Opera Q2 2025 Earnings Call Transcript

Quartr
Provided by Quartr
August 19, 2025

Key Takeaways

  • Positive Sentiment: Revenue grew 30% year-over-year in Q2, well above guidance and marking the 17th straight quarter of organic growth.
  • Positive Sentiment: Advertising revenue surged 44% to $93M, led by e-commerce ads growing over 100% and search returning to double-digit growth.
  • Positive Sentiment: Opera raised its full-year 2025 revenue guidance to $585M–$597M (22–24% growth) and lifted the bottom end of its adjusted EBITDA range.
  • Neutral Sentiment: Opera plans to launch Opera Neon this fall, an AI-powered browser aiming to natively integrate AI agents for enhanced productivity.
  • Neutral Sentiment: MiniPay stablecoin wallet reached 9M wallets and 250M transactions, indicating potential in fintech and cross-border payment services.
AI Generated. May Contain Errors.
Earnings Conference Call
Opera Q2 2025
00:00 / 00:00

Transcript Sections

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Operator

Welcome to the Opera Limited Second Quarter twenty twenty five Earnings Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. To ask a question during this period, you will need to press star one on your telephone keypad. If you want to remove yourself from the queue, please press star 2.

Operator

Please be advised that today's call is being recorded. I would now like to turn the call over to your speaker today, Matt Wolfson, Head of Investor Relations. Please begin.

Matthew Wolfson
Matthew Wolfson
VP - IR at Opera

Thank you for joining us. This morning, I am joined by our Co CEO, Song Lin and our CFO, Frode Jacobsen. Before I hand over the call to Song Lin, I would like to remind you that some of the statements that we make today regarding our business, operations and financial performance may be considered forward looking. Such statements are based on current expectations and assumptions that are subject to a number of risks and uncertainties. Actual results could differ materially.

Matthew Wolfson
Matthew Wolfson
VP - IR at Opera

Please refer to the Safe Harbor statement in our earnings press release as well as our annual report Form 20 F, including the risk factors. We undertake no obligation to update any forward looking statements. During this call, we will present both IFRS and non IFRS financial measures. A reconciliation of non IFRS to IFRS measures is included in today's earnings press release, which is distributed and available to the public through our Investor Relations website located at investor.opera.com. Our comments will be on year over year comparisons unless we state otherwise.

Matthew Wolfson
Matthew Wolfson
VP - IR at Opera

And with that, let me turn the call over to our Co CEO, Song Lin, who will cover our second quarter operational highlights and strategy and then Frode Jacobson, who will discuss our financials and expectations going forward. Song?

Lin Song
Lin Song
Co-CEO & Director at Opera

Thank you, Matt, and everyone else for joining us today. We have been looking forward to sharing our second quarter results with you and also update you on our latest thinking and priorities in this very exciting business landscape. I am going to start with the financials. The second quarter experienced year over year revenue growth of 30% compared to guidance of 22% to 26% and well ahead of 17% growth in the second quarter of last year. This marks our seventeenth straight quarter as a role for the company, entirely fueled by organic revenue growth and healthy margins, leading to cash flows that fund both innovation and our recurring dividends.

Lin Song
Lin Song
Co-CEO & Director at Opera

Advertising revenue grew 44% year over year to $93,000,000 E commerce remains the fastest growing vertical within advertising, continuing to grow over 100% year over year despite the ongoing volatility due to tariff uncertainty. While the growth spurred from e commerce in our revenue mix has resulted in the vertical now representing nearly half of total advertising revenue, we still believe we are under indexing with ample headroom for continued expansion as we move into the retail heavy back half of the year. We are also very pleased to see search revenue returning to double digit growth, up 11% year over year to $50,000,000 in the quarter. The sequential growth of 6% was also twice as high as it was in Q2 last year, benefiting from the continued mix shift of our user base towards higher app ranges. We also see a broader trend with a new focus on high user internal traffic powered by AI leading to monetization opportunities arising not only during actual search, but also around pre and post search, providing ample opportunities for those in a position to detect and create value.

Lin Song
Lin Song
Co-CEO & Director at Opera

This allows us to deepen cooperation in a space with a wider range of partners from traditional search providers to e commerce, travel and gaming verticals, foremost in The US, though increasingly also a global trend with exciting new opportunities ahead. This strong revenue performance leads to adjusted EBITDA of $32,000,000 just above the high end of our previously issued guidance, and once again, demonstrating that we can outperform our revenue expectations while hitting our profit targets. With that, I'll move to product and our strategic opportunities. We are at the dawn of a new era in compute and surrounded by AI companies competing for users to their models. Beyond being a huge source of traffic, we believe that the browser will emerge as the operating system for these AI services.

