Opera Ltd

NASDAQ:OPRA

Earnings Call Analysis

Continued Growth and Surpassing Expectations

The company celebrates a strong quarter with revenue reaching $130 million. This performance was fueled by robust organic growth and a disciplined approach to expenses, resulting in a remarkable $28 million in adjusted EBITDA, significantly surpassing expectations.

Robust Performance Against Guidance

With an initial guidance projecting 13% revenue growth and a 20% EBITDA margin for 2023, the company managed to outperform these numbers considerably, achieving a 20% increase in revenue and an enhanced adjusted EBITDA margin of 24%.

Advertising Revenue Booms

The advertising segment demonstrated significant growth with a 20% year-over-year increase, reaching $68 million. Coupled with a 15% rise in search revenue, which amounted to $45 million, the company is effectively leveraging its user base shifts towards regions and groups with higher monetization potential.

Year-Over-Year Growth and Top Guidance Performance

The final revenue numbers for the quarter not only hit the upper end of guidance at a 17% year-over-year increase but would have been even higher at 21% on a constant currency basis. This was partially driven by the success of Opera GX in growing high-value user segments in emerging markets.

Exceeding Adjusted EBITDA Guidance

Adjusted EBITDA performance was substantially higher than anticipated, with a $3.8 million boost above the previous range due to lower marketing expenditures and more efficient cost management. The company's financial health was further bolstered by strong operating cash flow and a noteworthy fair value gain from an investment in OPay.

2024 Outlook: Targeting Continued Revenue Growth

Looking ahead to 2024, the company has set a revenue target between $450 million and $465 million, reflecting a 15% growth rate. Expected growth is underpinned by continued progress in advertising and search, with adjusted EBITDA anticipated to range between $106 million and $110 million, maintaining a 24% margin. Marketing spend is projected to be just over $130 million, representing roughly 29% of revenue, while cost of revenue is set to increase slightly, in line with the successful expansion of Opera Ads.

Earnings Call Transcript 2023-Q4

[Operator]

Welcome to the Opera Limited Fourth Quarter and Full Year 2023 Earnings Call. [Operator Instructions]. Please be advised that today's call is being recorded. [Operator Instructions]. I would now like to turn the call over to your speaker today, Matt Wolfson, Head of Investor Relations. Please begin.

[Matthew Wolfson, executive]

Thank you for joining us. As usual, with me today are 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 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 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, and 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 and 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. With that, let me turn the conference call over to our co-CEO, Song Lin, who will cover our fourth quarter operational highlights and strategy, and then Frode Jacobsen will discuss our financials and expectations going forward.

[Lin Song, executive]

