Reddit (NYSE:RDDT) Posts Earnings Results, Beats Expectations By $0.39 EPS

01 May 2026, 18:26 by Amy Steele · The Cerbat Gem

Reddit (NYSE:RDDT – Get Free Report) posted its quarterly earnings results on Thursday. The company reported $1.01 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.62 by $0.39, FiscalAI reports. The business had revenue of $663.41 million during the quarter, compared to analyst estimates of $607.74 million. Reddit had a net margin of 24.05% and a return on equity of 20.89%. The firm’s revenue was up 69.1% compared to the same quarter last year. During the same period in the prior year, the firm earned $0.13 earnings per share.

Here are the key takeaways from Reddit’s conference call:

Q1 revenue reached $663 million (+69% YoY) with ad revenue of $625 million (+74% YoY); the company reported >90% gross margins, a 40% adjusted EBITDA margin, record cash flow >$300M and GAAP EPS of $1.01—its seventh consecutive quarter of >60% revenue growth.
Reddit says it has nearly 500 million weekly users (200M in the U.S.) and is targeting 100 million daily U.S. users, while investing heavily in feed, ML, onboarding and performance to lift frequency and retention, but acknowledges engagement still needs improvement.
Commercial momentum includes strong early adoption of Reddit Max (beta) with reported ~17% lower CPA and 25% more conversions, active advertisers up >75% YoY, and commerce products (DPAs, Shopify integration) delivering materially higher ROAS for advertisers.
Reddit framed its two-decades of community conversation as a strategic asset for AI (partnerships with Google/OpenAI), but provided limited detail on current AI licensing economics or exclusivity, leaving the magnitude of near-term AI monetization unclear.

Reddit Price Performance

RDDT traded up $19.30 during midday trading on Friday, hitting $166.53. 14,154,487 shares of the company’s stock traded hands, compared to its average volume of 5,296,608. The company has a market cap of $31.81 billion, a PE ratio of 63.56, a price-to-earnings-growth ratio of 1.07 and a beta of 2.40. The stock’s fifty day simple moving average is $144.12 and its 200-day simple moving average is $184.31. Reddit has a one year low of $94.89 and a one year high of $282.95.

Reddit News Summary

Here are the key news stories impacting Reddit this week:

Positive Sentiment: Q1 earnings and revenue beat — Reddit reported EPS of $1.01 (vs. ~$0.62 est.) and revenue of about $663M, a ~69% year‑over‑year jump; ad revenue rose sharply, underscoring improving monetization. Zacks: Reddit Q1 Earnings Beat
Positive Sentiment: Upbeat near-term guidance — management gave Q2 revenue guidance (~$715M–$725M) above Street expectations, signaling continued ad demand momentum. Reuters: Reddit expects revenue above estimates
Positive Sentiment: AI-driven ad products & search improvements gaining traction — exec commentary and coverage point to rising advertiser adoption of lower‑funnel, AI-enhanced ad tools and a ~30% YoY increase in weekly search usage, both supporting higher yield per user. Reuters: AI-driven ad growth fuels outlook TechCrunch: People are finally using Reddit’s search
Positive Sentiment: Analyst support — several firms reaffirmed or raised targets (e.g., Piper Sandler raised its PT to $215; Needham reaffirmed buy with $300 PT; DA Davidson reaffirmed buy at $200), adding buy‑side validation. TickerReport / coverage on Piper Sandler
Neutral Sentiment: Unusual options activity — traders purchased ~80,316 call options (about +88% vs. typical daily call volume), indicating speculative bullish positioning but not guaranteeing directional follow‑through.
Neutral Sentiment: Cantor Fitzgerald raised its price target (to $180) but left a neutral rating — a mixed signal: higher target but not a bullish rating change. Benzinga: Cantor Fitzgerald update
Negative Sentiment: Some analyst conflict and target trimming — Citizens Jmp reduced its target from $250 to $240 (still bullish stance), reflecting differing views on longer‑term upside and leaving room for skepticism about sustainability. Benzinga: Citizens Jmp update

Insider Activity

In other news, CEO Steve Ladd Huffman sold 18,000 shares of Reddit stock in a transaction that occurred on Friday, February 27th. The shares were sold at an average price of $145.12, for a total value of $2,612,160.00. Following the transaction, the chief executive officer owned 411,195 shares of the company’s stock, valued at $59,672,618.40. This trade represents a 4.19% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, Director Sarah E. Farrell purchased 43,800 shares of the company’s stock in a transaction dated Tuesday, February 10th. The stock was purchased at an average cost of $149.52 per share, for a total transaction of $6,548,976.00. Following the transaction, the director owned 43,800 shares of the company’s stock, valued at approximately $6,548,976. This trade represents a ∞ increase in their ownership of the stock. The disclosure for this purchase is available in the SEC filing. In the last ninety days, insiders purchased 61,000 shares of company stock worth $8,870,815 and sold 280,441 shares worth $40,873,759. 34.25% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On Reddit

A number of institutional investors have recently modified their holdings of RDDT. Bamco Inc. NY acquired a new stake in shares of Reddit in the fourth quarter worth $182,000. DV Equities LLC acquired a new stake in shares of Reddit in the fourth quarter worth $92,000. Transamerica Financial Advisors LLC grew its stake in shares of Reddit by 91.8% in the fourth quarter. Transamerica Financial Advisors LLC now owns 652 shares of the company’s stock worth $150,000 after acquiring an additional 312 shares during the last quarter. Silicon Valley Capital Partners acquired a new stake in shares of Reddit in the fourth quarter worth $115,000. Finally, IFC & Insurance Marketing Inc. acquired a new stake in shares of Reddit in the fourth quarter worth $86,000.

Wall Street Analyst Weigh In

A number of research firms have recently issued reports on RDDT. UBS Group set a $265.00 price target on shares of Reddit in a research report on Tuesday, January 13th. Robert W. Baird set a $200.00 price target on shares of Reddit in a research report on Friday, February 6th. The Goldman Sachs Group reissued a “neutral” rating and issued a $200.00 price target on shares of Reddit in a research report on Friday. Guggenheim raised their price objective on shares of Reddit from $245.00 to $255.00 and gave the company a “buy” rating in a research report on Friday, February 6th. Finally, Truist Financial set a $265.00 price objective on shares of Reddit in a research report on Friday. One research analyst has rated the stock with a Strong Buy rating, eighteen have given a Buy rating and eleven have issued a Hold rating to the company’s stock. According to data from MarketBeat.com, the company presently has an average rating of “Moderate Buy” and a consensus target price of $228.61.

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About Reddit

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Reddit is an online social news aggregation, discussion and content-sharing platform organized around user-created communities called “subreddits,” each focused on a particular topic or interest. Registered users submit links, text posts, images and video, and community members vote and comment to surface popular content. The site is accessed via its web platform and mobile apps for iOS and Android, and it supports live events such as Ask Me Anything (AMA) sessions and community-driven discussions.

Founded in 2005 by Steve Huffman and Alexis Ohanian, Reddit is headquartered in San Francisco and serves a global audience with particularly large user bases in the United States and other English-speaking markets.