Lin Song
Lin Song
Co-CEO & Director at Opera

Today, the majority of AI agents run as cloud hosted web pages. That is clearly inferior to the potential of a browser native architecture, which elevates an agent's capabilities by allowing local native operations to run side by side ways and sometimes indistinguishable from regular human operations. This is the key for AI agent to be truly and consistently helpful, enabling faster execution, richer contextual understanding, and the broader functional extensibility, and also better solution for information privilege. The browser AI agent can have access to all the information accessible by the user, whether it's local files, communication platforms, or premium subscription content with greater control of privacy and security and more efficient use of computing resources. In this context, we are so excited about what we are building for public release during the fall, the AI browser Opera Neon.

Lin Song
Lin Song
Co-CEO & Director at Opera

Neon will combine major AI use cases into a single user interface with the native functionality over Opera browser that is already appreciated for productivity. Opera Neon is built to be the gateway to AI, where web applications and automation converge. The value creation opportunity is huge. For example, there are over 1,000,000,000 knowledge workers worldwide who rely on the browser as their primary workspace. These same workers, on average, juggle night productivity apps a day and a far greater number of web tabs, all in all losing forty minutes to context switching every day.

Lin Song
Lin Song
Co-CEO & Director at Opera

This creates an opportunity for an agent AI collaborator as a natural evolution of how people work based on existing user habits and muscle memory. Opera is uniquely positioned for this, both in terms of competence and scale. We have been pioneering browser innovation for the past thirty years, and we operate at a scale far greater than most web based AI platforms with our nearly 300,000,000 users. We will make AI widely accessible, naturally integrated, and with immediate productivity benefits for our users. Automation and task intelligence will be built right into the routines that already exist.

Lin Song
Lin Song
Co-CEO & Director at Opera

We can't wait to show you. Moving on from AI, I wanted to give you an update on Opera GX, the browser made for gamers. The GX user base was 33,000,000 MAUs in the second quarter, up 11% year over year and with an annualized ARPU of $3.47 Opera GX released an update during the quarter providing users with a pack of in house task management capabilities and improved multitasking features. The update allows for side by side tab viewing, easy tracing of recently visited pages, and the function to organize related tabs into collapsible groups. We are also in the process of soft launching Opera GX in South Korea, with Japan to follow shortly, leveraging our partnership with League of Legends as the preferred browsers.

Lin Song
Lin Song
Co-CEO & Director at Opera

There's not going on with our flagship browsers as well, both for computers and for phones. Though in the interest of time, I'll dive deeper into those on our Q3 call later in the year, since that will coincide with up and coming rollout of the solid edition of Opera one with even more new exciting features. In terms of our overall user base and economics, our strategy of focusing our products and marketing on the highest value segments is unchanged, resulting in solid 5% up growth to an annualized level of 1.97 with $289,000,000 MAUs in the quarter. I will wrap up with the final topic, stablecoins. We view the stablecoin market as one of the most exciting aspects within the fintech space.

Lin Song
Lin Song
Co-CEO & Director at Opera

Through the use of non cash folded wallets, Opera created a stablecoin based wallet called MiniPay. MiniPay allows people to hold, send, and receive funds instantly using just a phone number. MiniPay already works with over 40 different currencies in 53 countries and allow its users to seamlessly convert local cash into a stablecoin backed wallet using their preferred method, card, Apple Pay, mobile money, or bank transfer, and to switch back just as easily. A person located in Europe or The US can then easily send funds or even make an instant payment of groceries and a checkout thousands of miles away. Mini Pay also introduced the notion of pockets, which allows for switching between stable points with just one click.

Lin Song
Lin Song
Co-CEO & Director at Opera

With several real world applications already, MiniPay has the potential to improve the lives of millions of people globally. By simplifying the experience, we removed some major barriers for people to take advantage of this technology. As a result, MiniPay has reached 9,000,000 activated wallets and exceeded two fifty million transactions and is now among the fastest growing non custodial wallets globally. In addition, we are seeing the development of third party apps within MiniPay further differentiating the app and creating a positive feedback loop to fuel additional growth. While our near term priority is skill building, we already generated Mini Pay revenue from integrations that ensure native support for ecosystem partners.

Lin Song
Lin Song
Co-CEO & Director at Opera

MiniPlay was already launched within our lightweight Opera Mini Browser on Android phones and is now also available as a standalone app on both Android and iOS, providing an even richer feature set and sets the stage for transacting across continents without expensive remittance fees. We have observed positive regulatory developments in the stablecoin space, most recently the Genius Act in The United States, and believe we can capture additional growth as this space continues to mature. All in all, we find ourselves in the privileged position of both being able to rapidly scale revenue opportunities, while also being well situated to capitalize on two transformative and highly strategic technologies, AI and the adoption of Stablecoins as a way to drive financial inclusion. We will stay very close to capture these opportunities and we look forward to keeping you posted on these developments. Frode will now dive into the details behind our financial results before providing our updated guidance for the remainder of 2025. Frode?

