Key Points Reddit benefits from a growing user base that seeks out the platform for answers on a range of topics. Advertising revenue grew 74% year over year last quarter. Reddit benefits from a strong tailwind in the global advertising market, which is expected to grow faster than consumer spending. 10 stocks we like better than Reddit › Reddit's (NYSE: RDDT) stock has nearly doubled since suffering a severe dip in April, bringing the stock's 12-month gain to 25%. The recovery was driven by the ...

Core Insights - Reddit has shown remarkable performance in 2025, with shares surging and achieving profitability for the first time, posting $163 million in net income in Q3 2025 after a loss of $484 million in 2024 [2][5] - Analysts are optimistic about Reddit's growth, with a consensus price target of $242, indicating a modest 2% upside from current levels around $238, driven by strong revenue growth and user engagement [3][4] Financial Performance - Q3 2025 revenue reached $585 million, reflecting a 68% year-over-year growth, surpassing the consensus estimate of $549 million [3][5] - Earnings per share for Q3 were $0.80, exceeding expectations of $0.52, and advertising revenue increased by 74% year-over-year to $549 million [3][5] - Free cash flow for the last quarter was $183 million, up 158% year-over-year [4][6] Growth Catalysts - Continued earnings beats are expected, with Q4 revenue guidance set between $655 million and $665 million, indicating sustained momentum [6] - Speculation around S&P 500 inclusion could lead to significant passive inflows, enhancing stock demand [6] - Daily active users grew by 19% year-over-year, which is anticipated to drive higher advertising revenue [6] - Reddit's gross margins expanded to 91%, providing room for leveraging platform economics as the company scales [6] Market Context - If the Nasdaq maintains its 2025 performance into 2026, high-growth stocks like Reddit are likely to benefit from a risk-on sentiment in the market [7]

Core Insights - Holding shares of growing companies is an efficient way to build wealth over time, focusing on long-term investments and companies with competitive advantages [1] Group 1: Reddit - Reddit has become one of the top three most visited sites in the U.S., attracting advertisers due to its conversation-driven platform [2] - The platform saw a 19% year-over-year increase in daily active users, reaching 116 million in Q3 [3] - Reddit's revenue increased by 68% year-over-year to $585 million last quarter, driven by higher user engagement and ad spending [5] - The company reported a net profit of $163 million last quarter and generated $509 million in free cash flow, a 387% year-over-year increase [6] - Analysts project free cash flow to grow at a 62% annualized rate, reaching $2.4 billion by 2029, potentially doubling the share price in five years [6] Group 2: MercadoLibre - MercadoLibre is the leading e-commerce company in Latin America, with over 110 million unique buyers and $56 billion in quarterly gross merchandise volume [7] - The company's fintech services significantly contribute to its e-commerce growth, with Mercado Pago accounting for approximately 25% of marketplace transactions [9] - MercadoLibre's credit portfolio grew 83% year-over-year to $11 billion, with 1.3 million new credit cards issued in Brazil last quarter [10] - The company has maintained a 39% year-over-year revenue growth for 30 consecutive quarters, indicating strong business performance [11] - The stock is trading at a price-to-sales (P/S) ratio of 3.8, which is low compared to its historical range, with expected revenue growth of 24% annually through 2029 [12]

Core Insights - Reddit has reported its fifth consecutive profitable quarter since going public, earning $0.80 per share with a revenue of $585 million, reflecting a 68% year-over-year growth [1] - Despite recent gains, Reddit shares are down over 20% from their year-to-date high [2] Financial Performance - Reddit achieved a 74% year-over-year increase in ad revenue and a 41% growth in average revenue per user (ARPU) for Q3 [4] - Daily active users (DAUs) reached 116 million, with international user growth at 31% due to translation capabilities across 30 languages [4] Market Position and Partnerships - Reddit's status as the third most visited website in the U.S. enhances its appeal to advertisers and data licensing partners [3] - Partnerships with Google and OpenAI have improved Reddit's monetization potential and positioned it as a key player in AI model training [3] Stock Performance and Predictions - Options traders are optimistic about Reddit's stock, with predictions of a price increase to approximately $253 by January 16, and an expected move to around $229 by November 14 [5][6] - Reddit shares have historically returned nearly 18% in November and over 16% in December over the past four years [7] Analyst Recommendations - Wall Street analysts recommend holding RDDT stock for the long term, indicating confidence in its future performance [8]

Core Insights - Reddit shares increased by approximately 28% in 2025, with a notable 8% rise on a recent Friday following better-than-expected earnings and a positive outlook [1][6]. Financial Performance - Reddit reported third-quarter earnings per share (EPS) of $0.80, significantly surpassing analyst expectations. Revenue grew by 68% year-over-year, reaching $585 million, also exceeding forecasts [2]. User Growth - Daily active unique users (DAUqs) rose by 19% to 116 million, with international users increasing by 31% to 64.4 million, driven by growth in France, Brazil, and India. U.S. DAUq saw a 7% increase to 51.6 million [3]. Strategic Focus - CEO Steve Huffman highlighted that Reddit is making progress in three key areas: core product, search, and internationalization. He emphasized that search represents a significant opportunity, with over 75 million users utilizing Reddit for internet searches during the period, a number that is on the rise [4].

