Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $392 million, up 61% year over year, marking the third consecutive quarter of growth over 60% [9][20][32] - Adjusted EBITDA reached $115 million, with a margin of 29%, up over 2,500 basis points year over year [32][33] - GAAP net income was $26 million, translating to $0.14 per basic share and $0.13 per diluted share [41][42] - Operating cash flow exceeded $100 million for the first quarter, ending at $128 million, the highest ever [34][40] Business Line Data and Key Metrics Changes - Advertising revenue grew 61% year over year to $359 million, driven by broad-based strength across objectives, channels, verticals, and geographies [20][21][32] - Other revenue, including data licensing, reached $34 million, growing 66% year over year [35] - The total number of active advertisers grew over 50% year over year in Q1 [22] Market Data and Key Metrics Changes - U.S. ad revenue grew 56% year over year, while international ad revenue grew 83% year over year, the fastest growth rate in three years [23][35] - Daily active users (DAUs) reached 108 million, and weekly active users (WAUs) reached 401 million, both up 31% year over year [9][53] Company Strategy and Development Direction - The company aims to enhance its core product and advertising business while focusing on international expansion and improving user experience [15][19] - Key initiatives include upgrading search functionality, expanding machine translation, and enhancing community engagement tools [14][15][17] - The company is committed to maintaining its unique community model and not imitating other platforms [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by macroeconomic conditions but expressed confidence in Reddit's ability to grow through uncertain times [10][51] - The company expects revenue for Q2 2025 to be in the range of $410 million to $430 million, representing 46% to 53% year-over-year growth [41][42] - Management emphasized the importance of community and knowledge sharing as core to Reddit's value proposition [6][12] Other Important Information - The company is focused on minimizing dilution, with total diluted shares falling to 206 million in Q1 [34] - The integration of AI and machine learning into advertising solutions is a priority, with significant improvements in conversion and click volume [25][27] Q&A Session Summary Question: How is the Reddit team protecting data quality from fake accounts or bots? - Management acknowledged the importance of authentic content and is actively working to prevent abuse and manipulation on the platform [43][44] Question: What is the current state of the advertising market and its impact on the business? - Management noted that while there is uncertainty in the market, they are well-positioned and delivering profitable outcomes for customers [51] Question: How does the company view user growth for the remainder of the year? - Management reported a strong start to the year with DAUs growing in the high teens range year over year, despite expected bumps from Google algorithm changes [53][55] Question: Can you discuss the drivers of pricing and ROAS compared to other platforms? - Management indicated that pricing is an outcome of supply and demand, with improvements in outcomes leading to increased advertiser spending [62][68] Question: What are the trends in contribution rates as the user base grows? - Management highlighted efforts to improve user experience by ensuring new users understand community rules, which has positively impacted contribution rates [79] Question: How does the company view the sustainability of current data licensing revenue? - Management expressed confidence in the value of Reddit data for search and AI companies, indicating a strong ongoing demand [84] Question: How does Google treat machine-translated content? - Management confirmed that Google supports their use of machine translation, which has been beneficial for indexing more user-generated content [90] Question: Why not invest more given strong revenue growth? - Management emphasized a disciplined approach to cost growth, aiming for revenue growth to outpace cost growth while still making strategic investments [92][96]