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

Thanks, Tom. First of all, we are very pleased to yet again deliver on high expectations and exceed both our own guidance as well as Street's expectations. Revenue growth was 30% year over year, well ahead of our already strong guidance of 22% to 26% growth. Looking at the first half as a whole, we grew revenue 35% year over year, which is more than double the year over year growth in the 2024.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

Over the past year, our advertising revenue has scaled to new levels. Preparing for and then seizing e commerce opportunities, we saw major growth acceleration in the second half of last year, followed by an unprecedented sequential growth from the seasonal peak of Q4 into Q1 twenty twenty five. And with Q2, we saw the expansion of global opportunities, largely offsetting the impact of tariff related headwinds in U. S. E commerce.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

We have been positively assured by the resilience of our newly scaled advertising revenue streams in an otherwise volatile macro picture. We also saw search revenue return to double digit growth as expected, which adds to our ability today to significantly raise our growth expectations for the year. On the cost side, Q2 OpEx came in according to our prior directional commentary across marketing, compensation, and the other smaller items combined, while cost of revenue scaled with the revenue over performance and came in at the same percentage of revenue as in Q1. This means that we were able to grow faster than expected and strengthen our overall business trajectory going into the second half of the year, while still exceeding the high end of our adjusted EBITDA guidance. Our operating cash flow was $33,000,000 in the quarter, representing 103% of adjusted EBITDA with the cash flow headwinds of Q1 representing tailwinds in Q2.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

Free cash flow from operations came in at 29,000,000 or 91% of adjusted EBITDA. As always, we continue to expect fluctuations in cash conversion on a quarterly basis with the year to date conversion stabilizing as the year progresses. Adjusted diluted EPS was $0.26 in the quarter. We present adjusted net income and adjusted diluted EPS to provide a consistent view on the underlying business performance, excluding accounting impacts from investments such as OPay and share based compensation expenses, which is quite volatile in the P and L due to timing of grants. While the number of actual equity instruments vested each year has been fairly stable.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

This cost adjustment also eliminates the accounting impact of equity grants made by our majority shareholder consisting of options in that shareholder itself and not causing dilution for OPERA's other shareholders. The resulting adjusted diluted EPS thereby becomes a less volatile metric tied to the underlying profitability of our operations. As Anh mentioned, the second quarter was our seventeenth consecutive quarter as a rule of 40 company with revenue and adjusted EBITDA once again meeting or exceeding our previously issued guidance. We are incredibly happy to continue to execute at these levels of revenue growth matched by healthy profits, us to continue to return cash to shareholders through our recurring dividend program. Since January 2023, we have distributed $2.8 of dividends per share.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

And during the three years prior to that, we bought back 30% of our outstanding stock as another way of driving value for our shareholders. Now, turning to guidance. For 2025 as a whole, we now guide revenue of $5.85 to $597,000,000 or 22 to 24% growth over 2024. This is the second time we refresh 2025 guidance and the second time we add three percentage points to the annual growth rates. Our guidance implies a continued acceleration of our full year revenue growth from 20% in 2023, 21% in 2024, and now 23% at the midpoint for 2025, while continuing to reflect appropriate caution for potential headwinds.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

Similar to before, given the hockey stick growth of the 2024, we have based our guidance on sequential modeling. The raised estimates capture the Q2 overperformance and the increased confidence in our path for the second half. As before, this results in a relatively stable trend of quarterly revenue growth measured on a two year CAGR, which captures the scale we have built in recent quarters, while also evening out our forward looking growth profile. In terms of adjusted EBITDA, we lift the bottom end of the range for now, guiding 136,000,000 to $140,000,000 for the year as a whole, or a margin of 23.4% at the midpoints. This reflects a continued expectation for margin expansion in the second half of the year, but also the weakened U.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

S. Dollar relative to other currencies eats up about a third of the benefit by affecting our cost base. The conversion of international currencies to USD results in a percentage cost increase, most notably for compensation costs, which increases by about a million per quarter in U. S. Dollars compared to the rates from when we last gave guidance.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

Apart from such fluctuations, economies of scale continue to benefit us as an underlying trend. Cost wise, we then implicitly guide to a full year OpEx base pre adjusted EBITDA of $453,000,000 at the midpoints. For the year as a whole, we expect the cost of revenue items combined to come in at 34 percent to 35% of revenue, following the continued growth of APRA ads. Other cost items grow at a lower pace than our revenue and thereby reduce as a percentage of revenue relative to 2024. This includes marketing costs, which we expect to grow at mid to high single digits, compensation costs, which will increase about 10%, and the sum of all other OpEx items, pre adjusted EBITDA, will likely increase at a low single digit percentage.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