Thanks, Matt, and thank you to everyone joining us this morning to review our fourth quarter results. We are excited to report yet another great quarter. Revenue of $130 million, driven by strong organic growth, payout with cost discipline, resulting in $28 million of adjusted EBITDA, well above our expectations. For the full year, revenue was $397 million and adjusted EBITDA was $94 million. The fourth quarter of 2023 built upon the strength we saw throughout the year. This time last year, we guided revenue growth of 13% for 2023 as a whole with a 20% EBITDA margin and the midpoint. Even after raising the midpoint over revenue and EBITDA guidance, every quarter, we were able to consistently beat those expectations and the yield was revenue up 20% and then adjusted EBITDA margin of 24%. We are very pleased that we have been able to consistently deliver revenue outperformance, while spending less than anticipated our marketing and accelerating our margin expansion. This also highlights our ability to seasonally attract new users primarily through organic channels. We did not waver from our strategy to focus on high ARPU users. As expected, we are starting to see signs that higher user growth is not setting lower for churn raised a slight increase in our total user base during Q4. Annualized ARPU grew to a record high of [indiscernible] in the fourth quarter, up 22% year-over-year and 10% sequentially. This was primarily driven by high-value users as well as Opera GX. 2024 will be more of the same weight the goal of continuing to grow these users, both in Western markets as well as high-value duals in general. Combining this focus on high-value users coupled with a stronger product portfolio and ongoing efforts to continually improve monetization, puts us in a very exciting position. We are still a relatively small company with lots of potential remaining in the core browser business. During the quarter, advertising revenue was $68 million, growing 20% year-over-year. Advertising was strong for both our owned and operated inventory as well as Opera Ads. We saw particular strength in the retail vertical during the holiday period, advertising now represents 60% of revenue. Such revenue was $45 million in the quarter, up 15%, which we are also very proud of, given the maturity of this revenue category. As we shift the mix of our user base towards higher monetization regions and user groups, we can generate such revenue growth well beyond the underlying market growth of search-based monetization. Last quarter, I outlined 3 core growth drivers: Generative AI and the work we are doing with Aria, advertising opportunities. And finally, our gaming focus, web Opera GX. I want to give you a brief update on each and how they shape our focus for 2024. For several years, we have used AI to help power our new content products to deliver relevant and customized content for our users. In 2023, we stepped up to efforts, specifically rolling out Aria, our browser AI. Aria has received great user feedback and provided another point of attention that supported our user growth in Western markets. Yet, we need to be mindful that the whole industry is still in the early stage of its potential. Users can benefit more from the AI existence than what they might consider themselves. The mass memory of routine is strong and many integration points within the industry need to be rebid. As we embark our New Year, we continue to iterate and are very excited for this next chapter in the Aria story. We want to integrate Aria into the route experience, assisting do to unlock more efficiency gains, whether it relates to the browsing of the web itself, obtaining or processing information or content creation. As a browser and as an independent ecosystem player, we also have a unique opportunity to help users navigate the broader AI space and simplify their experience. On top, we see potential to help less tech savvy users take advantage of these technologies while enjoying heightened levels of privacy and better protection. In short, the opportunities are huge. Our rewards for healthy [indiscernible] users benefit from Aria is observable not only as part of user growth, but also within engagement and indirect and direct monetization opportunities from monetized links in chatty environments through intelligent recommendations based on the browsing context. As you may have seen, we have announced that we are pairing our product development raised a significant investment in our AI infrastructure, raised the launch of a new data center in Iceland. This data center will be green energy powered and take advantage of the Atlantic climate to reduce cooling costs. And in general, we pride ourselves on our efficient hosting setup, typically and 1/10 of the cost of soft party providers, and we're excited to expand our in-house hosting to the AI space. AI is processing intensive with energy and cooling being key OpEx factors, but less sensitive to latency variations in ministers. As such, Iceland is a great location for our first AI footprint, whereas our other data centers are typically located close to our end users. Shifting to advertising, which remains a top priority given the potential we see to continue strengthening our monetization. As a broader company, we can leverage the closed-loop environment of the browser to capture interest and context while remaining mindful of user privacy, we are able to create value and utility for the euro throughout their online journey, unlike many advertising platforms, which rely on third-party signals and cookies. For example, when shopping online, we do not need to rely on short party cookies to tell us which offers to displace the user, but rather can do so organically.And at the right moment in the use shopping experience, such as discount codes when viewing the card when intent is additized, with the growth of high-value users, we are becoming an increasingly relevant part to even more potential advertisers. Typically in the context of integrated functionality that both benefit our users and has the potential to drive sizable revenue for Opera, representing a significant opportunity as we look into 2024. Beyond our other inventory, Opera as has proven itself as a competitive player in the broader landscape, attracting advertisers based on our technical abilities to augment their targeting. We will continue investing in that platform in 2024, which we will see good opportunities from e-commerce, gaming and other high-intent user interactions in a programmatic way, coupled with advances in AI and algorithms, which we persist in pursuing. And then in terms of our focus on games, Opera GX continues its healthy growth trajectory. Our GX user base was $27.8 million in the [indiscernible], adding 7% high-value users versus Q3 alone. On top of the user growth, annualized ARPU increased to $3.51 during the quarter, up 6% versus Q3. The compounding of user and a growth has brought Opera GX to become products with almost $100 million annualized revenue run rate, demonstrating our ability to be relevant through a young and highly engaged user [indiscernible]. In terms of footprint, Brazil now follows the U.S. as the second largest market of GX. We continue to observe that the GX users in emerging markets monetized significantly below than Euros and other browsers weigh the gap between Western and other Euros been narrowed around PC gamers in particular. We feel great about the prospects of Opera GX Infinite Nitro with continued user growth and further monetization opportunities within this attractive user base. Our ability to invest in the footprint of GX is also ever expanding alongside the growth of the product up. Beyond these three highlighted area of opportunity, we also observed some exciting trends in the broader ecosystem. One is the opening up of iOS for now in Europe, a result of continued evolution of the regulatory environment in the EU and other parts of the world. Such regulatory measures to promote healthy competition is naturally a positive impulse to Opera and an independent player. Also, we are well positioned for the rebounding interest in Fintech applications on Web3, where we continue to invest in technology and build use cases. Both of these carry strategic importance to Opera in the months and years to come. So now let me turn the call over to Frode to discuss the financials and no guidance in more detail. Frode?

