Slide 1: Opera Software: Third quarter 2011
Opera Software: Third quarter 2011
Slide 2: 3Q 2011 Financial highlights
3Q 2011 Financial highlights Financial metric 3Q11 3Q10 Status report (MNOK) (MNOK) Revenue Total revenue 222.1 178.3 Profitability Adj. EBITDA*/** 76.2 45.8 EBIT** 62.3 34.8 • Record revenue and profitability • Strong revenue growth from operators, Mobile Consumers & Publishers and Desktop • Contin
Slide 3: Highlights
Highlights Highlights Operators • Strong growth in operator Opera Mini users: 21.5 million in October 2011, vs. 7.5 million in October 2010, up 187% • Strong operator platform for continued growth • Growth from existing customers like Telkomsel, AT&T, Vodafone, MTN and MTS • Vodafone launching Co-br
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 3Q11 3Q10 Status report (MNOK) (MNOK) Revenue Total revenue 222.1 178.3 Profitability Adj. EBITDA*/** 76.2 45.8 EBIT** 62.3 34.8 Cash generation Operating Cash 68.2 -1.6 Flow Free Cash Flow*** 45.5 -5.7 *Non-IFRS EBITDA excludes stoc
Slide 7: 3Q11 Actuals versus Guidance
3Q11 Actuals versus Guidance 3Q 2011 Actuals 3Q 2011 Midpoint 3Q 2011 Actuals at Guidance* Guidance FX Rates (August 24) (August 24)* Revenue MNOK 222.1 MNOK 222 MNOK 222.1 EBIT** NOK 62.3 MNOK 52.5 MNOK 62.3 *Provided at 2Q11 Presentation **Excluding one-off extraordinary costs of 6.2MNOK in 3Q11
Slide 8: 3Q11 Financial review
3Q11 Financial review MNOK 3Q2011* 3Q2010 Q on Q 9M 2011* 9M 2010* 9M vs. 9M Desktop + 73.6 60.3 22% 214.6 171.4 25% Internet Devices + 148.6 118.0 26% 429.7 327.2 31% Total revenue = 222.1 178.3 25% 644.7 498.7 29% Payroll and related 99.2 94.5 5% 318.4 290.0 10% expenses - Stock option costs - 4.7
Slide 9: Financial highlights: 1Q07-3Q11
Financial highlights: 1Q07-3Q11 Operating revenues (NOK Million) Adjusted EBITDA* (NOK Million) Desktop Internet Devices EBITDA* 240 80 220 70 200 180 60 160 50 140 40 120 100 30 80 20 60 10 40 20 0 0 -10 Q210 Q310 Q1 07 Q2 07 Q3 07 Q4 07 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q4 10 Q
Slide 10: Revenue growth drivers
Revenue growth drivers Operators: Users and Usage Desktop: Users and Usage Mobile Consumers and Publishers: Users and Usage Device OEMs: ConnectedTVs
Slide 11: Revenue: Customer type (3Q11)
Revenue: Customer type (3Q11) Overall revenue as expected Customer Type Operator As expected vs. guidance Desktop Slightly better than expected on strong local affiliate and search revenue Device OEM Slightly lower than expected on lower development revenue Mobile OEM As expected vs. guidance Mobile
Slide 12: Revenue: Operators (3Q11)
Revenue: Operators (3Q11) Operator Revenue in line with expectations 194% Operator Opera Mini user growth September 2011 vs. September 2010 User growth driven by Telkomsel, AT&T and MTS in particular ARPU as expected Overall revenue growth: Up 30% versus 3Q10 and down as expected vs. 2Q11 with stron
Slide 13: Revenue: Mobile Consumers & Publishers (3Q11)
Revenue: Mobile Consumers & Publishers (3Q11) Mobile Consumers & Publishers revenue slightly better than expected on solid AdMarvel and Consumer Mobile revenue Revenue growth driven by AdMarvel and the Opera Mobile Store vs. 3Q10 AdMarvel managed 56B+ ad impressions in 3Q11, up 169% vs. 3Q10 Overall
Slide 14: Revenue: Device OEMs (3Q11)
Revenue: Device OEMs (3Q11) Device OEM revenue slightly lower than expected on lower development revenue Revenue driven by Connected TV customers License revenue: 80%+ of revenue Overall revenue growth: 5% versus 3Q10 and up slightly less than expected vs. 2Q11 on lower NRE and M&S MNOK Device OEM r
Slide 15: Revenue: Mobile OEMs (3Q11)
Revenue: Mobile OEMs (3Q11) Mobile OEM revenue in line with expectations License revenue: 65+% of revenue Overall revenue growth: up 3% versus 3Q10 and up as expected vs. 2Q11 due to historically contracted pre-paid shipment commitments MNOK Mobile OEM revenue* NRE + M&S Licenses 30 25 20 8 15 7 22
Slide 16: Revenue type: Internet Devices (3Q11)
