Welcome to the Opera Limited fourth quarter and full year 2022 earnings call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during this period, you will need to press the star key, followed by the Pound on your touch-tone phone. If you want to remove yourself from the queue, please press the Pound key. Please be advised that today's call is being recorded. Lastly, if you should require operator assistance, please press star zero. I would now like to turn the call over to your speaker, Matt Wolfson, Head of Investor Relations. Please begin. Thank you for joining us. As usual, I have with me today our Co-CEO, Song Lin, and our CFO, Frode Jacobsen. Before I hand over the call to Song Lin, I would like to remind everyone that in the conference call today, the company will be making statements about its future results and expectations, which constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Such statements are based on current expectations and how we perceive the current economic environment and are inherently subject to economic, competitive, and other uncertainties and contingencies beyond the control of management. You should be cautioned that these statements are not guarantees of future performance. You may refer to the safe harbor statement in the company's earnings release for details. Our commentary today will also include non-IFRS financial measures, including adjusted EBITDA, which are different from our consolidated financial statements that are prepared or presented based on IFRS. We believe that the use of our non-IFRS financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends. These measures should not be considered in isolation or as a substitute for financial information prepared in accordance with IFRS. We have also posted unaudited quarterly historic financial results of Opera on our investor relations website. We'll be live tweeting highlights from the call at Investor Opera, so please follow along there during the call and in the future. With that, let me turn the call over to our co-CEO, Song Lin, who will cover our operational highlights and strategy, and then Frode will discuss our financials and expectations going forward. Song? Yeah, sure. Thanks, Matt, thank you everyone for joining us today. We are very pleased to announce our record results of the fourth quarter, which well exceeded our previous issue guidance of both revenue and profitability. Revenue reached $96.3 million, an increase of 33% over the previous year. Adjusted EBITDA came in at $22.8 million or a 24% margin. Looking back at the quarter and 2022 as a whole, we were able to exceed our revenue expectations as a result of better-than-anticipated monetization of both our browser and new user base and faster-than-anticipated scaling of the Opera Audience Extension business. Combined with a predictable and carefully managed OpEx base, we have been able to convert our strong revenue trajectory to a strong profitability trajectory, even ahead of our ambitions. To recap, the full-year revenue was $331 million, with adjusted EBITDA of $68 million. Revenues grew 33%, while EBITDA was up 135% as full-year margins expanded from 12% to 21%. The impact of our ongoing focus on those users which provide the most value can best be seen in our annualized ARPU. Annualized ARPU was $1.18 in the fourth quarter, an increase of 12% from the third quarter and a 42% increase compared to last year. Advertising revenue grew 55% compared to last year, now representing 59% of total revenue. Our owned and operated sites continue to benefit from the continued shift in our user base towards developed markets with the greatest monetization potential. In addition, Opera's audience expansion initiatives were a standout success, leveraging our high-performance bidding infrastructure and first-party signals to reach the right audiences across partner inventories. These efforts, which really took off in 2022, are an excellent complement to our own advertising inventory. This segment has offered us stable incremental margins and is shaping up to be a material component of our revenue and EBITDA growth. Search revenue grew 12% in the fourth quarter, which was also better than planned, driven by the growth of our PC footprint in Western markets, particularly North America. As a result, when revenues outperform, as they did in 2022, we will see a corresponding increase in profitability. As we outlined in 2021, when we first embarked on a significant investment in our marketing and distribution channels, we believed that we would reap the results in 2022, and that is exactly what we achieved as EBITDA margins expanded from 12% to 21%. But perhaps most important, now coming to our products and innovation focus. Opera as a company has a more than 25-year history of being at the forefront of browser innovation. We have built out more than 300 million user base by always pushing the limits of what's possible on the web. The mass interest in generative AI tools and the often impressive capabilities that these tools already have certainly marks the beginning of a new chapter in the evolution of not only the Internet, but the knowledge base, economy at large. For Opera, that represents a huge opportunity, perhaps similar to the emergence of mobile web and smartphones. As an independent browser, we are firing on all cylinders to become the best gateway to an AI-powered web. Building and rolling out new experiences in web browsing that not very long ago