In line with this, we guide Q3 revenue of $146,000,000 to $149,000,000 representing 20% growth at the midpoint and Q2 adjusted EBITDA of $34,000,000 to $36,000,000 or a 24% margin at the midpoint. Within the implied quarterly OpEx base of $112,500,000 at the midpoint, we expect that cost of revenue items as percentage of revenue will be 34% to 35% in the quarter. We expect marketing costs in the mid $30,000,000 range and thereby relatively stable versus the prior quarters this year. And we expect cash compensation costs to increase about 1,000,000 to $2,000,000 versus the Q2 level, including the effects of a weaker US dollar relative to the main currencies of our salary expense. The sum of all other OpEx items pre adjusted EBITDA are expected to tick up slightly.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

Giving guidance in these periods that combine such rapid revenue growth in an environment with great changes, both on the macroeconomic stage as well as the technological one has proven to be difficult. Though, we believe caution has served us well. After all, the guidances that later turn out to be conservative were well beyond expectations at the time they were given. And yet again, I believe we have guided something that we should all feel proud and pleased to achieve while recognizing that volatility goes both ways. And we of course hope to continue giving those positive surprises.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

With that, I'll turn the call back to the operator for questions.

Operator

Thank you. As a reminder, to ask a question, please press star one on your telephone keypad. We'll take our first question from Naved Khan with B. Riley Securities. Please go ahead.

Naved Khan
Naved Khan
Managing Director at B. Riley Securities

Great. Thank you very much. Two questions from me, please. One on the Western market user base, the sequential growth was quite strong. Think the strongest we've seen in some time.

Naved Khan
Naved Khan
Managing Director at B. Riley Securities

And on the flip side, GX users didn't really grow. So is this a reflection of how you spend your marketing spend to understand the dynamics there in terms of what drove the strength in western market users versus ZX? And the second question I have is just around Neon. Can you just maybe share some thoughts on how should we think about the pricing of the product and also the cost side of things as you would probably have to pay for the compute for it? Thank you.

Lin Song
Lin Song
Co-CEO & Director at Opera

Yeah, so it's Tony here. I think I'll just quickly comment, right? So maybe super high level, I would just say that I think there is a bit of an additive around it, just to call out, right? Because of course, naturally, GX, you love the mostly younger audiences and also gamers. Young gamers and Gen Zs or whatever, so they are, of course, affected more always, like we saw this all the time that they are affected more by the summer of this.

Lin Song
Lin Song
Co-CEO & Director at Opera

So there is a bit of seasonality factor involved. And yeah, hopefully, will be more changed during the Q3 and Q4. So I think that will be more visible. And then just to also say that, of course, internally, we don't really operate on a basis of more like I would almost say that the growth of investing. The base, of course, is more like summary of indicative trends, right?

Lin Song
Lin Song
Co-CEO & Director at Opera

But internally, of course, we're always organized by our lives, and where we see the biggest potential, then we'll we see the product has been received a lot. And maybe I'll just call out that yeah, so like we see that have very good growth on Europe, for instance, Q2, which is very exciting, which is actually also good proof that by having more of those AIs, actually it would also be helpful to us. It's just because then, especially in the western market, I'm more exposed to be aware that there is actually a choice of browser. So not only default, there will be multiple choices. And that in turn actually help driven adoptions.

Lin Song
Lin Song
Co-CEO & Director at Opera

So we actually see that where AI is contested, actually where it's almost becoming easier for us to acquire users. Yeah, as a simple way to put it.

Operator

We'll take our next question from Eric Sheridan with Goldman Sachs. Please go ahead.

Eric Sheridan
Eric Sheridan
Managing Director at Goldman Sachs

Thanks for taking the question. Maybe a two parter on Neon with the announcement in the release and getting closer to a public launch there. I wanted to go a little bit deeper first, big picture on how you think the browser environment is going to change more broadly. This clearly is a first step towards the direction of sort of AI generation in browsers and how you think about the multiyear pathway for the browser landscape generally changing and how you align the platform for those changes? And then the second piece would just be in terms of launching something like this in the public, how should we think about the investments needed either on the marketing side or on the infrastructure side?

Eric Sheridan
Eric Sheridan
Managing Director at Goldman Sachs

I know David asked about sort of the cost of compute tied to it, but just trying to understand a little bit of sort of fixed versus variable investments behind this over a longer duration period of time. Thanks so much.

Lin Song
Lin Song
Co-CEO & Director at Opera

Sure. So, I guess I'll also take the chance to also come on the question which you have not answered in the first one. So, about NEON and also in general landscape, right? So, I guess, first of all, just to call out that it's, of course, the early stage. And I would say, at this point, our focus primarily is actually on product marketing side of things, right?

