Reddit CEO Steve Huffman hugs mascot Snoo as Reddit begins trading on the New York Stock Exchange (NYSE) in New York on March 21, 2024.

Timothy A. Clary | AFP | Getty Images

Reddit shares rose 14% in extended trading on Tuesday after the company posted quarterly results for the first time since its March IPO.

Here’s how the company fared:

  • Share loss: $8.19 loss per share. That may not compare to the $8.71 loss expected by LSEG
  • Income: 243 million dollars vs. $212.8 million expected by LSEG

Revenue climbed 48% from $163.7 million a year earlier. The company reported $222.7 million in ad revenue for the period, up 39% year over year, a faster growth rate than its top competitors.

Digital advertising companies have started to grow again with steady growth after brands cut their spending to cope with inflation in 2022. MetaAd revenue jumped 27% in the first quarter, followed by a 24% increase. Amazon and 13% growth at Google parent alphabet.

Reddit reported a net loss of $575.1 million. Stock-based compensation expense and related taxes totaled $595.5 million, primarily due to IPO charges.

For the second quarter, Reddit expects revenue of $240 million to $255 million, beating analysts’ expectations of $224 million, according to LSEG. The midpoint of the guidance range suggests growth of about 32% for the second quarter, up from $183 million a year earlier.

Reddit, which hosts millions of online forums on its platform, was founded in 2005 by Alexis Ohanian and Steve Huffman, the company’s CEO.

“We see this as the beginning of a new chapter as we work to build the next generation of Reddit,” Huffman said in a statement Tuesday.

Reddit began trading under the symbol “RDDT” on The New York Stock Exchange in March. The company priced its IPO at $34 per share, valuing the company at around $6.5 billion. When tech valuations were hot in 2021, Reddit’s private market valuation hit $10 billion.

Shares climbed above $58 in after-hours trading on Tuesday before pulling back a bit. If the stock closes above $57.75 on Wednesday, it will be the highest since March 26, the fourth day of trading. The stock closed the day at $65.11, its highest price ever.

The company reported 82.7 million daily active users in its first quarter, compared to 76.6 million expected by StreetAccount. Global average revenue per user rose 8% to $2.94 from $2.72 a year ago.

Reddit will hold its first quarterly call with investors at 5:00 PM ET.

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