Reddit is set to report its earnings with expectations high after a 300% gain since its IPO. As of recent trading, shares increased 2% to $219.55, with a year-to-date rise of 34%. Strong advertising revenue growth and partnerships, including one with Intercontinental Exchange, have driven this momentum. Analysts project earnings of 25 cents per share on $405 million in sales for Q4, reflecting continued growth but a slight deceleration. Jefferies analyst John Colantuoni remains bullish, anticipating growing ad revenue driven by increased performance products and small business growth.
Expectations are high ahead of the report, with analysts projecting Reddit will build off a Q3 that was its first profitable quarter as a public company.
Strong ad checks support a potential 5th straight acceleration in advertising revenue, driven by faster growth in performance products and small/mid-sized customers.
Colantuoni rates Reddit stock a buy, believing the company can accelerate its advertising sales from the 56% rate posted in the previous quarter.
We expect ARPU (average revenue per user) to remain the key driver of faster growth, underscoring Reddit's nascent opportunity to close the monetization gap to peers Pinterest/Snap.
Collection
[
|
...
]