Lin Song
Lin Song
Co-CEO & Director at Opera

Because more like but maybe I'll just first talk about how we think of product and also the browser, whatever, right? So a few points, high level, I think that with AI, it's already been proven that web interface via traditional apps, I guess, have now also been recognized as almost the preferred platform where people want active information. And this is especially obvious with AI, right? Because I guess, at least it shows that the web, traditional web, instead of locking apps, are still the best way for AI to be able to operate and to access information freely. So that is very good news for browser in general.

Lin Song
Lin Song
Co-CEO & Director at Opera

So that is, of course, very strong alternatives. If we compare it to some audio narratives a few years back, where somebody is still talking about always on the app or whatever. So I think with AI, that's actually a big help that everybody is now seeing very clearly that web and browser is probably in the future. And then, I guess, I'll also comment that, as also you probably also see the trend lately, also by those AI players, right? All of them are also talking about how important browser could be.

Lin Song
Lin Song
Co-CEO & Director at Opera

So I think our view is about the same, right? That when web becomes so important, there will always be, I would say, two ways of access information. So one way is, well, traditionally, user access information, which is by you run a web page service provided by the AI provider, you run chativity, whatever, on the web page. However, I think it's also been very clear that when we see things go deeper, it's more and more likely that you need a native solution, rather than just because there will be so many information. And as also AI goes on, I think, number one, it will be a separable part of your everyday operation, right?

Lin Song
Lin Song
Co-CEO & Director at Opera

So I think once you try it, you will never be go back. You will always, every day, use AI. But then the second question comes that when you are using AI, it's unlikely that you will have to rely on purely cloud based solutions just because AI have to access everything, right? On your computers, they have access on your premium content, on your subscription, on your email. And all those, I think, will be very hard to capture if only it can access more from cloud as it is now, right?

Lin Song
Lin Song
Co-CEO & Director at Opera

So I think the trend seems to be very clear. And also, all the AI companies also recognize that there will be a significant portion of it that AI has to be located natively on your applications, like on your PC, on your whatever. And everybody now see that browser is probably one of the best mediums. It's just by design. Because by design, a web page cannot access so many informations.

Lin Song
Lin Song
Co-CEO & Director at Opera

It has to be locally, while browser is local. So it's a natural linking between the web environment and also local environment. So that's the trend that we see. And I think that's exactly why we are spending we're doing a lot of research on NIO, just because we feel that we are actually in a better position to do this. I also saw some comments that many other companies commenting about, they also think it's relevant, but of course, maybe people don't realize that we are probably one of the few ones which has the scale and the capacity to do it, right?

Lin Song
Lin Song
Co-CEO & Director at Opera

Even you look at some other player, you know, hot ones planning to want to take over Chrome and they have only like 20,000,000 MAUs in total, right? Well, we already have existing almost 300,000,000 MAUs, which have been running for many, many years. So I think we are in very good sport to actually make that happening, and that's what we are focusing on. And I think that's also part of what we believe in the future. And then just a few lines, right?

Lin Song
Lin Song
Co-CEO & Director at Opera

So I think in the future, the economics and business models, I would almost say that I think they'll always be some will be free, because we can we believe that they can be powered by advertisements, as what we're doing now, whether it's through partners or whether it's through some other more like or other different partners. I think we are very good to actually monetize. Again, I think we do a better job than most of some of the startups. But then, I think if you want to have some deeper experience, I also think it's already proven that people are willing to pay subscription money for it for some expensive usages. And I think it also failed that we follow the same model.

Lin Song
Lin Song
Co-CEO & Director at Opera

So yeah, so I believe it's always a good combination that it will be sponsored by advertisement. And then it will also be a subscription model for web audience to enjoy device assurance purely because that's already been proven and people are ready to spend money on it. I hope this helps. Great.

Eric Sheridan
Eric Sheridan
Managing Director at Goldman Sachs

Thank you.

Operator

We'll go next to Lance Vitanza with TD Cowen. Please go ahead.

Lance Vitanza
Lance Vitanza
MD & Senior Analyst at TD Cowen

Hi. Thanks, guys, and congrats on the quarter. I have two questions, if I could. The first is on the Stablecoin MiniPay, the 9,000,000 activated wallets. That's great.

Lance Vitanza
Lance Vitanza
MD & Senior Analyst at TD Cowen

How do you monetize the engagement? Is this just about encouraging user growth and retention? Or is there another angle here? Is there any way to connect the dots between mini pay user growth and, I don't know, sustained ad revenue growth, for example?

Lin Song
Lin Song
Co-CEO & Director at Opera

Yeah. So it's Tony Hill. I think I also tried to cover this. And I further can also supplement with also other information. So like again, like we are trying to be conservative in calling out those new initiatives.