[Frode Jacobsen, executive]

Thank you, Song. Q4 was a great quarter for us with a continuation of the strength we have observed all year and a confirmation of our confidence as discussed when we raised Q4 guidance last quarter. Revenue in the quarter came in at the top of our guidance at 17% year-over-year growth. On a constant currency basis, our growth would have been about 4 percentage points higher or 21%. Our user base is growing in Western markets and PC routers also grow high ARPU users in emerging markets due to the success of Opera GX.The decline of low monetized mobile users in emerging markets is offset by strong underlying ARPU growth leading to revenue growth in both Western and non-Western regions for all products. Adjusted EBITDA came in well above our guidance, adding $3.8 million to the top of our prior range. The over performance was driven in particular by lower marketing spend than anticipated in our guidance and cost of revenue coming in about 1 percentage point lower than anticipated relative to revenue. On the other hand, we saw an increase in costs related to advisory services supporting our internal teams on SOX readiness as well as the bad debt provision. Cash flows came in at the high end of expectations relative to adjusted EBITDA with an 88% conversion to operating cash flow for the year as a whole and 77% conversion to free cash flow from operations for the year as a whole and both slightly stronger in the fourth quarter in isolation. Tax cost for the year was relatively modest at 7% of adjusted EBITDA. In 2023, we benefited from both the recognition of tax assets in relation to our share-based compensation in prior years as well as FX movements between USD and local currencies in which our taxes are calculated and paid. Our year-end balance sheet includes an updated fair value assessment of our investments in OPay. We value our stake at an estimated $269 million, up from $163 million before. This results in a significant noncash accounting gain of $106 million in the fourth quarter. As noted in our press release, we've observed that the company more than quadrupled its user base during 2023 and saw an even higher uplift in daily usage in turn, driving strong revenue growth. The updated valuation also ties with the limited investment by a new OPay investor in late 2023, which subscribed at a $3 billion OPay valuation.We remain interested in selling our stake in OPay at the right time. We are also open to a later stage exit in connection with OPay eventually going public according to its longer-term plans. Our OPay stake stood at 9.44% as of year-end. We completed our most recent buyback program in the quarter, repurchasing 1.15 million ADSs at an average price of $11.27 totaling $13 million. We thereby fulfilled the $50 million buyback that was launched in early 2022 with a total of 6.1 million ADSs repurchased at an average cost of $8.17. We will continue to consider buybacks in technical manner to maximize value for our shareholders in the long run. Since 2020, we have repurchased 35.5 million ADSs, equal to 30% of the shares outstanding at that time at a cost of $228 million or $6.44 on average per ADS. When adjusting for dividends avoided, the average cost is even more attractive. However, as we look ahead, it is our recurring dividend program launched in 2023 and currently at $0.80 per ADS per year that is expected to be our main avenue of returning funds to our shareholders. Now turning to our first guidance for the full year 2024 and the first quarter. For 2024, as a whole, we are guiding revenue to $450 million to $465 million, representing 15% growth at the midpoint. The guidance assumes continued convergence between the growth rates of advertising and search. So further upside would more likely be fueled by advertising. We expect to continue our browsers growth trajectory with high ARPU users, and we expect continued expansion of Opera Ads. We guide adjusted EBITDA to $106 million to $110 million, representing a 24% margin at the midpoint. The EBITDA guidance is highly exposed to what marketing costs we assume, and this cost is also highly discretionary. In 2023, marketing costs came in at 28% of revenue versus about 32% in our original guidance for the year. As a reminder, marketing costs was 35% of revenue in 2022 and even 48% of revenue in 2021. From a relatively low spend level at the start of 2023, we scaled our marketing activities quarter-to-quarter. We are encouraged by our ability to scale at attractive ROI. And as we look to 2024, we expect to continue the sequential trend as an investment in our growth trajectory also beyond the current year, though starting the year with the Q1 spend more similar to Q4. In sum, this translates to a marketing spend expectation of just above $130 million or about 29% relative to revenue. Cost of revenue items combined represented 23% of revenue in 2023, scaling with the successful expansion of Opera Ads. Our guidance implies a modest continuation of the trend, adding about 1 percentage point relative to revenue for 2024 as a whole. Similar to 2023, the percentage will start below the annual average and increase in subsequent quarters. For remaining cost expectations, both cash-based compensation costs and the sum of our other cost items prior to adjusted EBITDA are expected to grow year-over-year in the mid-single digits. And as a result, are expected to drop about 2 percentage points relative to revenue combined. For the first quarter, we guide revenue to $99 million to $101 million or up 15% year-over-year at the midpoint and adjusted EBITDA of $22.5 million to $24.5 million or a 24% margin at the midpoint. In conclusion, we've put behind us a year that progressed ahead of our expectations, both in terms of revenue and profitability, and we are excited to embark on 2024. We're only 2 months out from releasing Q1 by now, and we look forward to giving you more color on how 2024 is shaping up then. With that, I'll turn the call back to the operator for questions.