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was $392 million, up 61% year over year, marking the third consecutive quarter of growth over 60% [8][19][30] - Adjusted EBITDA reached $115 million, with a margin of 29%, up over 2,500 basis points year over year [32][34] - GAAP net income was $26 million, or $0.14 per basic share and $0.13 per diluted share [41][42] - Operating cash flow exceeded $100 million for the first quarter, ending at $128 million, the highest ever [34][40] Business Line Data and Key Metrics Changes - Advertising revenue grew 61% year over year to $359 million, driven by broad-based strength across objectives, channels, verticals, and geographies [20][30] - Other revenue, including data licensing, reached $34 million, growing 66% year over year [34] - The total number of active advertisers grew over 50% year over year in Q1 [22] Market Data and Key Metrics Changes - U.S. ad revenue grew 56% year over year, while international ad revenue grew 83% year over year, the fastest growth rate in three years [23][35] - Unique weekly users reached 401 million, and daily users reached 108 million, both up 31% year over year [8][19] Company Strategy and Development Direction - The company aims to enhance its core product and advertising business while focusing on international growth and improving user experience [12][14][19] - The strategy includes becoming a truly global platform with machine translation available in 13 languages and focusing on community-driven content [14][16] - The company is committed to maintaining its unique community model and improving user engagement through product enhancements [17][18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the uncertainty in the macro environment but expressed confidence in the company's ability to deliver profitable outcomes for customers [50][51] - The company expects revenue in Q2 2025 to be in the range of $410 million to $430 million, representing 46% to 53% year-over-year growth [41][42] - Management emphasized that Reddit's unique value proposition lies in authentic human answers, which the company is focused on preserving [43][44] Other Important Information - The company is investing in hiring and technology, particularly in sales and engineering, to support growth [37][38] - The company has over $1 billion in cash, allowing for potential future investments [92] Q&A Session Summary Question: What is the current state of the advertising market and its impact on the business? - Management noted that while there is uncertainty in the market, they are well-positioned with their roadmap and are delivering profitable outcomes for customers [50][51] Question: How is user growth expected to trend for the remainder of the year? - Management reported that daily active users were growing in the high teens year over year and emphasized that short-term bumps do not affect long-term strategy [55] Question: Can you discuss the drivers of pricing and how it compares to other platforms? - Management indicated that pricing is an outcome of supply and demand, and they are competitive in delivering market outcomes for advertisers [63][64] Question: What is the status of the Answers feature and its integration into Reddit? - Management shared that Answers has reached 1 million weekly users and is being integrated into the core search experience [66][68] Question: How are contribution rates trending with user growth? - Management highlighted efforts to improve contribution success rates for new users, which enhances the overall user experience [75] Question: How does Google treat machine-translated content? - Management confirmed that Google supports their use of machine translation, which helps increase user-generated content in more languages [86][87] Question: Why not invest more given strong revenue growth? - Management stated that they aim for revenue growth to be twice as fast as cost growth and are focused on sustainable investments [88][92]

Exhibit 99.1 Reddit Announces First Quarter 2025 Results Daily Active Uniques ("DAUq") increased 31% year-over-year to 108.1 million Revenue grew 61% year-over-year to $392.4 million Gross margin expanded year-over-year to 90.5% Net income of $26.2 million, 6.7% of revenue. Diluted EPS of $0.13 Adjusted EBITDA of $115.3 million, 29.4% of revenue 1 Operating cash flow of $127.6 million. Fully diluted shares of 206.0 million, down sequentially SAN FRANCISCO, Calif. – May 1, 2025 – Reddit, Inc. (NYSE: RDDT) to ...

Core Insights - Reddit's first-quarter earnings exceeded Wall Street expectations, with revenue rising 61% year over year and net income of $26.2 million compared to a net loss of $575.1 million a year ago [1] - The company provided optimistic second-quarter sales guidance of $410 million to $430 million, surpassing analyst expectations of $396 million [1] - Reddit's daily active uniques (DAUq) increased by 31% year over year to 108.1 million, exceeding analyst expectations of 107.3 million [2] Financial Performance - First-quarter revenue was reported at $392 million, beating expectations of $370 million [7] - Earnings per share were 13 cents, significantly higher than the expected 2 cents [7] - The company’s net income improved from a significant loss in the previous year, indicating a strong recovery post-IPO [1] User Growth and Engagement - Global logged-in DAUq rose 23% year over year to 48.7 million, while logged-out DAUq increased by 38% to 59.4 million [4] - The increase in users is attributed to changes in Google search algorithms and site improvements aimed at converting logged-out users to logged-in users, which are more valuable for advertising [3][4] Market Context - Reddit's performance is set against a backdrop of macroeconomic challenges, with the CEO noting that such environments create both challenges and opportunities [1] - Other companies in the industry, such as Meta and Snap, are also facing varying degrees of macroeconomic headwinds, indicating a broader trend affecting digital advertising [5][6]

