software
18 This is Opera Software The world’s leading Web browser End-user movement: developer company: 579 employees in 21 million unique monthly users of ten countries Opera Mini in October 2008 Unmatched footprint across PCs, mobile Opera Mobile shipped on 120 million phones and other connected devices p
Slide 19: Opera's vision
19 Opera’s vision Opera’s O ’ vision i i iis to provide id the h bbest Internet experience on any device
Slide 20: The vision has become reality
20 Th vision The i i has h become b reality lit
Slide 21: Opera's unique ability to deliver a world-class cross-platform browser
21 Opera’s unique ability to deliver a world- world class cross-platform browser Technical One core – a single, powerful engine Support pp q quickly y evolving g standards Multiple mobile platforms supported Advanced features such as tabs, Opera Zoom, full- page view, AJAX support Organizati
Slide 22: The Opera-powered day
22 The Opera Opera-powered powered day Breakfast: Bus: Work: Boring Airport Recreation: Opera p on Opera p Opera p on meeting: g lounge: g Opera p on laptop Mobile laptop Opera Mini Opera on Wii Archos PMP
Slide 23: There is only one Web
23 There is only one Web Devices, platforms and networks: they come in all shapes and sizes. Only one thing unifies them: The Web
Slide 24: Web as a platform gains momentum
24 Web as a platform gains momentum OEMs and operators are looking to leverage the Web as a platform for mobile applications, UIs, and services OEMs and operators are looking for an open p developerp environment they y can offer across phones On the new KDDI au Box, the Web is a platform for deliver
Slide 25: Proprietary mobile operating systems will drive the Web as the application platform
25 Proprietary mobile operating systems will drive the Web as the application platform 90% of mobile handsets ship with proprietary mobile operating system In 2007 2007, approximately 1 1 billion 1.1 handsets shipped with a proprietary OS while just 100 million shipped with p OS an open Examples of
Slide 26: The unique differentiator: one browser core for any platform powers One Web
26 The unique Th i diff differentiator: ti t one browser b core for any platform powers One Web Motorola Pocket Windows P2K ltron PC Smart Samsung phone Windows SHP CE/Mobile S60 Media Highway Symbian Platform- Pl tf OS independent UIQ core Mac QnX Java Unix J2ME Qte Free (Mini) Qt Linux BSD Solaris
Slide 27: What are operators thinking right now?
What are operators thinking right now? How to How to How to How to How to increase increase promote increase deploy voice SMS MMS Data ARPU Web revenues usage services 1995 2000 2002 2005 2007 2008 Mobile Internet has become a strategic g topic p for operators p
Slide 28: And why they are focused on Web services...
And why they are focused on Web services... Source: Sharma Consulting
Slide 29: Opera at the center of mobile Web growth
29 Opera at the center of mobile Web growth Operators select Opera for mobile Web offerings: ”Opera Mobile Web B Browser Ill Illustrates t t Mobile Internet Growth” Mary Meeker, leading Internet analyst, Morgan Stanley, Nov 5, 2008
Slide 30: Why operators choose Opera Mini
Why operators choose Opera Mini • Instant recognition of Web pages Increase ARPU through frequent data usage • Dynamic user experience ensures that users keep clicking on links • Intuitive and familiar interface to any Attract new customers content,, anyy time,, from anyy mobile Improve customer ret
Slide 31: The power of Widgets and why they're hot among operators and OEMs
31 The power of Widgets and why they’re hot among operators and OEMs Widgets are single-purpose access points to Web content/services They are dynamic Web applications that are connected to the internet but act like native code applications Real p p g people get: Instant access to content One experi
Slide 32: Customer experience: Widgets
32 Customer experience: Widgets 1 2 3 4 Idle screen Widget Widget Widget Widgets Manager Gallery Repository
Slide 33: T-Mobile and Opera take the mobile Web to the next level
33 T-Mobile T Mobile and Opera take the mobile Web to the next level T-Mobile and Opera harness the power of the Web as an application li ti platform l tf The Web gets personal with customizable widgets Front and center: The ultimate Widget experience is making them available on the device idle/home
Slide 34: Widgets repository: generic or customized
34 Widgets repository: generic or customized Generic end-user solution from Opera With customized solution, with 1000s of Widgets available on operators/OEMS can: portal Run Widgets on idle screen Integrate Widgets with native applications such as camera, GPS, contacts, etc G t complete Get l t UI c
Slide 35: Operations Update Business area
Operations Update Business area
Slide 36: O2 rolls out Opera Mini
36 O2 rolls out Opera Mini O2 Telefónica rolled out Opera Mini in Germany and Slovakia thi fall this f ll Opera Mini is pre-installed on a long list of mobile phone models, as well as being available as over-the-air download on other models Opera Mini is O2-branded “O2 customers can forget sluggish
Slide 37: The dynamic duo: Opera Mobile and Opera Mini
37 The dynamic duo: Opera Mobile and Opera Mini Number of phone models with Opera pre-installed pre installed Opera’s presence keeps growing on 200 an ever larger list of mobile phone 180 models 160 New models with Opera Mobile 140 in 3Q: 16 120 118 New models with Opera Mini in 100 59 3Q: 42 80 60