[Operator]

[Operator Instructions]. We'll take our first question from Lance Vitanza with Cowen.

[Lance Vitanza, analyst]

Congratulations on the quarter. A couple for me, if I could. The first is with respect to the headroom that you think you have to further expand the user base in the high-value markets like the U.S. and Western Europe. And I know you touched on this a little bit during the call, but could you provide any more color on how penetrated you believe you are in those markets today versus where do you think you can ultimately take that? And then I was not quite sure I followed the commentary around Brazil and how that comes into play. I mean, that's not necessarily a high-value market, but it sounds like you're seeing some progress there. So perhaps you could revisit that and elaborate on that that would be helpful. Are you muted?

[Lin Song, executive]

No. I'm good here.

[Lance Vitanza, analyst]

Okay. Did you guys get the question or should I repeat that?

[Lin Song, executive]

No, I think it's good. Okay. So no, I think it's good the melatonin the beginning, but I think maybe so maybe I'll comment a bit for the GX penetration and also be Brazil and then [indiscernible] for the unit numbers. So yes, so more like maybe starting with Brazil because it's actually quite interesting. I think we just commented that for GX, U.S., of course, is always our #1 market. But it's a good example that will also show very strong growth for Brazil as more like as an emerging market, but also it's a function that it's also one of the places where we see -- traditionally, it's counted as the emerging market and we see up not so high on [indiscernible]. But for GX, what were very interesting is that we see that it is gaming users. If it's from PC gamers very active, then they actually see that it's actually relatively high ARPU compared with other browsers. So I think -- so we highlight this to call out that in some instance, especially, I would say, in PC and in GX case, we actually see maybe less difference of user from different regions, but rather as far as their high ARPU users, for instance, they are gamers, they play with AAA games, then you actually see quite high ARPU across the regions. So I think we're excited to see that we have very good growth of GX growth in Brazil. And also it's proof, I would say, rather, that in the long run, perhaps more relevant is high ARPU users with high intent. We also see it as a trend in the industry and can even be less limited to a particular region. So I think maybe that's the commentary. That's the way you have here. And then maybe also to comment that -- but still, like all in all, in general, both, I would say -- in, let's say, high ARPU user market or that's the US -- the market, we are still in a single-digit market share, right? We still have plenty of room to grow. And overall, we're just very excited about the potential. It's more like, I would say, for certain products, which are already very high after [indiscernible], -- we also announced the GX app, right? I would say we probably have less focus on particular region and where we will come order you to growth both organically and also by marketing spend. So potential are huge. Well, way of course, these or other verticals will of course further more high value -- more like higher value markets like West markets.

