Reddit Stock Surges on Strong Quarterly Revenue Growth

Reddit shares jumped nearly 11% in after-hours trading following a second-quarter earnings report that exceeded analyst expectations. The social media platform posted $500 million in revenue, marking a 78% year-over-year increase—its fastest growth rate in three years. Wall Street had anticipated $425 million.

Adjusted earnings per share reached $0.92, outperforming the $0.72 consensus estimate. Daily active users grew to 110.4 million globally, narrowly surpassing projections, while U.S. user figures slightly missed at 50.3 million.

The company highlighted traction in its AI-powered Reddit Answers feature, which grew from 1 million to 6 million weekly active users since launch. "Reddit is one of the few platforms positioned to become a true search destination," CEO Steve Huffman noted in an investor letter.

Previous quarters saw share declines despite beating estimates, attributed to volatility from Google Search algorithm changes. This quarter's results suggest improved market confidence in Reddit's growth trajectory.