Key Takeaways
- Reddit shares soared in extended trading Tuesday after the company released its first quarterly earnings report since it began trading in March.
- The social media company’s first-quarter revenue was $243 million, a 48% increase from the year-ago period, while ad revenue increased 39% year-over-year to $222.7 million. Both exceeded Bank of America analysts’ expectations.
- Reddit’s net loss of $575.1 million widened from a year ago, “driven by IPO charges.”
- Reddit also reported record user traffic, with daily active unique user numbers growing 37% year-over-year to 82.7 million, topping Raymond James analysts’ estimates.
Reddit (RDDT) shares soared over 13% in extended trading Tuesday after the social media company reported record user traffic and rising revenue in its first quarterly earnings report since its initial public offering (IPO) in March.
The company’s revenue for the first quarter of 2024 was $243 million, a 48% increase from the year-ago period. Ad revenue increased 39% year-over-year to $222.7 million. Both figures were above Bank of America analysts’ expectations of $212 million and $199 million, respectively.
Reddit reported a net loss of $575.1 million or $8.19 per share, widening from a loss of $60.9 million or 1.05 per share in the first quarter of 2023, “driven by IPO charges.”
The company also reported record user traffic, with daily active unique users (DAUq) jumping 37% year-over-year to 82.7 million, ahead of Raymond James analysts’ expectations.
“It was a strong start to the year and a milestone quarter for Reddit and our communities as we debuted as a public company,” Reddit CEO Steve Huffman said, adding that “we see this as the beginning of a new chapter as we work towards building the next generation of Reddit.”
The social media company said it anticipates revenue for the second quarter to be between $240 million to $255 million, with adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) in the range of $0 to $15 million, compared to the $10 million it reported in the first quarter.
Reddit’s stock price was up more than 13% at $55.90 in extended trading as of 5 p.m. ET Tuesday, an increase of about 64% from its IPO price of $34.