Slide 38: Operators and Opera Mini
38 Operators and Opera Mini Operator-branded: Opera-branded: Cell One (Namibia) (New) GrameenPhone (Bangladesh) Debitel (Germany) Helio (USA) O2 (Slovakia & Germany) HT Telecom (Europe) PTC/era (Poland) mobilkom (Austria) Swisscom (Switzerland) MegaFon (Russia) T-Mobile International Meteor Communic
Slide 39: Opera Mobile: new models in 2008
39 Opera Mobile: new models in 2008 Casio Motorola Sony Ericsson Casio Hitachi W61CA Moto Z10 Sony Ericsson G700 Casio W62CA Moto Z9 Sonyy Ericsson G900 Casio EXILIM Keitai W63CA Moto A810 Sony Ericsson W61SA Motoming A1600 Sony Ericsson re Motorola Q9e Sony Ericsson W64S Hitachi MOTO Q Global Hitac
Slide 40: Opera Mini: new models in 2008
40 Opera Mini: new models in 2008 Samsung Sony Ericsson ASUS Nokia Nokia Sony Ericsson C902i Nokia 6210 Samsung E740 ASUS P552 Nokia N82 Samsung F480 Sony Ericsson K610i Nokia N81 Nokia 6500 classic Sonyy Ericsson K850i N ki 7100 S Nokia Supernova Samsung G600 Fly (India) Nokia N86 Samsung L870 Sony
Slide 41: Opera Devices: pushing boundaries of One Web
41 Opera Devices: pushing boundaries of One Web Two areas of use: Full Internet browsing. Opera Devices SDK used to develop a full- fledged browser for surfing Application environment. Opera Devices SDK powers a device with menu system, y , user interface,, Widgets and applications
Slide 42: Opera Devices – new set-top boxes and gaming device announced
42 Opera Devices – new set set-top top boxes and gaming device announced New gaming device: Nintendo DSi New set-top boxes: KDDI au BOX AirTies AwoX Vestel Alpha Networks AST USEN GyaO NEXT
Slide 43: KDDI au BOX: Merging the worlds of mobile phones and set-top boxes
43 KDDI au BOX: BOX MMerging i ththe worlds ld off mobile bil phones and set-top boxes Download content once, use everywhere Content moves freely between KDDI’s KDDI s auBOX and KDDI’s mobile phone line-up Opera features as the browser on both platforms
Slide 44: Qualcomm and Opera bring Web access to developing markets
44 Qualcomm and Opera bring Web access to developing markets The Kayak™ PC alternative leverages the widespread availability il bilit off 3G tto b bring i IInternet t t connectivity to markets where wired Internet access has often been difficult to access The Opera browser is the central software co
Slide 45: Opera and NVIDIA: transforming the visual mobile experience
45 Opera and NVIDIA: transforming the visual mobile experience A collaboration to bring the full desktop Web- browsing experience, including support for J JavaScript, S i t accelerated l t d vector, t and d video id content, to smartphones and mobile Internet devices NVIDIA will offer an optimized O
Slide 46: Introducing the Nintendo DSi
46 I t d i the Introducing th Nintendo Ni t d DSi Opera p selected for Nintendo’s next-generation portable gaming device,, the hot- selling Nintendo DSi
Slide 47: Devices using Opera
47 KDDI au BOX Sony VGF-CP1 Sony Bravia Video Internet link Nintendo DS Q-matic ticket printer Nintendo Wii Phillips Professional Flat TV Archos 5 & 7 Iwatsu Precot IP Phones Amino Set-top box Kocom Wallpad Telsey Waves VCom NDVB-9000 Tilgin Mood 300 & 400
Slide 48: Operations Update Consumer area
48 Operations p Update p Consumer area
Slide 49: Opera for Desktop: Revenue growth
49 Opera for Desktop: Revenue growth Opera Desktop Revenue (MNOK) Ninth consecutive quarter of growth Revenue growth of 62% compared to 3Q07 Reaping benefits of localization strategy in terms of product features, marketing materials and commercial agreements Higher user growth than overall Internet
Slide 50: Opera Mini: 3Q highlights
50 O Opera Mini: Mi i 3Q highlights hi hli ht Opera Mini monthly page views 21 million monthly users 73.7 million MB of data transferred Value for operators (at NOK 4 per MB): 3 5 billion per year 3.5 Opera Mini now generates data traffic for 500 operators in 150+ countries every month
Slide 51: This time it's personal: introducing Opera Mini 4.2
51 This time it it’s s personal: introducing Opera Mini 4.2 42 What’s hot in Opera p Mini 4.2 Personalized skins New server park in the USA improves speed, performance B tt supportt for Better f video id handling h dli on some models d l Sync your notes in Opera Link Android OS now supported
Slide 52: Growth in key markets with Opera Mini and Opera Desktop
52 Growth in key markets with Opera Mini and Opera Desktop Metric Russia Indonesia Population p 141 000 000 238 000 000 Internet users 33 000 000 25 000 000 Internet te et pe penetration et at o 23.4% 10.5% Opera est. desktop 25% 10% marketshare Opera desktop growth last 112% 115% 12 months Opera Mi
Slide 53: Fast & furious: introducing Opera 9.6 for PCs
53 Fast & furious: introducing Opera 9.6 for PCs Innovation comes in a small package: Increased speed Improved Opera Link Optimized Opera Mail Prioritized e-mail Previewed feeds
Slide 54: My Opera – at the heart of Opera's universe
54 M Opera My O – att th the heart h t off Opera’s O ’ universe i 10 million monthly visitors 1,747 signups per day (average) 1 500 000+ page views per day 1.500,000+
Slide 55: In summary...
55 In summary... summary “Install Opera Mini without hesitation." Wall Street Journal “Thankfully, the [HTC] Touch Diamond comes preloaded l d d with i h Opera O Mobile, M bil so there's h ' a fantastic f i mobile browsing experience” I f ti Week Information W k "I'm already "I' l d willing illi to
Slide 56: Thank you for listening
56 Thank you for listening