Thanks for joining us. With me today, I have our CFO, Frode Jacobsen; and our COO, Song Lin. Before I hand over the call to Frode, 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 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 and adjusted net income, which are different from our consolidated financial statements that are prepared and presented based on IFRS. We believe that the use of these non-IFRS financial measures provide 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. Reconciliations between IFRS and non-IFRS metrics for our reported results can be found in our press release that was issued earlier today, a copy of which is on our Investor Relations website. Finally, we will be launching our business blog soon. Its focus will be to provide more color and updates related to our efforts and initiatives, current topics and to provide more access to our broader leadership team. Hopefully, this is something you’ll check out once it goes live, and we plan to publish content on a frequent basis. With that, let me turn over the call to Frode. Frode?

Thanks, Derrick, and hello, everyone. In times like this, it’s a privilege to be part of the company whose products and services are in more demand than ever. We have never before seen more users of Opera News or of our PC and newer smartphone browsers. Our job is to manage for the near-term implications that the COVID-19 pandemic has in our business, stay prudent, but at the same time, take advantage of our strong product portfolio, our financial strength and our brand assets and aim to exit this period on an even stronger trajectory than what we entered it with. In 2019, we grew our revenues by over 94%. And for 2020, we originally guided revenue growth of 63% at the midpoint, including $123 million to $133 million for the first quarter. As we shared with the market in April, we ended Q1 even ahead of this guidance as the COVID-19 impact came on late in the quarter. Song Lin will talk about our operations and how we continue to proceed full speed towards our ambitions. In parallel, we are balancing risk and reward and appreciate the uncertainties the pandemic brings with it. In anticipation of near-term challenges in key countries like India and Kenya, we significantly reduced our microloan volumes from mid-March. Further, as also shared with the market in April, we took an extraordinary additional loan loss provision at the end of the first quarter to capture a conservative view on repayment probabilities as our borrowers are affected by the various measures taken to halt the pandemic. For our browser and News business, as every other ad-based business model, there will be near-term monetization impacts, more visible in Q2 than Q1. However, we believe that COVID-19 has accelerated the underlying transition from offline to online in our…

Thanks, Frode, and hi, everyone. Just to echo Frode’s comments, I’m very pleased with how our employees and the company overall have navigated those unprecedented times. Our R&D efforts have continued more or less unaffected, and our products have never been more desirable. There is no better way to drive towards our long-term potential. Our commercial teams are working with additional customers that want to promote their services on our inventory and continue to take advantage of the accelerating offline-to-online transition; while our products link users with digital information, facilitate e-commerce and provide app-based, cashless fintech services. So while COVID-19 impacted us towards the end of the first quarter and also into the second, in both good and bad ways, our optimism around our long-term prospects is intact, and we believe that our focus on the facilitation of online content, commerce and transactions will serve us well. So with that, just let me now get into details. Our browser business continues to perform well and drive sustained growth. A large amount is due to our efforts to differentiate our products, which has become even more beneficial during this COVID-19 times. Beginning with PC, we have exceeded 73 million users in March, up 11% year-over-year to our highest level ever. Just to provide some context, we had about 44 million PC users in March 2017. And we are very proud that our continued product innovation has led to Opera being selected by many as an alternative to their default PC browsers. User engagement and use of the differentiated features like building chat has really spiked. Additionally, our gaming-specific GX browser continues to perform well above expectations, growing users by more than 80% sequentially in the quarter to exceed 3 million in March. We believe that our success with Opera GX and…

Thanks, Song. Let me get into details about the first quarter and provide an update on recent trends before we open up the call for questions. Opera delivered record first quarter revenue of $138.2 million, up 177% year-over-year and above our guidance range. Search revenue represented 14% of total revenue or $19.7 million, down 4% year-over-year. Obviously, search revenue was impacted significantly in the back half of March. Advertising revenue represented 12% of total revenue or $16.8 million, up 18% year-over-year, and similar to search, experienced significant headwinds in late March. Fintech revenue represented 69% of total revenue or $94.7 million. In spite of late March limitations, this revenue category increased 32% sequentially from the fourth quarter. Retail revenue represented 3% of total or $4.7 million. And the technology licensing and other revenue category represented 2% of the total or $2.4 million, in line with expectations as we are phasing out non-recurring revenue related to services provided to our – OPay. Total operating expenses were $116.9 million in the first quarter, and I’ll go through the main components. Compensation expenses were $20.5 million, down about $2 million or 9% versus the fourth quarter. The decrease was mainly due to a reduction in share-based compensation expense as well as certain limitations on in-market activities towards the end of the quarter. Marketing and distribution expense was $18.1 million, a slight increase of 3% versus the fourth quarter. Cost of revenue was $27.6 million. Within this, $20.3 million related to microlending, representing 21% of microlending revenue; $4.4 million related to retail; $1.3 million related to browser and news; and $1.1 million related to tech licensing and other revenue. Credit loss expense was $69.5 million and mainly related to microlending. This figure includes the extraordinary loan loss provision of approximately $27 million to address…

