NEW YORK (AP) — Reddit has reported a profit for the first time in its nearly two-decade existence. For the quarter ending in September, the platform shared earnings of $29.9 million, equating to 16 cents per share, accompanied by revenue of $348.4 million. This figure exceeded analysts’ expectations, which had anticipated sales of $312.8 million. Additionally, Reddit experienced significant user growth, boasting 97.2 million daily users, marking a remarkable 47% increase from last year, as noted in a company statement.
Reddit CEO Steve Huffman, in a letter to shareholders, highlighted the role of the site’s new AI translation feature, which allows users to translate posts between several languages including English, French, Spanish, Portuguese, Italian, and German. This innovation has notably boosted international engagement in countries such as France, India, and the Philippines. Huffman indicated that Reddit aims to expand this feature to over 30 additional countries by 2025.
In 2024, “Reddit” became the sixth most searched term on Google in the U.S., emphasizing the platform’s role as a go-to resource for answers, advice, and community interaction, Huffman noted. He cited an example during recent hurricanes when the White House utilized Reddit to disseminate crucial information, successfully reaching individuals in the affected regions with timely updates.
While advertising remains the cornerstone of Reddit’s revenue, their financial report indicates that new data licensing agreements are starting to yield benefits. Notably, companies like Google and OpenAI have formed partnerships with Reddit to utilize its content for training their AI models.
Reddit, with investments from OpenAI CEO Sam Altman, entered the public market in March at $34 per share. Since then, the stock has more than tripled, soaring 34% to reach $110.20 during morning trading on Wednesday, reflecting strong investor confidence in the platform’s growth and profitability.
