Opera Limited (NASDAQ:OPRA) Q3 2023 Earnings Call Transcript

Frode Jacobsen: Hey Lance. Yes, so at least in our investor presentation, I’m not sure if it’s updated online yet, but you’ll see the updated that. So, for now, Western users represent 16% of the user base, up from 15% in the prior quarter. It’s not such an excellent stat just because it typically moves with decimals. And then every couple of quarters, maybe we’ve been adding a point, but it is up relative to the Q2 average. And I think you’ll also see in the timeline. So, I think we the number of users over time. And this year is unlike the past many years, we had a growth also from Q3 to Q4 were normally because of seasonality, Q3 relative to Q2 is quite flat.

Lance Vitanza: I mean is the way to think about that, though, I mean, 15%, 16%, regardless, those don’t sound like big numbers. Does that suggest that there’s a lot of headroom there for continued growth? I mean do you see — is the target to get to, I don’t know, 30%, 70%, that kind of a split? Or where should we be thinking this kind of go over time?

Frode Jacobsen: We don’t really have a very defined ceiling just because we still have the perception that we remain still a quite small company. We talked a bit about the sizing for Opera GX as well. So — but looking ahead and also looking past — for the past couple of years, our strategy is to keep growing in Western markets. We continue to have very good momentum on that and to grow high-value users broadly, such as gamers, for example.

Lance Vitanza: Okay. On the marketing spend, my question on marketing spend, do lower than expected, a little bit lower than our estimate. And just to what extent was that perhaps driven by timing and maybe a decision to just sort of push some of the marketing spend from 3Q into 4Q? Is there any of that that we should be thinking about? I mean I know you mentioned that you’re going to be a little bit over $30 million in the fourth quarter. I’m just wondering if that’s a result of maybe some investments that got pushed.

Frode Jacobsen: No, it’s not really a timing item when you look at the implicit marketing guidance for the next quarter, it’s the same to a bit down relative to what we had in our prior implicit Q4 guidance.

Lance Vitanza: Okay. Great. And then last for me, you talked about the stronger than expected acceleration within the quarter as you go month-to-months in this past quarter. And I’m just wondering, clearly, it sounds like products and technology at Opera had a lot to do with that. But was there perhaps also some improvement in the overall advertising backdrop that helped you that was improving throughout the quarter as well? Or maybe the way to phrase it is, is the macro backdrop helping or hurting you these days and which direction do you see that going?

Frode Jacobsen: I mean starting with the FX headwind that’s worked against us for some time, just due to the strength of the US dollar. I think we saw the headwind decline a little bit now, let’s say, only 5 percentage points in the quarter, but it remains a headwind given our very global exposure, for the ad market in particular. Song, I don’t know if you want to comment on that?

Lin Song: Yes, I will try. But Lance, I’m sorry, it’s my strategy is not telling anyone. So — but I would say, I think in general, we see a good recovery of travel, which is of our team feel free and our account is very strong, then people like at makes have also benefited from that, especially also during the summer time, right, what’s coming in Q3. I think we also see a fair e-commerce towards the end of Q3 [Indiscernible] past Q4. It’s also going to be okay. So I think that’s noticeable one we see. I think the rest are more like as they expected.

Lance Vitanza: Great. Thanks, guys. I appreciate the help.

Operator: [Operator Instructions] We’ll take our next question from Alicia Yap with Citigroup. Your line is open.