[Lance Vitanza, analyst]

Okay. That's super helpful. And if I could just squeeze in one more question about capital allocation before I pass the baton here. And I heard the commentary about the dividend being the primary mechanism for returning cash to shareholders. And I think I know the answer to this, but there's a yield on the stock, a 7% dividend yield that would seem to suggest that maybe the market sees potentially some downside risk to the dividend. And just to be clear, is there any reason to think that the dividend could actually be cut or lowered. I mean, it seems to me like the risk around the dividend is to the upside given you have no debt, you have strong margins. And even if growth were to begin to plateau, which it hasn't, it seems as though you're generating -- I mean, I think I have you at around $150 million of cash at the end of this year, even after you pay the public portion of that $0.80 dividend, right, because you still have some of the star maker receivable that you're working off, I believe?

[Frode Jacobsen, executive]

Yes, correct. Yes, I can try to broadly comment. I mean, yes, we seem to trade at a good yield. So good for our investors. We -- the business is scaling. We are converting cash -- sorry, profitability to cash, I think, in a healthy manner. I would also end up with a calculation of increasing cash, also taking into account our new license data center for the year, though. So we -- obviously, we have -- we'd like to be more textbook. And we just launched this recurring dividend. But over time, of course, we would like to be in a position where we can increase it and certainly not decrease it.

[Operator]

And we'll take our next question from Eric Sheridan with Goldman Sachs.

[Eric Sheridan, analyst]

Two, if I could. First, coming back to the comments about Apple and opening up broader competition. How should we think about what that means for growth in the business, not only in 2024, but against a longer-term time horizon and how you're thinking about incorporating that into forward forecast? That would be number one. And then number two, obviously, nice leverage displayed both in the quarter and the way you're framing margins for '24. Can you talk a little bit about balancing what's your key investments are for '24 against delivering against that type of operating leverage.

[Lin Song, executive]

Yes, Charles. So I guess I thought, this is Lin. I want I'll just take Apple on because I like it. So no, I think -- so in general, I think it's still at all the states, right, because it's more like it's a function of regulatory changes. I guess everybody sees -- yes, the motions will be to some of the pressures from EU DMA app that we see Apple now starting to open up, right, trying to say that they now allow potential the third-party browser engines in our case, to be available on Apple even though there are still a lot of conditions that we need to iron out, right? So I would almost say everyone know that in Western market or high upmarket, Apple has a significant market share, and that has been rather than in case because parted browser they simply do not allow a browser engine at all, right? So I don't know if many people realize that from the beginning, they never allow it, which is rather strange. So I would almost say that I think now we have this for the right move that list that's opening up that potentially can allow us to compete in the same level as say, Android, which is now about maturity of the mobile smartphone base simply because we can then have our own engine. So I think that's definitely the right direction. There's still work to do because I think even -- yes, we also have a good talk with Apple and they may not lost still iron out the whole process. And with all you know -- because now it's also limited to the EU, which is a bit strange. Likewise -- why would you have something which is only -- okay in Europe not other place? So, we need to arrive a lot of details also in very good experience and partnership with Apple and the likes. But we like the movement and the directions, and we are very actively working on it. I do think that we will have higher growth in SCI any case. But of course, again, it depends on a few of other stuff that we're actually actively working on. So yes, so I think that's my short one answer. But then maybe Frode can comment a bit on capital allocation ago?

[Frode Jacobsen, executive]

Yes. Sure, Eric. So I mean, we -- our underlying trend is a margin expansion as we scale -- and then when we look at the 2024, we set our guidance based on sort of that normalized trend of that scale. So I think we guide about point or so percentage points ahead of consensus, given that we have scaled very strongly in the fourth quarter. The fourth quarter alone lifted EBITDA margin of 2023 by an entire percentage point relative to what we guided for the quarter ahead of time. So we certainly came in ahead of expectations throughout the year, including in the final months of the year because if you look back, remember our original margin expectation for 2023 was 20% EBITDA. So we continue to scale it, but we also invest in growth in our marketing when we see healthy ROI, and we have been stepping that up in dollar terms quarter-by-quarter, and we do want to continue that trend.

[Operator]

And we'll take our next question from Naved Khan with B. Riley.