seemed impossible to achieve. For instance, we are adding popular AI-generated content service to the browser sidebar. On top of that, the company is also working on augmenting the browsing experience with new features that will interact with these new generative AI-powered capabilities. Among the first features to be tested is a new, small, but super useful shorten button in the address bar that will be able to use AI to generate short summaries of any web page or article. Not all of you may be aware that AI has been central to Opera News from the beginning, more than five years ago, to serve up stories and content relevant to our users in a personalized way. In 2023, we are going to ramp up our AI news efforts. It will start with using AI to assist content creation. For instance, AI will be able to help summarize the top stories of the day and then generate short articles to keep users informed of local and national news. These stories will cover subjects such as sport, weather, crime reports, energy and fuel prices, and other information relevant to their lives. These features are being pushed out as we speak. We believe AI will soon be an indispensable tool in assisting people across industries. With our experienced talent pool in that field, we are naturally very excited about the future. Both our search and advertising revenues also benefit from increased engagement, and we are seeing that across all of our products. In emerging markets, Opera Mini has benefited from the integration of real-time football scores, leading to increased frequency of use, and we are replicating this feature in South Asia with cricket. To celebrate the most recent World Cup in Q4, we have launched also a campaign we called Shake & Win. The campaign pushed Opera Mini to the number one position in the Google Play Store in several of our key countries in Africa, while we again are also replicating the success to Latin America in key countries like Brazil, with early success already in view. In terms of users, our total base was 324 million MAUs in the first follow, a nice sequential increase. For the past years, we have repeated our focus on higher, high-value users, often in Western markets, but also have distinguished between user opportunities in emerging markets. We have let the less monetizable users churn out while focusing growth on acquiring fewer but higher value users. We are very pleased to see our strategic growth more than offset reductions in less strategic areas, putting us in a great starting point for 2023 and beyond. GX continues to grow its user base, particularly in developed markets. As we have announced in December, the gaming browser now has over 20 million MAUs. As we said before, despite being our best monetizing browser, with the ARPU up 11% sequentially to $3.3, we are in the early stage of unlocking the full potential of the GX, the gaming browser. We believe GX is at a perfect crossroad by being the most popular gaming browser and entry point for those users. It allows us to combine multiple next generation technologies from building a decentralized hub through Web3 and blockchain to using AI to assist in game creation with our GameMaker Studio. It's a great example of where we see multiple new technologies from the past few years converging around a young audience base, creating a future that is super exciting and has the potential to exceed everyone's imagination. With that, let me turn the call over to Frode for details. Thanks, An. On top of the operational color, I'll turn to the numbers. It was a great quarter, rounding off the year well ahead of our expectations. Q4 revenue came in as much as $5 million above the top end of our fourth quarter guidance at a record $96.3 million, representing 33% year-over-year growth. That is something we are really proud of, especially in light of the fact that we had already raised guidance after both Q2 and Q3. In the face of ongoing macroeconomic challenges. Similar to last quarter, the outperformance primarily came from the continued growth of users in Western markets and the ongoing ramp in our Opera Audience Extension business that simply scaled faster than we dared anticipate. adjusted EBITDA was about $4 million above the top end of guidance, coming in at $22.8 million or a 24% margin. Profitability benefited from our revenue overperformance, combined with continued cost discipline and OpEx coming in a bit below expectations. Cost of revenue scales with our Audience Extension-related advertising, but associated gross margins have been stable to even improving through 2022, resulting in material profitability contributions. During the quarter, we repurchased 0.6 million ADSs for $3.2 million under our regular buyback program. That comes in addition to our separately announced major buyback of 23.4 million ADS equivalents from a pre-IPO shareholder at $5.50 per ADS, or $4.70 per ADS if comparing to the current share price, which is net of our recent $0.80 dividend. For 2022 as a whole, we executed a total return of capital of $146 million, taking 26.7 million ADS equivalents off the market and effectively increasing each remaining share's relative ownership of Opera by about 30%. We have been taking advantage of our strong balance sheet to elevate the ROI for our investors. As of today, we still have over $30 million remaining under our current buyback authorization. In terms of cash generation, we had a straightforward quarter with working capital items