"Revenue jumped 68% year-over-year to $585 million, beating analyst estimates by a wide margin. Advertising, which makes up the bulk of its business - it now accounts for 94% of total quarterly revenue - surged 74% to $549 million, driven by new ad formats and better targeting. Daily active users hit 116 million, up 19% from last year, with U.S. growth at 7%. Average revenue per user climbed 41% to $5.04, showing stronger monetization."
"Even the "other revenue" segment, mainly from content licensing deals with AI firms like Google and OpenAI, grew 7% to $36 million. These results highlight Reddit's ability to capitalize on its community-driven platform in a competitive social media landscape. Since Reddit went public in March 2024, I have been very skeptical of its stock as an investment, especially doubting its ad business as a reliable growth driver. Here's why I got it so wrong."
Reddit's third-quarter revenue increased 68% year-over-year to $585 million, driven chiefly by advertising which comprised 94% of quarterly revenue and rose 74% to $549 million. Daily active users reached 116 million, up 19% year-over-year, with U.S. growth of 7%. Average revenue per user rose 41% to $5.04, indicating stronger monetization. Other revenue, primarily content licensing with AI firms like Google and OpenAI, grew 7% to $36 million. Logged-in user growth accelerated to about 30%, aided by personalized feeds and subreddit recommendations, while content licensing deals expanded materially.
Read at 24/7 Wall St.
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