Revenue type: Internet Devices (3Q11) Revenue type Comment NRE Down as expected vs. 3Q10 and 2Q11 M&S In line with expectations vs. 3Q10 and 2Q11 Total Opera Mini Opera Mini revenue as expected vs. 2Q11 and up vs. 3Q10, with solid growth in license revenue from operators Revenue 3Q10 4Q10 1Q11 2Q11
Slide 17: Revenue: Desktop (3Q11)
Revenue: Desktop (3Q11) Desktop revenue slightly better than expected on strong local affiliate and search revenue Desktop user growth 20% versus end of 3Q10 Strong ARPU in USD (~7% negative FX impact) Overall revenue growth: 22% versus 3Q10 and slightly better than expected versus 2Q11 Monthly Desk
Slide 18: Revenue: Opera-branded Opera Mini (3Q11)
Revenue: Opera-branded Opera Mini (3Q11) 140 000 000 130 000 000 Monthly users • Growth continuing 120 000 000 • High focus on 110 000 000 converting users 100 000 000 to operator- 90 000 000 branded or co- 80 000 000 branded revenue 70 000 000 generating users 60 000 000 • High priority of 50 000 0
Slide 19: Key user metrics FY2010 - 2011YTD
Key user metrics FY2010 - 2011YTD January April July October January April July October Metric 2010 2010 2010 2010 2011 2011 2011 2011 Operator Opera 2.1* 3.5* 5.2* 7.5* 11.5* 15.0* 16.8* 21.5* Mini Million Million Million Million Million Million Million Million users Opera- branded 50** 59** 62** 7
Slide 20: OPEX development
OPEX development OPEX (NOK Million) Cost line 3Q11 vs. Comments One time extraordinary cost 3Q10 Other OPEX Payroll 5% •Higher compensation expense Depreciation per employee and overall headcount growth. Stock Options Payroll Stock options -7% •Fewer outstanding options 180 •Investments in Opera Min
Slide 21: Adjusted EBITDA development
Adjusted EBITDA* development 3Q 2010 / 3Q 2011 (NOK Million) 120 100 80 60 40 20 0 EBITDA Internet Desktop Currency Total costs Currency EBITDA Q3 2010 Devices Revenue impact impact Q3 2011 revenue revenue costs *Non-IFRS Adjusted EBITDA excludes stock option costs and one-time costs.
Slide 22: Strong capital structure
Strong capital structure Balance sheet highlights: Metric 3Q11 (MNOK) 3Q10 (MNOK) Cash 471 509 Interest-bearing debt 0 0 NWC* 7 -61 Equity 701 629 * NWC is defined as total current assets excluding cash and cash equivalents minus total current liabilities excluding provisions.
Slide 23: Cash flow 3Q11 (MNOK)
Cash flow 3Q11 (MNOK) 100 90 80 70 60 50 40 30 20 10 0
Slide 24: 3Q11 Key KPIs: Summary
3Q11 Key KPIs: Summary Metric 3Q11 3Q10 Change % Revenue (MNOK) 222.1 178.6 25% EBIT (MNOK)**** 62.3 34.8 79% Adjusted EBITDA (MNOK)**** 76.2 45.8 66% Adjusted EBITDA Margin** 34.3% 25.6% 34% Operating Cash Flow (MNOK) 68.2 -1.6 N/A Free Cash Flow (MNOK) 45.5 -5.7 N/A Opera Mini Operator users (mill
Slide 25: 4Q11 Guidance
4Q11 Guidance Metric Current 4Q 2011 Prior 4Q 2011 Current 4Q 2011 Guidance Guidance (August Guidance (USD) 24th) Revenue* MNOK 236-246 MNOK 231-241 MUSD ~43-45 EBIT** MNOK 56-64 MNOK 45-50 MUSD ~10-12 *Assumes currency remainder of 2011 (NOK 5.5 /USD, NOK 7.9/EUR) **Earnings before interest and tax
Slide 26: 4Q11 Guidance
4Q11 Guidance Vs. 3Q11 Comments Revenue* Operators Flat Opera Mini active user and revenue growth, offset by falling customized Opera Mobile revenue Desktop Up Seasonally stronger 4Q Device OEMs Up Much higher due to connected TV customer pre- paid commitments Mobile OEMs Down Down to more normalize
Slide 27: 2011 Guidance
2011 Guidance Metric Current 2011 Prior Current 2011 Guidance 2011 Guidance Guidance USD*** (August 24th) Revenue* MNOK 880-890 MNOK 870-890 MUSD ~160-162 EBIT** MNOK 204-212 MNOK 180-190 *Assumes currency remainder of 2011 (NOK 5.5 /USD, NOK 7.9/EUR). **Earnings before interest and taxes, exclude e
Slide 28: Moving to USD reporting
Moving to USD reporting Opera will move to USD reporting from 1Q12 Opera has >50% of revenues in USD and no revenue in NOK Reduces FX volatility on topline as well as to eps In-line with other global tech companies Opera will provide 4Q11 guidance in USD & NOK Opera converts 2013 aspirations to USD
Slide 29: Operations update
Operations update
