Reddit surprised Wall Street with strong revenue growth and improved profitability forecasts, impressing investors with its first earnings report since going public.
Revenue for the first quarter was $243 million, surpassing estimates and showing a 48% year-over-year increase, with a significant portion coming from ad revenue.
Reddit's net loss was attributed to stock-based compensation expenses related to its IPO, while its revenue growth outpaced competitors like Meta, Amazon, and Alphabet.
Analyst Mark Shmulik noted that Reddit exceeded bullish expectations, benefiting from a strong digital ad market and increased traffic, potentially due to effective IPO marketing.
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