Core Viewpoint - Reddit (RDDT) is expected to report first-quarter 2025 results with projected revenues between $360 million and $370 million, indicating a year-over-year growth of 48% to 52% [1]. Revenue and Earnings Expectations - The Zacks Consensus Estimate for first-quarter revenues is $372.09 million, reflecting a year-over-year increase of 53.15% [1]. - The consensus estimate for earnings is 3 cents per share, which has increased by a penny in the past 30 days [1][2]. Performance Influencing Factors - Reddit's first-quarter performance is anticipated to benefit from the expansion of its advertising business, increased user engagement, and growing artificial intelligence (AI) initiatives [3]. - The advertising business is experiencing strong growth across various objectives, channels, verticals, and geographies, with solid growth expected from mid-market and SMB customers [4]. AI and Automation Investments - The company is heavily investing in automation and AI to enhance ad performance and user experience, including features like the AI-powered Reddit Answers tool [5]. - Improvements in Reddit's Ads Manager and the use of Machine Learning (ML) optimization are expected to enhance the overall ad experience [5][6]. International Revenue Growth - International ad revenue rose 77% year-over-year in Q4 2024, with continued strong growth expected from the U.K. and EMEA regions [7]. Stock Performance and Valuation - RDDT shares have declined 25.7% year-to-date, underperforming the Zacks Computer & Technology sector and the Zacks Internet - Software industry [10]. - The stock is trading at a premium with a forward 12-month Price/Sales ratio of 11.26X compared to the industry average of 4.84X [8]. Competitive Landscape - Reddit's expanding partnerships, including collaborations with Alphabet (GOOGL) and Intercontinental Exchange (ICE), enhance its competitive position [14][15]. - However, the company faces intense competition from Snap (SNAP), which has been expanding its advertising capabilities [13][17]. Cost and Regulatory Challenges - Reddit anticipates slightly higher stock-based compensation costs in Q1 2025 due to increased employer taxes related to stock price volatility [18]. - Evolving European Union privacy regulations may also impact Reddit's advertising business internationally [19].

Core Viewpoint - Reddit (RDDT) shares have declined 26.5% year-to-date, underperforming the broader Zacks Computer & Technology sector's decline of 11% and the Zacks Internet - Software industry's rise of 5.8% [1] Group 1: Performance and Market Conditions - The underperformance of RDDT is attributed to a worsening macroeconomic environment following U.S. tariffs on trading partners, including China and Mexico, and intense competition from other social media platforms affecting user engagement and market share in advertising [2] - Reddit experienced volatility due to a periodic algorithm change by Google Search in Q4 2024, which affected traffic primarily for logged-out users [3] Group 2: Revenue and Growth Drivers - RDDT is benefiting from strong user growth, improved advertising performance across multiple channels, and significant investments in AI-driven tools and machine translation, with advertising accounting for 91.2% of Reddit's 2024 revenues totaling $1.3 billion [7] - The company's focus on diversifying its advertising solutions and enhancing ad efficiency has emerged as a critical growth driver [8] Group 3: Product Development and User Engagement - Reddit's expanding advertising product portfolio includes AI-powered tools like the Headline Generator and Reddit Pro Trends, which help businesses gain real-time insights and grow organically on the platform [9] - In March 2025, Reddit introduced tools to enhance user engagement, including a post-check to prevent rule violations and a post-recovery feature for retrieving removed content [10] Group 4: Partnerships and New Initiatives - Reddit's partnership with Alphabet (GOOGL) enhances content discovery and community engagement by providing access to Reddit's Data API, benefiting both companies [11] - In December 2024, Reddit announced testing of "Reddit Answers," an AI-powered chatbot that provides curated summaries and community recommendations [12] - In February 2025, Reddit partnered with Intercontinental Exchange to create data and analytics products for the financial industry, leveraging its extensive user-generated content [14] Group 5: Earnings Estimates and Competition - For Q1 2025, RDDT expects revenues between $360 million and $370 million, with a Zacks Consensus Estimate of $327.70 million, indicating year-over-year growth of 53.40% [15] - Despite RDDT's expanding advertising business, it faces stiff competition from Snap (SNAP), which is enhancing its advertising offerings with new formats like Sponsored AI Lenses and tools like Snap Pixel [16][17]