Thank you, sir. [Operator Instructions] I show our first question comes from Lee Krowl from B. Riley FBR. Please go ahead.

Great. Thanks for taking my questions and better one as well wherever you might be. I wanted to first start off on the lending business. It seems like some pretty solid growth and very well managed on the risk side of things. First question is just on revenue contribution from the newer product features. Was it material in the quarter? And I guess is that a product you offer to existing customers? Or are you targeting a different cohort with the buy now pay it later type functionality?

Hi, Lee. Thanks. This is Frode speaking. So I would say, broadening of the portfolio, we start to see transaction on it, but it wasn’t really a material part of the Q1 results.

Okay. And then you guys – you talked about saving roughly $20 million on the cost front. Is that imply that you still intend to invest about $10 million? Because I think the incremental expense previously was $30 million. Or is this $20 million in cost savings net of those growth investments?

Yes. So after potential savings, a very big component is actually that the unit economics of marketing and distribution is getting cheaper. So all else equal, we can maintain good volume for less. When it comes to the newer initiatives, I think as we’ve spoken about now, the ambitions for those are unchanged. There are some in-market limitations that can cause certain delays, and with that, there will also be some cost benefits. But for the most part, I would say it’s not a one-to-one with the overall savings and what we do on new initiatives. I think the bigger bulk is actually centralized costs, marketing and distribution.

And Lee, this is Derrick. The one point I would add to what Frode said is we’re trying to be more efficient with cost savings, and again, marketing was one. But on an overall basis, our focus is continuing to try to grow this business and continue to fund our initiatives so that we have a better chance for a good outcome.

Got it. And then just last question from me. I know, obviously, the world has changed since you provided guidance in February. But it seems like all else equal, the growth initiatives and new products remain on track for their scheduled launches. Would that imply that, that $10 million targeted revenue for the full year is still a target that’s achievable? Or is that unlikely, just given the macro backdrop?

We haven’t – so we’ve been cautious. We didn’t want to provide guidance yet for the remainder of 2020. So I would be a little a bit careful to comment on sort of specific components even. We – it’s a bit premature to conclude on that. We – the most important thing for us is how we managed to scale those operations, that we get them live and that we have a good run rate as we exit 2020 and into 2021. Whether that will be a sort of accumulated revenue impact of $10 million or if it will be a little bit less, too early to say right now, but the ambition is the same.

Got it. Thanks for taking my questions guys.

Sure. Thanks, Lee.

Thank you. Our next question comes from John Godin from Lake Street Capital. Please go ahead.

Yes. Thanks for taking my questions. I hope everyone is doing well. First, just thinking about India. As the government starts to loosen restrictions and open things back up a little bit, what are some of maybe the key milestones or trigger points that you’re looking for that would give you confidence to start kind of more rapidly going back into that market. And then second, just thinking about the competitive landscape. Obviously, the fintech space in both Africa and India is quite competitive. Have you seen anything changed there just due to the economic slowdown and maybe anything changing with some less capitalized competitors? Thank you.

