Reddit reported a stronger-than-expected first-quarter revenue and issued more optimistic guidance for the second quarter. The company’s sales rose 61% from last year to $392 million, exceeding Wall Street expectations of $370 million.
CEO Steve Huffman attributed the performance to Reddit’s ability to navigate challenges in the macro environment, saying “Ever-shifting environments create both challenges and opportunities.” The company’s global daily active users (DAU) increased by 31% to 108.1 million, with logged-in DAU rising 23% to 48.7 million.
Reddit’s growth has been driven by its focus on site updates and features aimed at convincing users to log in. However, the company acknowledged that Google search algorithm changes could impact user growth in the near term. Huffman noted that Reddit is adapting to these changes with its own AI-powered services, such as Reddit Answers.
The company’s guidance for the second quarter sets a new high mark of $396 million, beating Wall Street expectations. Despite macroeconomic uncertainty, Reddit remains confident in its ability to meet the growing demand for online connection and information.
In contrast, other tech companies are facing challenges in the current economic environment. Meta’s advertising sales missed estimates due to reduced spending by Asia-based e-commerce exporters, while Snap declined to provide guidance on its earnings report due to macroeconomic uncertainties.
Source: https://www.cnbc.com/2025/05/01/reddit-rddt-q1-2025.html