Want to see RDDT full AI Analyst Report?
Top Page
Reddit Inc Class A
(NYSE:RDDT)
Select Model
Select Model
Rating:79Outperform
Price Target:
$185.00
▲(9.64% Upside)
Action:Reiterated
Date:08/08/26
RDDT scores well on fundamentals, led by strong profitability, exceptional free cash flow generation, and minimal leverage, reinforced by an upbeat earnings call with strong revenue/EBITDA guidance and active repurchases. The main offsets are weaker near-term technical momentum and a premium P/E that increases sensitivity to any slowdown, especially given guidance implies moderation and management cited volatile search/referral traffic.
Positive Factors
Cash Generation
Sustained billion-dollar operating and free cash flow provides durable internal funding for product R&D, ML infrastructure, buybacks, and opportunistic M&A. High cash conversion reduces financing risk, supports capital returns and gives flexibility through cycles if growth normalizes.
Negative Factors
Search/Referral Traffic Volatility
Volatility in referral/search traffic threatens predictable user acquisition and ad inventory supply. If referrals remain inconsistent, Reddit may need sustained higher paid acquisition or product fixes to preserve reach, increasing costs and making revenue more sensitive to external traffic channels.
Read all positive and negative factors
Positive Factors
Negative Factors
Cash Generation
Sustained billion-dollar operating and free cash flow provides durable internal funding for product R&D, ML infrastructure, buybacks, and opportunistic M&A. High cash conversion reduces financing risk, supports capital returns and gives flexibility through cycles if growth normalizes.
Read all positive factors
Reddit Inc Class A Key Performance Indicators (KPIs)
Any
Revenue by Geography
Shows how much revenue comes from each country or region, revealing where Reddit monetizes best, which markets drive growth, and where exposure to local ad markets or regulatory change could pose risk.
Shows how much revenue comes from each country or region, revealing where Reddit monetizes best, which markets drive growth, and where exposure to local ad markets or regulatory change could pose risk.
Data provided by:
The Fly
The FlyReddit Inc Class A (RDDT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$31.11B
Dividend YieldN/A
Average Volume (3M)4.10M
Price to Earnings (P/E)34.7
Beta (1Y)2.23
Revenue Growth66.59%
EPS Growth285.68%
CountryUS
Employees2,555
SectorCommunication Services
Sector Strength97
IndustryInternet Content & Information
Share Statistics
EPS (TTM)4.57
Shares Outstanding146,103,200
10 Day Avg. Volume4,097,483
30 Day Avg. Volume4,103,189
Financial Highlights & Ratios
PEG Ratio-0.39
Price to Book (P/B)14.63
Price to Sales (P/S)19.45
P/FCF Ratio62.62
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$218.32Price Target Upside29.39% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering23
EPS Forecast (FY)5.28
Revenue Forecast (FY)$3.36B
Reddit Inc Class A Business Overview & Revenue Model
Company Description
Reddit, Inc. oversees an internet-based service dedicated to fostering diverse online communities. This platform categorizes groups by shared passions, enabling its users to participate in dialogues through recounting experiences, sharing external...
How the Company Makes Money
Reddit generates revenue primarily through advertising and, to a lesser extent, user subscriptions and other services.
1) Advertising (primary revenue stream)
- Promoted placements: Reddit sells ad inventory that appears in user feeds and within/...
Reddit Inc Class A Earnings Call Summary
Earnings Call Date:Jul 30, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Positive
The call emphasized strong, broad-based commercial momentum with high revenue growth (61% YoY), robust monetization gains, improved profitability and record cash flow milestones. Product improvements showed early traction (notably in app retention, feed work, Reddit Max adoption, and video formats) supporting the monetization trajectory. Key challenges center on volatile search/referral traffic and the need to further improve user acquisition returns and retention from a relatively small app retention base; management positioned these as controllable via product work while also reducing some user-metric disclosures. On balance, the positive financial and product signals substantially outweigh the risks discussed.Positive Updates
Strong Revenue Growth
Total revenue grew 61% year-over-year to $805 million in Q2 2026, driven by advertising revenue of $762 million (up 64% YoY) and other revenue of $43 million (up 24% YoY).
Negative Updates
Search Referral Volatility and DAU Headwinds
Search referrals were "choppy" and traffic became more volatile late in the quarter, contributing to an offset in DAU growth despite product-driven gains; visibility into referral traffic remains low.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Revenue Growth
Total revenue grew 61% year-over-year to $805 million in Q2 2026, driven by advertising revenue of $762 million (up 64% YoY) and other revenue of $43 million (up 24% YoY).
