Core Insights - Reddit (RDDT) and Alphabet (GOOGL) are significant players in the digital advertising sector, with Reddit emerging as a community-driven platform and GOOGL maintaining its dominance in global search and digital ads [1][2] Digital Advertising Market Overview - The global digital advertising market was valued at $488.4 million in 2024 and is projected to reach $1,164.25 million by 2030, with a CAGR of 15.4% from 2025 to 2030, benefiting both Reddit and GOOGL [2] Reddit's Performance - Reddit's advertising revenue surged 84% year over year to $465 million in Q2 2025, driven by increased investments from existing advertisers and a 50% rise in active advertisers [4][10] - The platform's focus on automation and usability, including tools like Smartly, enhances advertisers' ability to launch and optimize campaigns [5] - Reddit Answers saw significant growth, with weekly users increasing from 1 million to 6 million, contributing to improved ad revenues [6] Alphabet's Performance - Alphabet's advertising revenues increased 10.4% year over year to $71.34 billion in Q2 2025, with search and other revenues rising 11.7% to $54.19 billion and YouTube ad revenues improving 13.1% to $9.77 billion [9][10] - The introduction of AI-powered tools like Asset Studio reflects Alphabet's commitment to enhancing advertiser capabilities [9] Stock Performance and Valuation - Year-to-date, Reddit's stock has risen 42%, while Alphabet's has increased by 22.7%, attributed to strong ad revenue growth and engagement [10][12] - Both stocks are currently considered overvalued, with RDDT trading at a forward Price/Sales ratio of 17.35X compared to GOOGL's 7.76X [14] Earnings Estimates - The Zacks Consensus Estimate for RDDT's 2025 earnings is $1.81 per share, indicating a 154.35% year-over-year increase, while GOOGL's estimate is $10 per share, reflecting a 24.38% increase [16] Conclusion - Reddit is viewed as having greater upside potential due to its rapid revenue growth, expanding advertiser base, and enhanced engagement tools compared to Alphabet [19]