Reddit Narrows Losses as Revenue Surges on Advertising Growth

Reddit (RDDT) beat analysts’ expectations on the top and bottom lines in its second quarterly earnings report since its March initial public offering (IPO).

The social media platform reported second-quarter revenue of $281.2 million, up 54% year-over-year and above estimates compiled by Visible Alpha. Reddit’s loss of 6 cents per share narrowed from 70 cents a year ago and was a fraction of the 32 cents per share analysts expected. 

Advertising Revenue Jumps 41% From a Year Ago

Reddit said its advertising revenue jumped 41% year-over-year to $253.1 million, while other revenue increased nearly eight-fold to $28.1 million.

Daily active users grew 51% to 91.2 million, with average revenue per user landing at $3.08. Analysts had called for DAUs of 85.5 million.

Looking ahead, Reddit projected third-quarter revenue of $290 million to $310 million, above the analyst consensus of $283 million. 

Reddit shares were down 3% at $52.70 in extended trading Tuesday as of 6:10 p.m. ET following the company’s earnings release, though even at that level, they’ve gained 55% from Reddit’s IPO price of $34.