Hi, John, I’ll go first. So India is interesting. They’re in lockdown 4.0, I guess, they call it, which is scheduled to end at the end of this month. It’s really moved – and it has already moved to quite state-by-state, as I mentioned, more local policies. So what was initially very strict is now becoming a bit more and more loosened up, I would say. So for example, we have – our offices there are now starting to reopen again. Initially, you can have 33% of capacity, and then you – we expect that to scale up. So – and I think that as an indicator of sort of the broader economic activity, which then, in the end, helps our users to get back to work and to get back to having an income, I think those are positive signs. When it comes to our scaling up again of that business, I think a key advantage that we have this year, which we didn’t have in 2019 when you could say we scaled that business for the first time, is that now we have a proven user base. So now we have millions of people that have taken loans and paid them back, and we have seen have used the service a bit like we would use a credit card. And sort of having that as a basis is very important for us as we scale it up. So we will definitely begin with, I guess, what we could call trusted users or proven users. And as always, as we did also in 2019, start off with smaller amounts and then scale it up from there. And I think these are considerations that we will do taking the local, let’s say, market and policy conditions into account, where we think it’s most sustainable to start scaling again. So that is a bit of the testing that we’re doing now and what we expect to be rolling out. When it comes to the broader landscape – yes, sorry, Derrick. Yes. Broader landscape, I’m not aware of any material – yes, we are a well-funded company, and we are a very solid company, and we will be there as the market picks up. I’m not aware of any sort of major problems for our competition there as of now.

John, this is Derrick. I would add one point. I think our view of where this business and the potential hasn’t changed. We expect to continue to scale our lending, and we expect to offer different products. And as Frode said, we’re testing. And once we feel comfortable that, as you said, with the smaller people that things have returned to normal, we can scale very quickly.

Thank you. I show our next question comes from Mark Argento from Lake Street Capital. Please go ahead.

I think John got most of our questions. So I’ll hop back in the queue. Thanks.

Thank you. I show our next question comes from Lance Vitanza from Cowen. Please go ahead.

Hi, guys. Thanks for taking my questions. I wanted to talk, I guess, about two areas, if I could, the search and advertising and then just your liquidity picture. But on the advertising side, and you talked about this a little bit, Frode, but could you review again a little bit, maybe in a little bit more detail, how your categories – how you index to categories that are poorly performing, like travel on the one hand, and categories like gaming that are – if anything, that are actually continuing to grow? Just trying to get a sense for how you stacked up relative to the overall contribution of these sectors to total advertising?

I understand. So I would say, important categories for us include e-commerce. It includes gaming, as you know, we even have a gaming browser. It includes travel, not so much flights, but more hotels and sort of local reservations. And it involves sports. And then I would say, let’s say, general mobile advertising overall as a representative of a large user base that we can market products to. So these verticals, they are affected differently. We see that e-commerce and even like content streaming and gaming verticals are on track to do quite well. And then we have others like travel that we expect will take longer to recover. And sports that have, of course, slowed down given the cancellation of events and so on, but it’s encouraging to see that some of the major European football events, for example, are starting to come back. So there, there could also be a question of whether we will see delays in revenue more than actual losses when we look at the year as a whole. But we haven’t given any public sort of splits between these verticals, and so I’d rather just focus on talking qualitatively about it.

No, that’s helpful. Actually, I appreciate it. So the search revenue, you mentioned, was down 4% for the quarter, but it was doing much better, obviously, through January and February. Could you sort of give us an idea of what that growth rate in search had been kind of as you started to kind of fall off into the crisis in March? And then – Bridged out to down 4% or was it less pronounced?

Yes. So I would say, we had our Q4 call in late February, and that’s when we gave our original guidance for 2020. So on that what we guided for 2020 was, of course, colored by what we were seeing at the time. And we guided search in sort of the mid-single digits, and we guided advertising to be higher than the 18% year-over-year growth we had seen in 2019.

Perfect. Okay. Maybe just moving to liquidity quickly. The liquidity and the cash plus marketable securities rose $35 million. I know that you have the cash flow statement. I haven’t been able to sort of sift through that in much detail, but it looks like the big driver there was just the shrinking of the loan book, which I suppose is now pretty much as it’s kind of – at a sort of a trough level. So as we think about cash flows in the second quarter, probably won’t see a big increase from additional shrinking of the loan book. What other factors should we think about as we kind of contemplate your ability to continue generating cash over the balance of the year?

So maybe first to speak to Q2. We had an operating cash flow of $51 million, as you mentioned. Of that, $48 million came from conversion of short-term loans to cash as we were scaling down that business and limiting our credit exposure. When – and then you asked when we look ahead. So I mean, as a starting point, for Q2 on the microlending side, as we mentioned, we had severe – so far in Q2, we’ve continued our restrictions on our microlending business. As I mentioned earlier, of the – we ended Q1 with a loan book of $45 million. So far in Q2, we have collected $43 million, indicating that we may have been a bit too restrictive as we closed the loss provisions for Q1. But we’ve had continued strong conversion of outstanding loans to cash in the second quarter, which will also benefit our Q2 cash flow. I’ll be sort of careful to guide cash flow for sort of the remainder of the year, but at least, I wanted to point out those.

