Prediction: Reddit Will Be a Millionaire-Maker Stock | The Motley Fool
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Prediction: Reddit Will Be a Millionaire-Maker Stock | The Motley Fool
"Reddit went public in 2024, nearly 20 years after the social media site launched. The company has been slow to monetize its massive user base, but that effort is now kicking into high gear. Reddit generated $465 million in revenue from advertising in the second quarter, up 84% year over year, as it grew its user base and invested in its advertising platform."
"What makes Reddit special in the world of social media? Users turn to Reddit to find answers, product recommendations, and other information rather than to search engines. Out of Reddit's 416 million weekly active users in Q2, 70 million searched directly on Reddit, and 6 million used the company's artificial intelligence (AI)-powered Reddit Answers feature. Countless more undoubtedly tacked "reddit" onto their Google search query, knowing that Reddit would provide better information than generic search results."
"Advertising is the main way Reddit generates revenue, and so far, filling the platform with ads hasn't driven users away. The number of daily active users jumped 21% year over year in Q2 to 110.4 million, with 11% growth in the U.S. and 32% growth in international markets. Reddit is undertaking a machine translation initiative to appeal to non-English speakers, which is helping to drive international growth."
Reddit accelerated monetization after its 2024 IPO, generating $465 million in advertising revenue in Q2, up 84% year over year. Weekly active users reached 416 million, with 70 million searching directly on Reddit and 6 million using AI-powered Reddit Answers. Daily active users grew 21% to 110.4 million, including 11% U.S. growth and 32% international growth aided by a machine translation initiative. Advertising remains the primary revenue source, and a newly launched shopping ads unit has doubled advertisers' return on ad spend while quadrupling the number of hosted product catalogs, indicating substantial commercial upside.
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