Read all positive updates
Company Guidance
Reddit guided Q3 revenue of $860M–$870M (up 47%–49% YoY, ~48% midpoint) and adjusted EBITDA of $385M–$395M (up 63%–67% YoY) implying ~45% adjusted EBITDA margin at the midpoint; they expect Q3 stock‑based compensation and related taxes of $140M–$155M and lowered full‑year SBC guidance from the high‑teens % of revenue to the low‑to‑mid‑teens (SBC YTD <13% of revenue, >1,000 bps lower vs H1 last year); full‑year dilution is expected at the low end of the 1%–3% target range (before buybacks), Q2 repurchases were ~$235M (~1.5M shares at ~$157) with ~$760M remaining authorization, and the company noted strong cash metrics (LTM operating cash flow crossed $1B; cash, cash equivalents & marketable securities $2.8B, up >$700M YoY) while continuing to report total US and international DAUs/WAUs (but ending logged‑in/logged‑out disclosures after Q2).Reddit Inc Class A Financial Statement Overview
Summary
Income Statement
84
Very Positive
Balance Sheet
90
Very Positive
Cash Flow
92
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.78B | 2.20B | 1.30B | 804.03M | 666.70M | 484.92M |
| Gross Profit | 2.54B | 2.01B | 1.18B | 693.02M | 561.90M | 412.35M |
| EBITDA | 894.48M | 544.64M | -469.56M | -73.32M | -149.93M | -124.74M |
| Net Income | 871.10M | 529.72M | -484.28M | -90.82M | -158.55M | -127.90M |
Balance Sheet | ||||||
| Total Assets | 3.64B | 3.24B | 2.34B | 1.60B | 1.60B | 1.65B |
| Cash, Cash Equivalents and Short-Term Investments | 2.79B | 2.48B | 1.84B | 1.21B | 1.27B | 1.41B |
| Total Debt | 20.87M | 23.21M | 26.70M | 25.75M | 19.49M | 13.46M |
| Total Liabilities | 350.90M | 310.13M | 205.85M | 2.01B | 125.28M | 77.63M |
| Stockholders Equity | 3.29B | 2.93B | 2.13B | -412.92M | 1.47B | 1.57B |
Cash Flow | ||||||
| Free Cash Flow | 1.02B | 684.17M | 215.82M | -84.84M | -100.25M | -132.49M |
| Operating Cash Flow | 1.03B | 690.88M | 222.07M | -75.11M | -94.02M | -130.19M |
| Investing Cash Flow | 30.23M | -218.89M | -440.69M | 41.29M | -804.18M | 170.68M |
| Financing Cash Flow | -303.54M | -80.56M | 379.54M | -811.00K | -3.78M | 1.18B |
Reddit Inc Class A Technical Analysis
Negative
168.73
Price Trends
175.96
Negative
162.98
Negative
178.79
Negative
Market Momentum
-6.60
Positive
43.83
Neutral
43.16
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RDDT, the sentiment is Negative. The current price of 168.73 is below the 20-day moving average (MA) of 171.94, below the 50-day MA of 175.96, and below the 200-day MA of 178.79, indicating a bearish trend. The MACD of -6.60 indicates Positive momentum. The RSI at 43.83 is Neutral, neither overbought nor oversold. The STOCH value of 43.16 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RDDT.
Reddit Inc Class A Risk Analysis
Reddit Inc Class A disclosed 49 risk factors in its most recent earnings report. Reddit Inc Class A reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Reddit Inc Class A Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $31.11B | 34.73 | 29.02% | ― | 66.59% | 285.68% | |
76 Outperform | $1.41B | 11.64 | 18.61% | ― | 1.50% | -6.82% | |
70 Outperform | $8.55B | 12.33 | -303.57% | 2.06% | 1.70% | 40.52% | |
69 Neutral | $13.43B | 69.63 | 6.50% | ― | 16.64% | -87.65% | |
66 Neutral | $986.54M | -34.10 | -7.27% | ― | 9.79% | 53.33% | |
61 Neutral | $9.01B | -28.93 | -14.61% | ― | 12.65% | 42.94% | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% |
* Communication Services Sector Average
RDDT
Reddit Inc Class A
158.72
-65.30
-29.15%
YELP
Yelp
24.55
-6.51
-20.96%
SNAP
Snap
5.35
-1.92
-26.41%
PINS
Pinterest
24.37
-10.44
-29.99%
MTCH
Match Group
36.73
1.14
3.19%
NXDR
Nextdoor Holdings
2.68
0.84
45.65%
Reddit Inc Class A Corporate Events
Executive/Board ChangesShareholder Meetings
Reddit Shareholders Back Board, Auditor and Executive Pay
Positive
Jun 10, 2026
On June 8, 2026, Reddit, Inc. held its 2026 annual meeting of stockholders, where investors voted on director elections, auditor ratification, and executive compensation. Stockholders elected all eight director nominees, including CEO Steven Huffm...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.