Reddit posted strong quarterly results, with a loss per share of $8.19 compared to an expected loss of $8.71 per share. Revenue came in at $243 million, beating expectations of $212.8 million. Revenue increased by 48% compared to the previous year, with ad revenue seeing a 39% year-over-year growth rate, outpacing its competitors.
Digital advertising companies have been experiencing healthy growth, with Meta, Amazon, and Google all reporting increases in ad revenue. Reddit reported a net loss of $575.1 million, primarily due to stock-based compensation expenses and IPO charges. For the second quarter, Reddit expects revenue of $240 million to $255 million, surpassing analyst expectations and indicating a growth rate of about 32%.
Reddit, founded in 2005 by Alexis Ohanian and Steve Huffman, has seen significant growth in its user base, with 82.7 million daily active users in the first quarter, higher than expected. The company began trading on the New York Stock Exchange in March under the ticker symbol “RDDT” with an IPO price of $34 per share, valuing the company at around $6.5 billion.
Following the release of its quarterly results, Reddit’s stock price surged in after-hours trading, reaching over $58. Average revenue per user increased by 8% to $2.94 compared to the previous year. Reddit will hold its first quarterly call with investors to discuss the results and outlook for the future.
CEO Steve Huffman expressed optimism about the company’s future, calling it the beginning of a new chapter for Reddit as they work towards building the next generation of the platform. The company’s growth and financial performance demonstrate its ability to compete in the digital advertising market and attract a growing user base. With strong revenue numbers and user growth, Reddit appears to be on a positive trajectory as it continues to evolve and expand its platform.
