Reddit (NYSE:RDDT) Issues Earnings Results

Posted by on Oct 31st, 2026

Reddit (NYSE:RDDT – Get Free Report) announced its quarterly earnings results on Thursday. The company reported $1.40 EPS for the quarter, topping analysts’ consensus estimates of $1.33 by $0.07, FiscalAI reports. The firm had revenue of $894.96 million during the quarter, compared to analysts’ expectations of $874.91 million. Reddit had a net margin of 32.10% and a return on equity of 31.67%. The company’s revenue for the quarter was up 53.0% compared to the same quarter last year. During the same quarter last year, the company earned $0.80 earnings per share.

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

  • Strong Q3 financial performance: Revenue rose 53% year over year to $895 million, while free cash flow nearly doubled to $363 million and adjusted EBITDA margin reached 45%. Reddit also surpassed $3 billion in trailing 12-month revenue.
  • Advertising momentum remained broad-based: Advertising revenue increased 54% to $847 million, supported by more than 50% growth in clicks, more than tripling conversion volume, strong international and mid-market growth, and rising adoption of Reddit Max campaigns.
  • Search referral traffic is declining sharply: Management said Google-related referral declines accelerated in Q3 and continued into Q4, with October referrals down by more than 1 million per week on average. If the trend persists, total daily active users could fall by a low-double-digit percentage in Q4 from the current 130 million base.
  • Reddit plans to test a logged-in-only experience: Tests will begin in select markets outside the U.S. in Q4, aiming to improve personalization, engagement, ad targeting, regulatory flexibility, and protection of Reddit’s data corpus, though management acknowledges the change may trade reach for higher-value engagement.
  • Q4 outlook remains strong: Management expects revenue of $1.0 billion to $1.03 billion, representing 38% to 42% year-over-year growth, and adjusted EBITDA of $480 million to $510 million, with an approximately 49% margin at the midpoint.

Reddit Stock Down 29.2%

RDDT stock traded down $37.86 during midday trading on Friday, reaching $91.74. 33,306,846 shares of the company’s stock traded hands, compared to its average volume of 4,937,290. The company has a 50-day simple moving average of $150.37 and a two-hundred day simple moving average of $160.26. Reddit has a 1-year low of $89.28 and a 1-year high of $263.50. The company has a market cap of $17.65 billion, a price-to-earnings ratio of 18.72, a PEG ratio of 0.60 and a beta of 2.05.

Insiders Place Their Bets

In other news, CEO Steve Huffman sold 18,000 shares of the stock in a transaction on Friday, August 14th. The stock was sold at an average price of $178.16, for a total transaction of $3,206,880.00. Following the sale, the chief executive officer owned 373,814 shares in the company, valued at approximately $66,598,702.24. This represents a 4.59% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Robert Sauerberg sold 5,128 shares of the stock in a transaction on Tuesday, August 25th. The stock was sold at an average price of $159.92, for a total value of $820,069.76. Following the sale, the director owned 27,087 shares in the company, valued at $4,331,753.04. The trade was a 15.92% decrease in their position. The disclosure for this sale is available in the SEC filing. Over the last quarter, insiders have sold 306,052 shares of company stock valued at $49,754,523. 28.48% of the stock is currently owned by corporate insiders.

Wall Street Analyst Weigh In

RDDT has been the subject of a number of recent research reports. Truist Financial dropped their target price on Reddit from $275.00 to $210.00 and set a “buy” rating for the company in a report on Friday. Citizens Jmp lowered Reddit from a “market outperform” rating to a “market perform” rating in a research note on Friday. Raymond James Financial reiterated a “strong-buy” rating and issued a $205.00 price target on shares of Reddit in a research report on Monday, August 17th. Needham & Company LLC lowered their price target on Reddit from $300.00 to $150.00 and set a “buy” rating on the stock in a research report on Friday. Finally, Sanford C. Bernstein reiterated a “market perform” rating and set a $120.00 price objective on shares of Reddit in a research note on Friday. Two investment analysts have rated the stock with a Strong Buy rating, fifteen have assigned a Buy rating and twelve have assigned a Hold rating to the stock. According to MarketBeat, the stock currently has a consensus rating of “Moderate Buy” and an average target price of $197.61.

View Our Latest Analysis on Reddit

Reddit News Summary

Here are the key news stories impacting Reddit this week:

  • Positive Sentiment: Reddit reported third-quarter revenue of approximately $895 million, up 53% year over year, and earnings of $1.40 per share, exceeding analyst expectations. Advertising revenue increased 54%, while improved monetization and first-week app retention—up more than 50% year over year—provided evidence of continued platform engagement. Reddit Q3 Earnings Beat on Ad Growth and Strong Monetization
  • Positive Sentiment: Several analysts retained constructive views despite reducing their targets. Citigroup, Truist Financial, B. Riley and Wedbush still rated RDDT Buy or Outperform, with targets above the current trading level, suggesting potential long-term recovery if user engagement and monetization improve. Reddit Analysts Slash Their Forecasts Following Q3 Earnings
  • Neutral Sentiment: Reddit plans to test a primarily logged-in experience in international markets to reduce data scraping, strengthen data protection and limit its reliance on search referrals. Management is also responding to the growing impact of Google AI search features on website traffic. Reddit Search Traffic Declines and Visitor Sign-In Plans
  • Negative Sentiment: Management’s outlook was the main catalyst for the selloff. Search traffic was described as meaningfully lower, and daily active unique visitors could decline by a low double-digit percentage in the fourth quarter if Google referrals continue weakening. The logged-in-only strategy could further reduce casual and logged-out users before improving engagement or monetization.
  • Negative Sentiment: Analysts broadly cut price targets, including Wells Fargo to $110, Cantor Fitzgerald to $120 and Bernstein to $120; Oppenheimer and Citizens JMP downgraded the stock to market perform. Investors are concerned that international user growth is less valuable than U.S. growth, while Meta and Google remain powerful advertising competitors.
  • Negative Sentiment: Levi & Korsinsky and Block & Leviton announced investigations into whether Reddit adequately disclosed the risks associated with its logged-in-only transition and search-traffic exposure, adding legal and reputational uncertainty. Reddit Investigation Notice

About Reddit

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Reddit, Inc operates a global online platform where users participate in communities organized around shared interests, topics and activities. Members can submit text posts, links, images and videos, as well as comment on and vote on content. The platform includes thousands of communities, commonly known as subreddits, covering subjects such as news, entertainment, technology, sports, finance and lifestyle.

Reddit generates revenue primarily through digital advertising, offering advertisers access to audiences based on community interests and user engagement.

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Earnings History for Reddit (NYSE:RDDT)

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