Reddit, the cheeky social media platform that serves as a bridge for thousands of forums, is having a better-than-expected inaugural earnings debut as a public company.
Shares of Reddit spiked by 11% in after hours, trading at $55, after the company crushed first-quarter-earnings expectations. The company’s shares are significantly higher than its March IPO listing of $34 a share.
The company filed a confidential IPO filing in December 2021 and finally made its debut on the New York Stock Exchange just two months ago, making it the first social media platform to go public in years.
Reddit, which was founded in 2005, appears to be wasting little time. It blew past Wall Street’s expectations. For the first quarter, Reddit reported revenue of $243 million, up 48% when compared to the same period a year ago, the company said in its earnings release. Analysts forecasted it would report $214 million.
The company said it lost $575.1 million during the period, in part because of costs related to its IPO.
Those expenses could be paying off. Reddit reported its weekly active users, or those who visit the website once during a 7-day period, were up by 40% to 306.2 million, during the first quarter. Meanwhile, the platform’s daily active users, which represent users who open Reddit’s application at least once during a 24-hour window, ballooned by 37% to 82.7 million.
“It was a strong start to the year and a milestone quarter for Reddit and our communities as we debuted as a public company,” said Steve Huffman, Reddit’s CEO, in a statement. “We see this as the beginning of a new chapter as we work towards building the next generation of Reddit.”
For its second quarter, Reddit expects revenue to be between $240 million to $255 million. It expects adjusted EBITDA to break even or reach up to $15 million.