Reddit is a social media platform made up of thousands of user-driven communities, or ‘subreddits’, where people can discuss a wide range of topics from hobbies and interests to news and entertainment.
It’s unique because users can share and engage in conversations around their passions, ask questions, and discover new insights. Reddit’s value proposition lies in its focus on authentic, user-generated content, and the platform’s trustworthiness, as well as the vast variety of niche communities that cater to different interests.
Reddit’s growth has increased through the enhancement of its user experience through faster navigation, AI-powered tools for safer content moderation, and an improved search experience.
Recent initiatives, like the expansion of international markets and the development of an ad platform, have helped boost both user engagement and revenue.
As close followers of my work will know, I’m obsessed with the stability of a platform’s user base. On this front, Reddit doesn’t disappoint.
As of Q2, Reddit had over 342m active users, with 91m daily active users, seeing over 50pc y/y growth in both users and revenue. International daily active users grew by 44pc, highlighting Reddit’s potential in global markets.
Seeking Alpha, Michael Wiggins de Oliveira, 24 September 2024
Recently floated Reddit is an exciting company.
I’m excited to share that Q3 was a landmark quarter for Reddit. We averaged over 97m daily active uniques, an increase of 47pc from last year, and for the first time, we exceeded 100m a few times during the quarter, which has been a longstanding milestone for us. Our Q3 revenue grew 68pc year-over-year, and I’m proud to announce that we achieved GAAP profitability. Reddit’s influence continues to grow across the broader internet. In 2024 so far, “Reddit” was the sixth most Googled word in the U.S., underscoring that when people are looking for answers, advice, or community, they’re turning to Reddit. We saw this play out in real-time when the White House came to Reddit to share critical information during recent hurricanes, reaching people in the affected areas with timely updates. We remain focused on making Reddit the best place on the internet for conversations and community. Which means—quite simply—we are continuously improving the user experience by making discovery easier, making the platform faster and smarter, enabling seamless contribution, and simplifying moderation.
Redditt Shareholders Letter, Q3 2024, 29 October 2024
The international opportunity looks both huge and largely untapped.
And as for growing beyond the US, our efforts are proving successful. International DAU [daily active users] grew 44pc year-over-year, led by 53pc growth in our focus markets, most notably in France, India, and the Philippines. This year, we started using AI to translate Reddit’s corpus into other languages, making it more accessible for non-English speakers to enjoy in their native languages. After promising results with French in the first half of this year, we expanded our coverage to include Spanish, Portuguese, Italian, and German. This quarter, machine translation drove four times more users than last quarter, and based on the success we’ve seen so far, we plan to expand machine translation to over 30 countries through 2025. As Reddit becomes a truly global platform, we are focused on ensuring everyone, regardless of their language, can participate in and benefit from the communities on Reddit.
Redditt Shareholders Letter, Q3 2024, 29 October 2024
The opportunity looks huge.
We are adding new advertisers. Every quarter, there are thousands of new advertisers onto our platform. Now it’s not at the levels that we think is possible. I think that TAM is really large compared to where we are today. There are many more lines of business and thousands more advertisers that can be on our platform, but we are adding them and acquiring new customers onto the platform. So those are obviously seeds that are planted for the future while we continue to grow our base book of business. So I’d say both were contributors.
Steven Ladd Huffman, co-founder & CEO, Redditt, Q3 2024, 29 October 2024
The company is buzzing with innovation and excitement.
And so then on the search side, look, we’ll be doing a lot of heavy lifting throughout 2025. So high-level road map, modernizing our search products, so kind of bringing it up to table stakes or what are table stakes in this era, so really good auto complete, beautiful results pages. We’ll start working integrating LLMs into making our results more sophisticated, I mean helping users navigate all of the results that come back from Reddit. And there’s a lot of back-end work as well, which is improving our own ability to do retrieval, getting more sophisticated ranking ourselves, and then creating more entry points in the search as well, so not just the search button on Reddit but, for example, users who arrive to Reddit from external search, helping them kind of expand their queries and find more of what they’re looking for. So all of that will be under heavy construction. We do a lot of testing, so you’ll start to see this over the course of the next year. In terms of when we start monetization, we need to have some stability in the product, right? It’s hard to monetize a product when the pixels are moving all over. So that’s the simplest answer. I think most likely is we’ll find some products we like next year. That’s something we’ll begin planning. And so I wouldn’t expect actual dollars to be coming in, in 2025, but hopefully not too far after. So we’ll follow the product. There’s lots of exciting stuff coming. I think the opportunity is really big. And we’re looking forward to getting there. But it is a multistep process. But I think you’ll be able to follow along with us each quarter as we go next year.
Steven Ladd Huffman, co-founder & CEO, Redditt, Q3 2024, 29 October 2024
Share Recommendations (30 December 2024)
Redditt. RDDT