netting out and operating cash flow coming in at $23.5 million, quite in line with adjusted EBITDA. Net of our stock repurchases in the quarter that amounted to $132 million, we ended the year with $118 million of cash and marketable securities. In addition, $13 million of other receivables were sales of marketable securities with settlement in the first days of the year, leading to an underlying cash balance of $131 million as we started 2023. We were very pleased to issue a special $0.80 dividend earlier this year, which translates to a $71 million expense at the reduced share count. Leaving us with a strong balance sheet of $60 million cash before cash flows in 2023, as well as $59 million in remaining installments from the sale of Star X. Finally, our stake in OPay as an asset held for sale, which increased from 6.4% to 9.5% following the immediate settlement of our receivable from the sale of Nanobank, as laid out in our press release. Turning to our guidance for the full year 2023 and the first quarter. For the full year, we guide revenue to be between $370 million and $390 million, representing 15% year-over-year growth at the midpoint, with adjusted EBITDA guided between $71 million and $81 million or 20% margin at the midpoint. In terms of cost expectations, we model cost of revenue items just above 20% of revenue, following the growth of our audience extension offering. We maintain our previous expectation of around $30 million in average quarterly marketing costs. For both, we expect the trajectory to start below average in the beginning of the year, then move gradually higher. Cash compensation cost is expected to drop slightly into Q1, increase year-over-year, mainly from salary adjustments. Finally, all other OpEx items before adjusted EBITDA are expected to come in a bit over $30 million combined for the year. For the first quarter, we guide revenue to be between $83 million and $85 million, 17% growth at the midpoint, and reflecting the greater seasonality of our rapidly growing advertising business. We guide adjusted EBITDA to be between $17 million and $19 million, a 21% margin at the midpoint. In summary, 2022 was a record year for Opera, and we are thrilled with the operating and financial results. The outperformance we experienced, coupled with our efforts to realize values and turn all focus to our core business, has set us up for continued success in 2023 and beyond. Has allowed us to conduct major repurchases as well as pay our first dividend. With that, I would like to turn the call back over to the operator for your questions. Thank you. As a reminder, to ask a question, please press star and one on your telephone keypad. To withdraw your question, please press the pound key. When posing your question, we ask that you please pick up your handset for optimal sound quality. We'll take our first question from Lance Vitanza with Cowen. Please go ahead. Hey, good morning. This is Jonathan on for Lance. Congrats on the strong quarter. Very good. My first question comes is, where did the user base growth, the 324 million, where did it come from? In terms of region? Hey, this is Frode here. I'll chime in. The Western market is the key growing area for us, both in terms of users and in terms of revenue. We did see growth across all regions revenue-wise, from Q3 to Q4. Okay, got it. Can we expect sequential increases in user base growth throughout 2023 as well? Or can we expect like somewhat of a deduction as the year progresses? We don't guide user base. I think it was a milestone to where our strategy of focusing on high-value users led to also a growing total user base in the fourth quarter. 4 Q is sort of a strong quarter in terms of engagement, time spent and so on. I think I'd expect it to be quite stable. Could be a bit down in Q1 from seasonality, but I think the underlying trend of having washed out enough less strategic users such that the strategic growth offset it was sort of the main bet theme we expect to continue, broadly speaking. Understood. The last one for me, the GX browser, impressive growth there on an ARPU basis, right? Just wondering, at what margin do they come in, and what can we expect from the GX browser in 23 that will continue to improve revenue growth? In terms of cost of revenue on the browser side, it is very low. We consider more our marketing cost to almost be the cost of revenue, and we try to optimize that so that on the margin, we still have a comfortable return on our marketing spend. Each incremental user, strictly speaking, has very limited cost of revenue. In terms of 2023 expectations, if Song, I think he got kicked off or dropped off the call, but I don't think we'll guide specific numbers, but we are very excited about the pro-product, about the next versions of it. We do expect the product to continue to grow both user-wise and also revenue on a per-user basis. Understood. Okay, thank you. Yeah. Congrats again. Sorry? Just comment that. Sorry, guys. This is Song Lin. I'm mad to go back to the call, so not a problem. Just to echo what Frode has been saying, right? I think in general, we have been seeing rather strong user growth, more like I think the new strategy that we really focus on more like the, let's say, high ARPU users in terms of total user number. Fact just being that we have actually indeed see quite a strong user growth both for GX and also across the board. We're quite optimistic about that. Again, the focus will be on the high ARPU