On March 21, 2024, Reddit CEO Steve Huffman stood on the floor of the New York Stock Exchange (NYSE) and struck the bell for the NYSE’s initial public offering (IPO). shares, pricing its shares at $47.
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Reddit Shares of the social media company rose 22% in after-hours trading on Tuesday, topping $100 for the first time, after the social media company reported third-quarter results that beat analysts’ expectations and issued an upbeat forecast for the period.
Here’s how the company performed compared to London Stock Exchange Group forecasts:
- Earnings per share: 16 cents vs expected loss of 7 cents
- income: $348.4 million Expected to be $312.8 million
Reddit said fourth-quarter revenue would be between $385 million and $400 million, beating analysts’ average estimate of $357.9 million. Fourth-quarter adjusted earnings will be between $110 million and $125 million, above the average estimate of $85.2 million.
In the third quarter, revenue increased 68% year-on-year, and the company turned a profit with a net profit of US$29.9 million, compared with a net loss of US$7.4 million in the same period last year.
The company said its daily active users rose 47% year over year in the third quarter to 97.2 million, beating analysts’ expectations of 96.5 million.
Average revenue per user in the third quarter was $3.58, exceeding analysts’ expectations of $3.24.
“It was another strong quarter for Reddit and our community as we achieved important milestones, including reaching new levels of user traffic, revenue growth and profitability,” Reddit CEO Steve Huffman said in a statement. “Reddit remains one of the most visited and trusted websites in the world, and we have opportunities that most companies don’t have access to. “
This is Reddit’s third financial report since going public in March. The stock has nearly tripled in value since its IPO, according to after-hours action. As of closing, Reddit’s market capitalization was $13.6 billion.
Since last year, Reddit has benefited from Google search updates that have helped its content rank higher in search results, bringing a flood of new users to the 19-year-old social media service. However, what Reddit calls new users, or logged-out users, generate less online ad revenue for the company than logged-in users, who typically spend more time on the platform, Reddit detailed . financial reporting.
Huffman told CNBC in August that Reddit was trying to get users who weren’t logged in to sign up for the service and make it easier for them to do so. He also said Reddit’s direct traffic is “very resilient” to any changes in Google searches.
The company said that global logged-out users increased by 70% year-on-year to 53.1 million, while global logged-in users increased by 27% to 44.1 million.
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