Slide 30: 21.5 million operator Opera Mini users
21.5 million operator Opera Mini users Monthly Operator users 25 000 000 20 000 000 15 000 000 10 000 000 5 000 000 0 okt-09 okt-10 okt-11 mar-10 mar-11 feb-10 feb-11 apr-11 sep-09 des-09 apr-10 mai-10 sep-10 des-10 mai-11 sep-11 aug-09 jan-10 jun-10 aug-10 jan-11 jun-11 aug-11 jul-10 jul-11 nov-09
Slide 31: Existing partners rolling out
Existing partners rolling out
Slide 32: MTN Cobranded Opera Mini - roll out plan
MTN Cobranded Opera Mini - roll out plan September October November December Nigeria Syria Guinea Bissau Cameroon Cyprus Guinea Conakry Rwanda Yemen Liberia Afghanistan Congo Botswana Swaziland Sudan Ghana Ivory Coast Benin Uganda Iran Zambia • Launch MTN Co-branded Opera Mini in all 21 MTN markets
Slide 33: Example – Smart Philippines
Local partner marketing activities: Example – Smart Philippines TV advertising Bilboards Social media campaign Radio spots Events
Slide 34: Good user growth for Opera Mini
Good user growth for Opera Mini Active users 160 000 000 140 000 000 120 000 000 100 000 000 80 000 000 60 000 000 40 000 000 20 000 000 0
Slide 35: 1M Opera Mini users in October
From 6 countries in June 2010 to: 20 Countries with more than 1M Opera Mini users in October
Slide 36: Oupeng roll-out in China
Oupeng roll-out in China • Solid user growth, first 1.4M users reached in October • 40%+ Android users
Slide 37: Oupeng - Most popular features
Oupeng - Most popular features • Microblogging service tailored for the Chinese market • Unlimited speed dials • Tons of pre-installed links/resources
Slide 38: Accelerating user growth on Android
Accelerating user growth on Android •9.4 million monthly Opera-users on Android in October •Supreme rating in Android Market •On target to reach significant marketshare, currently @ ~5%
Slide 39: Ongoing Android push = increased visibility
Ongoing Android push = increased visibility
Slide 40: and opera.com
every platform, every OEM, every store, online ads and opera.com
Slide 41: 220+ million people use Opera
220+ million people use Opera
Slide 42: TV update
TV update
Slide 43: Opera’s Connected TV footprint
Opera’s Connected TV footprint Connected TVs BluRay Players STBs Silicon Vendors + 15 more OEMs • Opera will aim to deliver its TV Store and stand alone apps to all SDK customers • Total market size in excess of 30 Million units in 2011, 50 Million units in 2012 • Same HTML 5 Opera core rendering en
Slide 44: Opera TV store launched
My apps NEW AND NOTEWORTHY THIS MONTH facebook. FEATURED & NEW APPS All Categories Education Games Health & Fitness TV Store chess Lo} Opera TV store launched
Slide 45: Desktop update
Desktop update
Slide 46: Opera for desktop: Continued revenue and user growth
Opera for desktop: Continued revenue and user growth • Continued revenue growth Desktop revenue* (MNOK) • 73.6 MNOK: increase of 80 22% compared to 3Q10 70 • FX impacted revenue 60 negatively with USD down 7% in 3Q11 vs. 3Q10 50 • Continued user growth 40 74 71 71 70 30 60 • 54 million Opera desktop
Slide 47: Yandex = +1M users in 2011
Yandex = +1M users in 2011 Example: Strong partners can drive distribution
Slide 48: Around 50 new content partners added to the Opera Browser in 2011
Around 50 new content partners have been added to the Opera Browser in 2011 Multi-regional: Bing, Booking.com, Bigpoint, Opera Sports, Alawar, Games2Win, Hotels.com, TradeDoubler Ukraine: Sinoptik, Aukro, Emarket.ua, Vsene, Ukr.net Russia: Nikita, Mamba, Skyscanner, Groupon, Drom, Lamoda, gazeta.ru
Slide 49: Content providers – Speed Dial monetization
Content providers – Speed Dial monetization
Slide 50: Released alpha-version of Opera 12
Released alpha-version of Opera 12 • Showcasing Hardware acceleration and WebGL • Webcam API • New HTML5 engine • New address bar • Opera themes support • Demoed with Angry Birds
Slide 51: Service Components
• Advertising • Opera Mobile Store • Content partnerships & Service Speed Dials slots Components • Ad Exchange • Publishers • Payment Exchange
Slide 52: Q&A
Q&A