Group 1 - Reddit's stock experienced a significant increase, closing up more than 7% after reporting strong third-quarter growth metrics [1] - The company's revenue surged by 68% year over year, reaching $585 million, with daily active unique visitors increasing by 19% to 116 million and weekly users rising by 21% to 444 million [3] - Reddit is now the third most-visited website in the U.S., following Google and YouTube [3] Group 2 - Advertising revenue was a major growth driver, with ad sales increasing by 74% to $549 million [4] - The net income of Reddit increased fivefold to $163 million, or $0.80 per share, surpassing Wall Street's earnings per share projections of $0.52 [5] - The company is investing in AI and automation technology to enhance marketing tools for better customer targeting [4]

Core Insights - Reddit's stock increased by over 18% following the announcement of strong third-quarter results and positive advertising growth [1] Financial Performance - Reddit's revenues rose 68% year-over-year to $585 million, exceeding the LSEG estimate of $546 million [2] - Earnings per share reached 80 cents, surpassing the expected 51 cents [2] - The company provided an optimistic sales outlook for Q4, projecting revenues between $655 million and $665 million, above the Wall Street forecast of $638 million [2] Growth Potential - Analyst Brian Nowak from Morgan Stanley noted that the results indicate continued progress in Reddit's advertising and platform initiatives [3] - Active advertisers increased by 75% year-over-year in Q3, suggesting significant growth potential [3] - Nine of Reddit's top 15 advertiser verticals experienced growth of over 50%, highlighting strong demand [3] - Ongoing investments in automation are enhancing return on advertising spending, further supporting growth [3]

Core Insights - Reddit (RDDT.US) shares surged nearly 19%, closing at $230.92, following the release of its third-quarter earnings report which significantly exceeded expectations [1] Financial Performance - Revenue for the third quarter increased by 68% year-over-year, reaching $585 million, while earnings per share (EPS) stood at $0.80, surpassing the target of $0.51 [1] - Net profit amounted to $163 million, up from $133 million in the same period last year, reflecting a 23% increase [1] Future Guidance - The company raised its fourth-quarter performance expectations, forecasting revenue between $655 million and $665 million, well above Wall Street's prior estimate of $638 million [1] - Adjusted earnings expectations for the fourth quarter are set between $275 million and $285 million, exceeding the previous forecast of $259 million [1]

Core Insights - Reddit's stock surged over 13% following the announcement of third quarter revenue that exceeded Wall Street forecasts, with revenue reaching $585 million, a 68% increase year-over-year [1][7] - Daily active users (DAUs) grew 19% to 116 million, surpassing analyst expectations, although this growth rate has been slowing over the past five quarters [2][5] Revenue and Earnings - The reported revenue of $585 million for Q3 was above the expected $549 million, indicating strong performance [1][7] - Earnings per share for the quarter were $0.80, a significant increase from $0.16 in the same period last year [6] User Growth Metrics - DAUs increased to 116 million, exceeding the expected 114 million, but the growth rate has been decelerating, raising concerns among analysts [2][5] - International users contributed positively, with 64.4 million international DAUs reported, above the anticipated 62.2 million, while US users were slightly below expectations at 51.6 million [4] Future Outlook - The company provided an optimistic forecast for Q4, expecting revenue of $660 million, surpassing the Wall Street expectation of $636 million [7] - The forecast for Q4 adjusted EBITDA is $280 million, also ahead of the expected $258 million [8]

Core Viewpoint - Raymond James raised its price target on Reddit (NYSE: RDDT) to $250 from $225 while maintaining a Strong Buy rating, resulting in a more than 6% increase in shares intra-day on Monday [1] Group 1: Revenue and Advertising Metrics - The updated analysis indicates a bull case for U.S. logged-in ARPU approaching $100, driven by higher ad load, stronger CPMs, and on-platform AI search that could increase query volume [1] - Agency checks revealed e-commerce campaigns with targeting clearing above $6 CPM, showing a triple-digit year-over-year increase, consistent with revised internal metrics suggesting about $4 CPM for generic campaigns compared to $2 previously [2] - Raymond James benchmarked Reddit's U.S. revenue per thousand impressions (RPM) at roughly $2 currently, with a bull case near $6, while the peer average is around $5 across platforms like Google, Meta, Pinterest, Snap, and Nextdoor [2] Group 2: Advertising Load and AI Search Potential - The model assumes home-feed ad load will rise from 13% (1-in-8) to 17% (1-in-7), which is still below many peers that could flex to 25%-50% [3] - For AI search, the firm projected queries increasing from 1.5 billion per month to 4 billion, with a 25% ad load, sub-1% click-through rate, and $1 cost-per-click, implying a roughly $350 million incremental revenue opportunity for currently unmonetized formats [3] Group 3: Market Sentiment - Analysts described the tactical setup as neutral into the print but argued that the risk/reward remains attractive at current levels [4]