Core Insights - Reddit reported Q1 earnings of 13 cents per share, exceeding analyst expectations of 2 cents, with revenue of $392.36 million surpassing the consensus of $370.01 million, marking a year-over-year increase of $242.96 million [1] - Analysts are optimistic about Reddit's revenue growth and profitability, with projections for FY25 revenue raised from $1.722 billion to $1.795 billion [2] - Advertising performance improved significantly, with pricing growth for the first time since the IPO, driven by mid- and lower-funnel ad strategies, which now represent 60% of ad revenue [5] Analyst Perspectives - Needham highlighted strong revenue and margin growth, better ad performance, rising daily active users, and promising new features that enhance engagement [1] - JP Morgan anticipates continued strong revenue growth and a target of 40% long-term adjusted EBITDA margin [2] - Citizens noted that Reddit is insulated from tariff-related risks and that sector-specific macro headwinds are unlikely to disrupt the company significantly [4] Financial Projections - Projected average growth rates for 2025 and 2026 are 12% for revenue, 33% for adjusted EBITDA, and 34% for free cash flow, justifying Reddit's premium valuation [3] - Analysts have adjusted their price targets, with Needham raising it from $135 to $145, JP Morgan from $110 to $145, Citizens from $155 to $180, and Guggenheim from $170 to $165 [6]