Yes. No, thank you for clarifying that. So basically, so another big cash inflow from continued monetization of those loans in this quarter. And then maybe just lastly for me, and I know nobody has a crystal ball here, but if you just think qualitatively about sort of the outer years, 2022, 2023, et cetera, have you – and you think about the impact from COVID over the longer term, I’m just trying to understand whether we think COVID is it a onetime hit, what the "new normal" looks like for both – or for all of Opera’s businesses? And how long it takes to get to that new normal? Should we be thinking about the business having been impaired or augmented in any way? Or is it just it was a blip and we go back to where we were?

So we tried to get to some of that on this call. It’s an area that while it’s given us some short-term challenges, we’ve had to modify a bit our approach with our fintech business in particular. The other things happening is something that is quite exciting. The fact that our user base is growing really well and that we’re seeing that more and more people are both trying our browsers, that Opera News has really become a true hub for content and information and entertainment in the markets where we focus is, is something that to us – that’s why we said in there that we believe our long-term potential is at least as good as it was before the COVID-19 situation came around. So that actually carries with it some promise and some additional upside that we hadn’t expected. When it comes to sort of like the track from here towards normalcy, as Derrick also mentioned, we’re ready to scale up very quickly on the microlending and the broader fintech side. That’s a bit different than the other ones because it’s actually – demand is super high. It’s just us limiting it because we’re not – we haven’t been comfortable so far in Q2 with the risk profile. And I think on the advertising and search and the verticals that I just went through, of course, we’ll follow the market. We expect monetization will come back. There could be – but we’ll be careful not to be too enthusiastic, but the fact – I mean this can also represent an additional accelerator on the shift from offline to online that can be positive for us as we look ahead.

Okay. Thanks so much for answering the questions. Take care.

Thank you. [Operator Instructions] I show our next question comes from Alicia Yap from Citi. Please go ahead.

Good evening, good morning and afternoon, management wherever you’re. Thanks for taking my question. So given the strength in the user traffic that we are seeing in the Opera News and the search, how will that translate in the advertising dollars in coming months, right, after we come out from the COVID impact? And I guess gaming, e-commerce and some of the digital content might actually be benefiting. So have you seen some of that actually come along with our traffic strength? And related to the guidance, I understood you withdrawing that. But could you give us a little bit color in terms of the second quarter, in terms of the magnitude, right, of the sequential growth rate? How should we think about on the search business, on the Opera News business? I know on the fintech side, it’s probably a material decline. But then on the ad side, given we are benefiting from vertical like gaming and e-commerce. So any colors on just the magnitude of the sequential trend would be helpful. Thank you.

Yes. So it’s Song Lin here. I think I’ll just try to chime in a bit just on some of the categories that you mentioned. So I mean I think high level, what you’re saying is true that I think we basically – we share the view that the growth that way we see that’s impacting on desktop, which is really good growth and also the growth with the News, we believe that it’s definitely sustainable even after the COVID time is passed. And also like maybe also just to be capture on what Frode saying before that we feel that, yes, we definitely see some behavior changes, a bit long-term behavioral change or structural change on those deals, and largely, I think because we are mostly online, we are almost like a typical example of online company, we don’t have any offline that this is exactly beneficial to us. So I give you a bit more detail that, for instance, we see that e-commerce, as we said, are actually growing for some of our partners even in Q2, right, which is a worse time. And we think that will stay because once people are getting used to buy it in all place, I think we’ll see that trend will continue. And a bit same as gaming, maybe even more with gaming that when they are getting used to actually play games inside the browser, then we think that there’s a good chance. So that grows very nicely. And maybe also add a bit color into News, right? I think despite of a general Q2, of course, is going to be tough for the whole ad business, not only us, but for the whole industry, News – app monetization on News is actually relatively stable. Why? Just because such a…

Okay, thank you.

Thank you. This concludes our Q&A session. At this time, I’d like to turn the call over to Mr. Frode Jacobsen, CFO, for closing remarks. Please go ahead.

All right. Yes, I guess that wraps up our call for today. Special times, but as we’ve talked about, we are quite pleased with how we have navigated that so far and quite excited about the long-term opportunities that we are working towards these days. So thank you all for joining us on this call, and have a great rest of the day.