Core Viewpoint - Reddit has experienced significant growth since its IPO, but recent stock price volatility raises questions about its valuation and future potential [1][2][13] Growth Metrics - Reddit's unique platform combines news aggregation, discussion forums, and social media, allowing it to carve out a niche in the market [4] - The company measures growth through daily active unique (DAUq) users, with a notable increase in logged-in users, which enhances monetization opportunities [5][6] - DAUq users grew from 82.7 million in Q1 2024 to 101.7 million in Q4 2024, reflecting a growth rate of 48% to 39% over the quarters [7] - The percentage of logged-in DAUq users increased from 37% in Q1 2024 to 45% in Q4 2024, contributing to average revenue per user (ARPU) growth [8] Revenue and Profitability - Reddit's revenue growth year-over-year accelerated from 48% in Q1 2024 to 71% in Q4 2024, driven by increased user engagement and advertising [8] - The company expects revenue for Q1 2025 to rise by 48% to 52% year-over-year, with a projected full-year revenue of $1.77 billion, reflecting a 36% increase [10] - Reddit turned profitable on a GAAP basis in the second half of 2024, with net income margins improving from -236.7% in Q1 2024 to 16.6% in Q4 2024 [9][10] Valuation and Market Position - Reddit's enterprise value stands at $19.3 billion, trading at 11 times this year's sales and 34 times its adjusted EBITDA, indicating a reasonable valuation relative to its growth potential [11] - The platform's blend of features continues to attract users and generate data for targeted advertising, suggesting further growth opportunities [12] Future Outlook - Analysts expect Reddit to maintain growth momentum, but macroeconomic factors such as tariffs and trade wars could impact advertising spending [12] - Despite recent stock volatility, Reddit is viewed as a potential growth stock for long-term investors [13]

Core Viewpoint - Wall Street is concerned about a potential recession impacting markets in 2025, with the Nasdaq Composite down 16% year-to-date. However, there are growth opportunities in companies like Reddit and Netflix that could yield significant returns in the coming years [1]. Group 1: Reddit - Reddit is positioned for growth in the $700 billion digital advertising market, benefiting from a large user base that includes high-intent shoppers [3]. - Reddit's advertising revenue grew 50% year-over-year in 2024, reaching $1.2 billion, with a notable acceleration of 60% growth in Q4 compared to the previous year [4]. - Approximately 50% of discussions on Reddit are product-related, increasing the platform's value to advertisers. Average revenue per unique user increased by 23% year-over-year in Q4, alongside a 39% growth in daily active unique users [5]. - The stock has decreased by 59% from recent highs, making it more attractive for investment despite potential short-term slowdowns in the digital ad market. Analysts project Reddit's total revenue to reach $3.5 billion by 2028, up from $1.3 billion last year [6]. - Reddit's stock trades at 32 times this year's earnings estimate, presenting a bargain for a company that could potentially double its revenue in a few years [7]. Group 2: Netflix - Netflix has shown strong performance since the market sell-off in 2022, with shares trading around $1,000 and continued momentum in new member sign-ups and margin expansion [8]. - The company reported a 12% year-over-year revenue increase, surpassing 300 million paid memberships, and earnings per share grew by 25% year-over-year [9]. - With over 5 billion people having internet access globally and 1.6 billion with broadband in 2024, Netflix is well-positioned to capture a significant share of this market due to its extensive content library and global presence [10]. - Netflix has invested billions in content production, resulting in a diverse catalog that appeals to various audiences, while also delivering growth in both revenue and earnings [11]. - Analysts expect Netflix's earnings to reach $37 by 2027, representing a 75% increase from trailing-12-month earnings, suggesting potential for similar returns on investment if the stock maintains its valuation [11][12].

Core Viewpoint - Reddit's stock has seen a significant rebound, primarily driven by broader market recovery and positive sentiment from Alphabet's earnings report, despite no specific news from the company [1][5]. Group 1: Stock Performance - Reddit shares increased by 26% for the week, reflecting a recovery from previous declines due to economic weakness [2]. - The stock jumped 20% over a three-day period from Tuesday to Thursday, followed by an additional 5.3% increase on Friday after Alphabet's strong earnings report [5]. Group 2: Economic Sensitivity - Reddit is considered economically sensitive, with most of its revenue generated from advertising, which tends to decline during economic downturns [4]. - The company is also focusing on artificial intelligence as part of its long-term strategy for monetizing content [4]. Group 3: Future Outlook - Reddit is set to report earnings next week, with analysts projecting a 52% revenue increase to $370 million and an expected per-share profit of $0.02 [6]. - The potential for stock growth exists if Reddit can maintain steady growth despite economic challenges [6].

Reddit could eclipse the AI server-maker's valuation by 2027.Super Micro Computer (SMCI 8.85%), more commonly known as Supermicro, lost more than two-thirds of its market value over the past 12 months. The server company's booming artificial intelligence (AI) business once made it a red-hot growth stock, but the bulls retreated as it struggled with accounting issues, a delayed 10-K filing, delisting threats, and regulatory subpoenas.Yet Supermicro dodged a delisting by turning in its long-overdue 10-K filin ...