Reddit's stock price surged 13.02% in post-market trading on Thursday, following the release of the company's first-quarter financial results.
The social media platform reported a significant earnings beat, with adjusted earnings per share of $1.01, far exceeding the analyst consensus estimate of approximately $0.58. Revenue for the quarter climbed 69% year-over-year to $663 million, also beating expectations. The company's net income saw a dramatic 680% increase to $204 million, while daily active unique users grew 17% to 126.8 million.
Investor sentiment was further bolstered by Reddit's strong second-quarter outlook. The company forecast revenue between $715 million and $725 million, above analyst estimates. Management highlighted that its AI-powered advertising tools are fueling significant growth in its advertiser base, with ad revenue soaring 74% in the quarter, demonstrating effective competition for digital ad dollars in a crowded market.