users. In that regard, we also have high expectations for GX this year. Great. Thank you. We'll take our next question from Mark Argento with Lake Street. Please go ahead. Morning, guys. Incredible quarter. Nice work. Just wanted to drill down a little bit more on the AI opportunity in particular. You know, what do you see ultimately as the, you know, probably the most logical business model using that technology? Does it drive user growth of the browser? Is it a whole other standalone, you know, product you could potentially charge subscription to? Is it an ad-based model? Maybe you could, you know, at least give us some of your initial thoughts. Yeah. Yeah, I think this is Song Li also maybe, I'll just comment a bit to start with and Frode can also chime in, especially for revenue, right? I think for now, to be honest, I think the most distinctive impact which we're hoping is for user engagement, right? More like for driving the user uptake. I think good example being that, of course, where we actually do see, even if we just announced it and even if it's early stage, we see that user interest on the browser has actually increased quite a bit. You know, because originally people just looking for regular system, people browser as always our biggest challenge, right? That, you know, they just use it. Now technology, we actually see all of it the same as the early stage of mobile, right? As we called it, that, there's a lot more interest for people to actually looking for a good browser, which can deliver a very differentiated experience. We think that is actually probably the biggest short-term potentials. We see that is definitely having impact on the user base. I mean, that's also why we see a quite positive growth on the arm. Of course, and then user growth will of course correspond with more user engagement and hopefully more monetization potentials. However, of course, going deeper, it will probably have an even more profound impact on the whole ecosystem, and that is almost beyond Opera, right? For that, my guess would be that probably it will be perhaps leaning more towards, you know, maybe like, again, a higher paid model subscription or something along the lines for especially some of our partners. In line, that will be able to drill down into Opera. I think we feel that there will going to be a lot of changes in the industry and for a player like Opera, probably means more opportunity than anything else. Quite excited. Great. One for Frode. Obviously, free cash flow generation's been strong. You've been returning capital to shareholders. When you think about, the guidance for 2023, the $71 million-$81 million in adjusted EBITDA, should we... You know, is this still like kind of a almost 100% flow through the free cash flow? Or how should we think about free cash flow generation in 2020? Well, for 2022, I guess we converted about 87%. I looked at it just now of our adjusted EBITDA to operating cash flow. The delta is the taxes paid of about $3.1 million in the year and growth of working capital items, about $6.6 million. I'm not guiding for 2023, but at least I can call out that the growth in working capital represented about 28% of the revenue growth we saw from Q4 2021 to Q4 2022. I think it's a relatively fair indication. In terms of taxes, our effective tax rate, if you take our P&L, take our operating profit and add back the equity compensation cost, and look at taxes relative to that, since the equity cost is not tax-deductible, then our effective tax rate is about 18%. All right. That's helpful. In terms of, did you say $30 million in OpEx or, excuse me, in CapEx for 2023? In the other operating items, so from like hosting, legal, travel, office costs, et cetera. The stuff that I commented on the cost of revenue items combined, the marketing costs and the cash compensation costs, and then I just commented on the total for everything else prior to adjusted EBITDA in the P&L. All right. No, that makes sense. In terms of the focus of incremental spend going forward, I'm assuming you're gonna continue to target Western markets. That looks like where you're getting a lot of growth and a lot of extension. Is that, you know, consistent in 2023? I think dollar-wise, that, I mean that strategy remains. It's proven very successful for us, and we still see a lot of room to grow. As Song also talked about, that there are definitely very attractive pockets and good growth to be had also in emerging markets. So we have been, we are investing in that too, but we have gotten better at focusing on monetizable users there. So that they are of course massive markets and we will focus globally. Great. Thanks, guys. Congrats again. Thank you. As a reminder, that is star one for your questions. We will take our next question from Alicia Yap with Citigroup. Please go ahead. Hi. Thank you. Good morning, management. Thanks for taking my questions. Also congrats on the strong results and the guidance. I have two questions. First is, wanted to follow up on this, you know, your partnership with OpenAI on AIGC. I think you touched a little bit in the earlier question. I'm just wondering, you know, the benefit that you're going to see, one part of it is the higher user time spend, right? In what kind of content that you believe that would be improved on the targeting effort that you can reach out to the user. So far or has that already launched and then so far is it more obvious that you see the improved in user engagement