Reddit surges on strong revenue forecast

Reddit

01/05/2026 09:21

** Reddit Inc's RDDT.N shares surge 13.3% to $166.85 in pre-market trading after the social media company forecast second-quarter revenue above estimates on Thursday, betting on its AI-powered tools to boost ad growth

** The company sees second-quarter revenue of $715 million-$725 million, above estimates of $711.6 million, per LSEG, after first-quarter revenue beat expectations, rising 69% to $663 million

** Reddit's daily active unique visitors grew 17% to 126.8 million in Q1, while its active advertiser base rose 75% y/y as its ad platform uses AI to improve campaign creation

** " RDDT is focused on driving incremental Revenue per employee, which we think will help drive fixed cost leverage and maintain incremental margins above 50%," analysts at Jefferies say

** The average rating of 30 analysts covering the stock is "Buy", and their median price target is $240 - data compiled by LSEG

** RDDT shares have sunk about 36% year-to-date, underperforming a 5.3% rise in the S&P 500 .SPX

(Reporting by Rashika Singh in Bengaluru)

((Rashika.Singh@thomsonreuters.com;))