Lin Song
Lin Song
Co-CEO & Director at Opera

We have launched for the record. We have been actually incubating the debate for a few years. And very happy that we are now seeing that expanding. And also now it's the right moment, right? So like, again, internally, are very excited, quietly excited, I would say, to see the growth of it, to see the very good for the market fit in many places.

Lin Song
Lin Song
Co-CEO & Director at Opera

And we also see that the right adoption of stablecoin across the industry, which of course is very necessary for anything to succeed in a fintech world. So now I think we're starting to see that many of the stars are starting to align, and that's why we are also getting very excited. And then, maybe just super quick on monetization, right? So I actually feel that, again, MiniPay is one of the few products that it's a good combination of both very good product marketing fit. But actually, it also comes with monetization.

Lin Song
Lin Song
Co-CEO & Director at Opera

I think nature is just that it's very close to it is a product which are very close to money, I would say, for the nature of fintech. So for now, like it's already actually generating sensible money from us, even though, of course, for now, that's not the short term purpose. Our purpose, of course but yeah, but the standalone international already proven, I would say, for monetization. So for now, I would say the pure monetization model will be for us to work with ecosystem partners to integrate that, all those functionalities, like we are including all those data points into MiniPay. And we get a cut, right, for whatever they earn based on some strategic investment agreements.

Lin Song
Lin Song
Co-CEO & Director at Opera

So like, again, maybe just echo back to say that I think this is the mini page is a very good example where the nature of the product, it comes almost with monetization potentials without having to go through, say, advertisements or without having to go to search or other means. It's just because Stablecoin itself, this industry, are rather profitable. I guess it's also driven by some of the recent listings by Circle. And also, there are some of tabs, like Tableau and a few others. So I think it's also why we are very excited because as far as you have enough user base and as far as you have to go to use it, there are actually very natural opportunities for you to get revenue out of it.

Lin Song
Lin Song
Co-CEO & Director at Opera

So I would almost maybe compare this with Search. So why Search is very good for the browser in the audit days, in audit ten years is because when people are using Search, they don't really see that as advertisement, right? They see that as an important functionality. But the way, of course, along the way, also making money. So I would almost say that the Mini Pay is of a bit similar nature, that you don't have to see some ugly ads popping up or whatever.

Lin Song
Lin Song
Co-CEO & Director at Opera

You can just use it. And by the nature of it, there is a chance for us to monetize.

Lance Vitanza
Lance Vitanza
MD & Senior Analyst at TD Cowen

That's great. And actually, that sort of ties into my next question, which was on search revenue and the rebound there. And Frode, I think you mentioned that it was expected and maybe I lost track of why you were expecting it to rebound. But I'm just wondering if what drove that? I tend to think of search revenue as a function of number of searches.

Lance Vitanza
Lance Vitanza
MD & Senior Analyst at TD Cowen

So did search volume rise on a per user basis, or is this simply a change in revenue per search that's perhaps driven by the shift in users to higher value markets?

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

Yeah, when we last reported, we already saw the trends are picking up. We were in the single digits year over year growth last quarter, and then we saw we were getting back towards the double digits. And I think we expect surge to continue to do well for the remainder of the year, and that's reflected in our guidance. But I don't think I should go into the detailed breakdown of how we model or predict it.

Lance Vitanza
Lance Vitanza
MD & Senior Analyst at TD Cowen

Okay, well, about, at least can you discuss whether you think it's a new trend line? Or was it more of sort of a, you know, how durable do you see this, resurgence potentially being?

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

I think that the broader search landscape is changing rapidly, right, with the theme of a lot of this call as well with various kinds of new information processing and gathering services. I think that is very, very interesting as a browser, right, being able to send traffic to partners, but also being able to natively integrate those types of solutions in the product that we talked about with Neon. So, as a broader concept, think we are very enthusiastic about this. Might be a bit narrow almost to call it search, right? Because it's almost like information discovery and how the browser becomes increasingly relevant in that space.

Lance Vitanza
Lance Vitanza
MD & Senior Analyst at TD Cowen

Fair enough. Thank you very much.

Operator

We'll go next to Jim Callahan with Piper Sandler. Please go ahead.

Jim Callahan
Jim Callahan
VP - Internet Equity Research at Piper Sandler Companies

Hi, thanks for taking the question, everyone. Can you talk more about the tariff related headwinds you kind of called out in the quarter? Are these temporary or is this something we can see kind of like persisting through the rest of this year?

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

Yeah, I can comment on that. I think it played out a bit as expected. So, when we last reported it was late April, and we were, you know, we were past initial launch of tariffs. And I think, of course, since then, maybe there's been somewhat more stabilization in the broader picture. But it did translate into a real headwind, and we are very proud to have been able to offset that with global growth, essentially.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

So, I think as we look ahead, I think we are starting to see some recovery now, but it definitely represents an upside potential for us to see a return to even higher activity levels as in pre tariff terrain.