on the mobile version or on your PC browser? That's the first question. Yeah, sure. This is Song Lin. I'll try to answer it. It has to be like this, right? I think it's. First of all, just to comment that there's in general two kinds of AI, right? One is the discriminative AI, which is actually what Opera News have been using, and it's also the one being used in news recommendation, content recommendation and autopilot, for instance. The other is the generative AI, which is what's been popular now. I would say that we're moving forward, we probably will see both becoming more and more relevant and with people a little bit more focused, right? The first one, discriminative AI, will be able to give you the more relevant content. I think that way already, actually, it's always ongoing. Mm-hmm. People just perhaps didn't notice it, but then it's becoming much more visible, right? And then, like, I think the generative AI are more like in the ground where people will be able to see content with their own flavor, right? More like, you know, you need a use case, for instance, is that if you have a particular flavor of ways how you want to see the news or articles, you can of course always ask AI to give you a summary based on your flavor, right? I think, I would say that's more like one algorithm is to be able to give you the relevant content. The other is turn the content into what you might like. I think both are gonna be very relevant. Like, as I said, it's still very early stage, but that's proven to be very clicking with also users mentality, right? I think for now, we're just gonna explore other kind of options and, you know, I think we're just happy enough if there's more user to actually use us because of our differentiating features. That's probably the biggest short-term gain. Also, for instance, the longer time spent. More... I guess that's a high level capturing of what might come into view. Do you expect that will be helping on increasing revenue opportunity within this year that you will already seeing it or we will have to wait a little bit longer? Yeah. I think it's a $1 billion question, right? More like what's that impact gonna be on revenue. I don't know. It's too early to tell. I don't think we have actually budgeted in our forecast or guidance, because we should be prudent. As I said, right, if there's more users using us, then of course more naturally and that will drive to a higher revenue. It just is quite early, so we don't want to maybe guess on that. I think, it's a very interesting opportunity for us. I see. Okay, great. Thanks, Song. Second question. I think, you know, company comment on the press release about the EU sanction package that happened in December 2022, so which you budgeted a $10 million headwind, right? Without that, is that fair for us to assume the midpoint on, of your guidance, would have been 18% this year instead of the 15%, right? Also related to that is can you remind us in 2022, how much exactly was the negative headwind that you experienced from Russia in total? Because I remember, you know, back in the first quarter last year, which is around May, you mentioned that the Russia... I'm not sure if I remember correctly. It was potentially about 10%, but you only see about half of that impact. Was that memory sounds right? You know, this whole impact it is, when you budget it in, it means, would that mean potentially if it's not as strong headwind as they say, then we could actually see some upside on the revenue? Yeah, I can begin commenting on it. You are correct that adding back that 10 that we deduct directly would put the midpoint at 18%. I think, on top of that, the situation at large, of course, also leads us to sort of add more cautious to the guidance that we put out there. I would say, directly correct and broad, but also broadly speaking, the broader macro picture, is also adding, I would say, incremental caution, but we haven't put a number on it, but as we come from in connection with the guidance. In terms of the Russia and Eastern Europe, I would say, we did see of course the impact last year as well. Currency rates also fluctuated quite a bit. Broadly speaking, we ended the year with a relatively similar footprint in Eastern Europe as we had it at the beginning of the year. I see. Okay. All right. Well, thank you so much. Thank you. Sure. All right. There appears to be no further questions at this time. I will turn the call back over to Song Lin for any closing or additional remarks. Sure. Again, I think, thanks everyone for joining our conference call. You know, year 2022, we have been able to, do with the good results. We are very excited, about it. We think that, you know, 2023 is also going to be very interesting. You know, both the, out performance we already experienced and coupled with our efforts, to, realize more values and turn all focus into, you know, into our core business has been able to put us in a good position for the success in 2023. Yeah, we are very thrilled about it. I would also like to personally thank, all the, you know, both Opera employees and also our investors, the support that has been given to us in the past year. Let's have a great excitement of year 2023, and looking forward to share more of our success with you in the coming quarters. Appreciate your time, and look forward to speak again in the future. Thank you. This does conclude today's program. Thank you for your participation. You may disconnect at any time.