[Naved Khan, analyst]

Great. On the iOS topic, I'm curious if you -- if you plan to do any advertising to drive up awareness for Opera as this change goes into effect on March 7, so that you can get more downloads. Any color on that? And then I have a follow-up on the Ad extension. Are you seeing any increased interest because of the upcoming cooking depreciation and Chrome browser and how you kind of offer a closed-loop system for the advertisers?

[Lin Song, executive]

So okay. Yes, this is Lin. I think I'll comment a bit in the start and then after my colleague for more details. So yes, I think you probably referred to the potential ballot screen and others allowing you to choose at least of cross from yes, when the on the phone when you're seeing new amount. So I would say, yes, I think we will definitely -- we're probably looking at more marketing budget, I agree because it's a good timing. But then maybe just to point out that, of course, for us, when more looking also for into the capability of be able to have independent browser engine because that actually well will make more differentiation. And that will take more time simply because Apple will yes, there's a lot of limitations technically that Apple it's not very -- still not very clear yet. How that pans out, so we need to work on that. But yes, high level, I think it does make sense to have higher marketing spend and we're looking forward to it to actually further increase our RS market share. So is that -- and then also maybe comment a bit on the ad, yes, yes, we do see that web traffic is quite relevant to us as a platform, just because we browser are quite natural into this. We have all the four-party data, and we're not really impacted by cookies on your traffic and Atos. So yes, we do -- we already see a good trend that we see picking up of web traffic, perhaps more than anything else in Q4, and we think that will continue in Q1, and we'll focus on that as well. So it's probably going to be a bit a tailwind or good advantage for us will be forward.

[Operator]

And we'll take our next question from Alicia Yap with Citigroup.

[Alicis a Yap, analyst]

Also congrats on the solid quarter. I have a few questions. First is following up on the Brazil GX browser with the lessons learned from Brazil, would that lead you to think about also launching in other markets? If so, where could that be? And then second question is just wondering if there's any initial target that on the revenue contribution or incremental revenue contribution that can be coming out from the Aria integration later this year? And then last question is, given you will continue to grow the high-value, high ARPU users on your platform, what kind of potential new advertiser industry vertical or category that you believe you could attract that has not been already on your platform?

[Lin Song, executive]

Yes. Okay. So yes, okay. Like again, so we all know, I'll turn down the call and then further, please Chime in, and I'll try to be brief. So, yes. I think GX especially is available worldwide. We don't really have too much limitations on regions. But then you are right that the content cost of GX can be different across regions because of languages, news, interests on others. So yes, there are a bit localization needed and a bit localized focus, which, as you are rightly saying that we have -- like we post for U.S. and other European countries. But now we're also expanding into LatAm, in particular, Brazil, which works really well. So I think naturally, we will want to expand more into LatAm. Yes, into relevant regions and then there's also other similar regions which we can look at. So I think the focus is naturally that we want to target and region countries where there is a big penetration of gamers, especially PC gamers because that very relevant product for GX. So I think that's in how we look at it. And I think it will continue to see the nice expansion of the GX-based which, again, is a very nice revenue driver and it's profitable from day 1. So very excited about it because that actually will mean more profit margins hopefully. And then I think you also commented about Aria and its contribution to revenue, I guess. So like again, it's still for totality, it's still a bit of a stage. But I would say that, first of all, of course, it does bring a wellness and say we have grown very nice people offer on our flagship product because of AI -- because people put a lot focus on it. They see that they can be differentiated. But then on top, if looking at revenue point of view in many regions, you probably can already see that now the AI or Aria chain has not already included monetizing, if you click on it, if you take it to a web page and where you get monetized bushels. So I think that's a very good example of how that can be monetized even though we're all working, of course, with our partners because it's very important that they are also on the board duly how we should design the model for a lot. So it's that -- and then again, not limiting to link, it doesn't mean a recommendations of hotel and may not lost which we are very excited about with our partners experimenting. So like [indiscernible], a very nice way of monetized very easily conceivable. And the only thing is just we are to see almost a bigger change in the industry, and we want to work very closely with our partners to do that in the right way. So it's that. And then I think -- what's the last question again?

[Alicis a Yap, analyst]

If you continue to grow the high value, high op user, any like new advertiser industry vertical that you haven't been on board we can able to attract.

