It's time for the financial results for the 4th quarter of 2009.
There is a slight decrease in revenue since Q4 2008, but keep in mind that the NOK was extraordinarily strong at that time compared to USD and EUR, and that it is much weaker now. The currency effect is definitely working against us on a short term basis.
For the full year, 2009 saw a revenue increase of 23% compared to 2008. Profits were down for 2009 compared to 2008. …
- Total revenue for 2009 increased by 23% compared to 2008
- Revenue decreased 9% in Q4 2009 compared to Q4 2008
- Desktop revenue was up 20% in Q4 2009 compared to Q4 2008, and up 59% for all of 2009 compared to 2008
- Profits were lower in 2009 compared to 2008 (although Opera is still profitable for the full year)
- Desktop had about 46 million users in Q4 2009 (up 37% compared to Q4 2008, and up 125% since Q4 2007 – desktop is still more than doubling its user base every two years)
- Mini had 46.3 million users in Q4 2009 as well (up 159% since Q4 2008, and up 575% since Q4 2007)
What's happening at Opera right now is that we are transitioning towards a business model where we rely less on revenue from NRE (Non-Recurring Engineering). If you recall, we recently announced the "one user interface" for our mobile browsers, and this allows us to deliver a standardized product with less development work for us.
In the short term, this means that the revenue from customizing browsers for customers is dropping, but we are also signing a lot of major deals with mobile operators, which will replace that revenue over time. That revenue will be recurring, and will enable us to increase our profits with less engineering work.
To that end, there's a bit of restructuring going on in the company. We're moving resources to our focus areas, and we'll be looking at ways to cut costs and avoid doing projects that cost a lot of money but result in little income. Exactly how this will turn out in the end is unknown at this time. The management will review the company structure, and relocate or remove resources as necessary.
We will probably not see the results of this in the first half of 2010, but if I understand this correctly, we expect profitability and growth to accelerate in the second half of the year when the restructuring has been done and the results of that and various contracts becomes visible.
If anyone was wondering, the desktop browser is a key product for Opera, and is now more than 1/3 of our total revenue (more than 38% in Q4 2009, as a matter of fact). I'm pretty sure Opera 10.50 is going to cause the desktop browser to grow its user base even faster. The ballot screen in Europe will surely not hurt either 🙂
Opera Mini is expected to continue to grow, and the good news is that operators really want Opera Mini in their networks. This means that we can make money from the user base to a certain extent without having to, say, show ads. Of course, we will look into other ways to make more money from the Opera Mini user base. We recently acquired AdMarvel, and I'm sure there are many ways to integrate ads without making them annoying. One example is the built-in Google search, which is one of the most popular features in Opera. It actually brings us ad revenue while the user gets clear benefits from the feature.
And in case you didn't watch the video presentations, we're still working on deals that we haven't announced yet.
You'll also be in for a few (pleasant) surprises this year, I think.