Jim Callahan
Jim Callahan
VP - Internet Equity Research at Piper Sandler Companies

Got it. That's helpful. And then Opera GX launching in South Korea and Japan, I guess, how should we think about sort of like the size of that opportunity would be helpful.

Lin Song
Lin Song
Co-CEO & Director at Opera

Yeah, it's Soni Hill. So I can briefly comment, right? So I would almost say that it's the early stage, but I guess, you know, we have announced that we are League of Legends, the preferred browser. And of course, as you know, that naturally, East Asia is actually one of the bigger, almost important places for those games. And as a result, we actually see that there are some very interesting attractions that the GX are becoming to be liked by The U.

Lin Song
Lin Song
Co-CEO & Director at Opera

Countries. So, I think it's very natural for us to deepen down. And that's the only thing that, of course, those regions also require more localization because they are all pictured always, and we have not really prioritized this in the past. But now we see opportunities, so we'll dive in. I think it's a bit too early to estimate the scale in these market returns, but it's a very exciting market.

Lin Song
Lin Song
Co-CEO & Director at Opera

And interestingly, just to comment that and partly, noise also that we do already see quite strong growth on, say, e commerce potential in those regions based on our still regular user base or limited user coverage on the generic browsers. So essentially, think another important factor that we are very excited about monetization potentials. And I think that's also why we feel that it's the right move to further spreading the coverage on those key, I would say, developed countries.

Jim Callahan
Jim Callahan
VP - Internet Equity Research at Piper Sandler Companies

That's great. Thank you.

Operator

And as a reminder, if you'd like to ask a question, you may do so by pressing We'll go next to Mark Argento with Lake Street. Please go ahead.

Mark Argento
President, Co-Founder & Head - Institutional Equities at Lake Street Capital Markets

Good morning, guys. Just a few quick ones here. On the e commerce business, is that business, we start to comp, the comps get a little bit more difficult. But how should we think about the seasonality in terms of kind of the revenue there? Obviously, probably a little bit more weighted over time to the higher spend quarters, but just wanted to get your thoughts on how you see that playing out in the different verticals.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

Yeah, sure. Mark, I can comment a bit. So as a recap, I think what we saw last year was that we went from a 17% year over year growth rate in the first half of the year into 20 and then 29% growth in the second half. So, the comparables are definitely quite challenging in the second half of the year. Of course, the underlying, it is the shopping season.

Frode Jacobsen
Frode Jacobsen
Chief Financial Officer at Opera

So, that is a tailwind for the second half of the year. At the same time, we try to not bake in the same kind of home run-in our second half expectations at this point in time, but rather take a more cautious view. That's why we look at the two year growth rate by quarter to guide something that's a bit more of an even growth profile all in all.

Mark Argento
President, Co-Founder & Head - Institutional Equities at Lake Street Capital Markets

Okay, that's helpful. And then in terms of various vertical, obviously, it's still mostly focused on more kind of, you know, product or, you know, goods versus services at this point. Is there opportunity to expand and travel in some other areas above and beyond just more of the kind of the traditional goods area?

Lin Song
Lin Song
Co-CEO & Director at Opera

I can try to cover this. So yeah, more like Shubayi, I would just open that. You know, for now, of course, see the fastest growing is retail, so that's great. And it's also proven that, you know, like the, let's say, the intent based advertisement with help actually works. And you know, because I think also mentioned earlier that all our advertisement, almost all our performance based, very solid proof that it actually works.

Lin Song
Lin Song
Co-CEO & Director at Opera

So, and then I would also say that we see very close the follow-up. Traveling is definitely key sectors. We are traditionally already fairly big, like a browser is historically always a fairly big distribution partners for travels, like booking.com, for instance. So yes, 100% that we see that it's a good combination on both browser, but also AI. So that is definitely very interesting.

Lin Song
Lin Song
Co-CEO & Director at Opera

And then I guess, we also commented maybe a bit earlier that there are also some other verticals like FinTech, for instance, that could also be quite relevant. Because again, it's also a good combination of, you see most of those executive browser environments, very natural. And also, are also the one probably affected most by AI that there could also be maybe a better combination of things. So I would say all of the areas are good potentials for us to develop further, and we are looking to those.

Mark Argento
President, Co-Founder & Head - Institutional Equities at Lake Street Capital Markets

Thank you. That's helpful. And then just pivoting quickly, it wasn't overly clear to me at least on the Neon product launch. Is that built on your guys' Are you guys using other LLMs?

Mark Argento
President, Co-Founder & Head - Institutional Equities at Lake Street Capital Markets

Maybe just refresh me and better understand what is powering that new browser.