[Lin Song, executive]

Yes? Yes. Yes. Sorry, I don't have a note. So yes, I forgot this one. Okay, sure. So yes, I mean, I think it's a quite interesting because in Q4 alone, we already see that e-commerce really standing out. But I would always say that it's really -- it's a bit different than what we've seen in the past that now we see that e-commerce vertical with a very specific high user intent is very relevant. Like instead of generic banners showing, hey, you can buy these goods or that. We see that now we can do more, I would say, focused on high-intent use events like and a point where you don't want to check out. We say, "Hey, do you have a coupon called, "Hey, maybe you want to have check this cash back. And those actually works really well. We are experimenting with some of our U.S. partners -- so very excited about it. I think that's definitely a new trend that we see that we focus on high intense event and then we'll make -- I never try to commercialize it, but also we give very good user value because very appreciative because that gives them value write-down spots. So I think similar styles that may be potentially lower frequency, they're very high-value events with good user intent, e-commerce but it can also potentially be Fintech finance, credit card application or whatever can be quite relevant. So those we are very excited about the potential of new verticals.

[Frode Jacobsen, executive]

Maybe I could just comment on your second question in terms of guidance. So I would say, we do reflect the fact that Aria helps us raise awareness and so it helps us attract high-value users, and we see that it's also very engaged users that we monetize well in our existing monetization directly. So that's how we consider it for now and an incrementality -- we are more cautious to build in since it's still so new.

[Operator]

[Operator Instructions] Our next question from Mark Argento with Lake Street.

[Mark Argento, analyst]

Just a couple of quick ones here. So Sang Lin, I know in your prepared remarks, you talked a little bit about search, continue to see decent strength there. I think it grew 15%. But you did mention that you thought you could grow in excess of the search market. Just wanted to drill down there a little bit is AI, the core contributor there? And then just one for Frode on the OPay big reval up on the stake with the recent investment. Did you guys get a look at the opportunity to sell secondary shares in that transaction or what's the probability we can see a monetization there? And then if you do monetize any kind of [indiscernible] of proceeds.

[Lin Song, executive]

Yes. Okay. So yes, I'll brief the comment. And yes, Frode can also value comment a bit on the crest. So I guess when we refer to such, I think it's really a function of number one, we do have like for instance, we work closely with allocations, we like to Google and the like. And then in fact, of course, has been at we do have the higher such growth because we're benefiting from not only the revenue growth in this case, similar as Google, but we do also have more user growth, perhaps it is because we are starting from a much smaller point like way especially in high-aftermarket -- so I think that's really just explained why. We do have higher search revenue growth than, say, the bigger market, right? But if you compare us with Google like. So that's one. And then, of course, we're also quite excited about the future because -- I think mainly because we are very positive about our potential user growth. And then I also great you that with the incorporation of AI, it can actually make us more efficient, more such discoverable and then they can lease perhaps the shortage, the such results which more likely. We really hope that can also bring more revenue stream from that. And if we can also be innovative on that. But again, we are working very closely with our partner on that because I think it's very important that this is core airport.

[Frode Jacobsen, executive]

Mark, I can comment on the OPE part of the question. So I think based on the result of 2023, we can say we are happy we haven't sold out yet. We didn't monetize the stake a couple of years ago, but still a significant position. At the same time, it's not part of our business is we don't have any operational synergies really as an investor. So it's a long-term view, we do want to exit the position. But there's no real necessity of a set time line. So I think we'll consider it and treat it in an opportunistic manner. And then as I mentioned on the call, whether that ultimately becomes a sale or an exit via an IPO. That's how we see it long term. But we don't have a time line that we, for some reason, must adhere to.

[Operator]

And it appears that 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, executive]

Sure. Okay. So. Like again, I really appreciate that you could join the call on the conclusion. We think that 2023 was a terrific year for Opera, the top line growth and adjusted EBITDA margin expansion we experienced combined with the best product for the file our history, sets us up for continued success in 2024. So really looking forward to it. And I would also like to thank all of you, our employees for their hard work and our investors for your confidence in us. Thank you for it.

[Operator]

And this does conclude today's program. Thank you for your participation. You may disconnect at any time, and have a wonderful day.