Lin Song
Lin Song
Co-CEO & Director at Opera

Sure. So yeah, it's Onil. I was going to cover that. So yes, I think essentially, we are using same approaches as most others. We do rely on the big base models from those bigger companies.

Lin Song
Lin Song
Co-CEO & Director at Opera

I don't think we have planned to spend billions of dollars to train the large language model, because I think that's repetitive. And I guess the beauty of that is that because the market on big language models are so competitive, that it's almost a bit commoditized in some ways, that actually allow us to be able to have a good relationship with almost all of them, to actually be able to use the best language model at any given time and any given scenario. So I would almost say that's an advantage of that. And also, because of all the investment and the competitions, we actually see that the costs have actually been lower down quite dramatically. As far as there is still competition, we believe that will still be the case.

Lin Song
Lin Song
Co-CEO & Director at Opera

And I think that's actually a good time for players like us. And then on top of it, I think our contribution would mostly be on, number one, how to give the relevant context and how to allow AI to operate in a browser native environment, I think that will be the best advantage that we would have. And I think that will be a huge win for us to nail it, and that's what we are focusing on.

Mark Argento
President, Co-Founder & Head - Institutional Equities at Lake Street Capital Markets

Last one for me. Tim touched on a little bit earlier, but Perplexity was out with their unsolicited offer to buy Chrome browser. A little surprised you guys didn't get any play on that in terms of just kind of being in the mix. It sounds like Perplexity went and talked to handful of the other browser players out there. Is there a strategic opportunity for you guys to work with other large branded guys above and beyond what you're doing right now?

Mark Argento
President, Co-Founder & Head - Institutional Equities at Lake Street Capital Markets

And how do you think about, if you could size it for us as well, how big is actually your browser installed base right now? Because I don't think the market's value and the strategic value of that installed base.

Lin Song
Lin Song
Co-CEO & Director at Opera

Yeah. Yeah. Okay. So I guess I'll comment a bit, boss. And then I think it's a bit more for them.

Lin Song
Lin Song
Co-CEO & Director at Opera

Matt can also comment a bit, right? So Okay. So I guess it's very interesting. I mean, all course follow this closely, as you know that well. So we are more or less involved in all those discussions, right?

Lin Song
Lin Song
Co-CEO & Director at Opera

So we are very familiar with the player there. So Okay. So first of all, I would just say that, yes, it's actually quite interesting to see, right? Because, of course, we saw some of the players claiming that they are a better position. They are one of the few positions to be able to accommodate from should there be some jurisdictions.

Lin Song
Lin Song
Co-CEO & Director at Opera

And I guess, we, of course, are always a very good partner for more than twenty years. But then I would just say that, of course, I guess, like we are probably and we are one of the biggest independent browser out there. We have been independent for the past thirty years, which we are celebrating this year for thirty years. And we are the innovator on browsers. And we have a deep understanding of technology.

Lin Song
Lin Song
Co-CEO & Director at Opera

And more importantly, we have, of course, 300,000,000 MAUs and still growing. So I think everything is very strong, pointing that we are in a very good position for all those discussions. So it's more like just interesting point out, right? So like if we're actually talking about whoever is the biggest independent browsers, think our name should actually pop up very high. I guess the only thing is just because being a European company has some product code, I guess, that is probably less frequently being discussed in those contexts.

Lin Song
Lin Song
Co-CEO & Director at Opera

But again, I think it's just our job to be visiting U. More and we should also and of course, U. S. Has been our biggest market for the past many years. And it's becoming more and more relevant, and we should just work more on it.

Lin Song
Lin Song
Co-CEO & Director at Opera

So I would almost say that's our feelings for now, and otherwise, I think it's hard for us to comment anything particular related to this case, investment cooperation with all the partners involved there.

Mark Argento
President, Co-Founder & Head - Institutional Equities at Lake Street Capital Markets

Great, thank you.

Operator

It appears we have no further questions at this time. I will now turn the program back over to Song Lin for any additional or closing remarks.

Lin Song
Lin Song
Co-CEO & Director at Opera

Sure. So like again, thank you to everyone for joining us today. We look forward to sharing those results and outlook with you. And now, we welcome to an extremely exciting second half of the year. We have many launches to come.

Lin Song
Lin Song
Co-CEO & Director at Opera

We will work hard to seize the opportunities that come with it. And look forward to keeping you posted. Have a good day, all of you.

Operator

This does conclude today's program. Thank you for your participation. You may disconnect at any time.

Executives
    • Matthew Wolfson
      Matthew Wolfson
      VP - IR
    • Lin Song
      Lin Song
      Co-CEO & Director
    • Frode Jacobsen
      Frode Jacobsen
      Chief Financial Officer
Analysts
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