Factual Summary
Reddit (RDDT) posted Q2 2026 (April–June) revenue of $804.9M (up 61% year-over-year), extending eight consecutive quarters of 60%+ growth, with net income of $252.8M for a 31% net margin (company earnings release, 2026-07-30). On August 13, 2026, S&P Dow Jones Indices announced RDDT's inclusion in the S&P500, and the stock rose +12.63% versus the previous close to close at $178.09 on August 14, 2026 (CNBC, StockStory, 2026-08-13–14). During the same period, Reddit is in negotiations to renew a $60M annual AI data licensing agreement with Google, with final terms not yet finalized as of the as-of date (CNBC, 2026-07-22).
Price-Change Context
The as-of-date closing price of $178.09 reflects a surge driven by index-fund inflows following the August 13, 2026 S&P500 inclusion announcement, and remains -37.1% below the same day's 52-week high of $282.95 (StockStory, 2026-08-14). Q2 earnings released on July 30, 2026 beat consensus on both revenue and EPS, but the stock fell as much as -12.5% in after-hours trading that day amid concerns raised on the earnings call about volatility in Google search referral traffic (Investing.com, 2026-07-30).
Business Overview
Reddit's revenue is composed of two segments — advertising and other revenue (including AI data licensing) — and in Q2 2026, advertising revenue of $762M (YoY +64%) accounted for roughly 95% of total revenue (Motley Fool earnings call transcript, 2026-07-30). For Q3 guidance, the company projected revenue of $860M–$870M and adjusted EBITDA of $385M–$395M (StockStory, 2026-07-30).
5-Year Financial Trend
| Year | Revenue | Operating Margin | Net Margin |
|---|---|---|---|
| 2022 | $666.7M | -25.8% | -23.8% |
| 2023 | $804.0M | -17.4% | -11.3% |
| 2024 | $1,300.2M | -43.1% | -37.2% |
| 2025 | $2,202.5M | +20.1% | +24.0% |
| H1 2026 (cumulative) | $1,468.3M | +28.2% | +31.1% |
The large 2024 operating loss (-$560.6M) was primarily driven by a one-time accounting event: at the time of the March 2024 IPO, the performance conditions of 'double-trigger RSUs' were satisfied all at once, resulting in $534.7M of stock-based compensation expense being recognized (10-K, SEC EDGAR). Following the return to profitability in 2025, the margin-improvement trend has continued through H1 2026.
Peer Comparison
| Company | EV/EBITDA | EV/Revenue | 2026 YTD Stock Return |
|---|---|---|---|
| Reddit(RDDT) | 43.29x | 11.84x | -14% |
| Pinterest(PINS) | 27.58~31.99x | 2.94x | -15% |
| Snap(SNAP) | Negative (loss) | 1.54x | -41% |
| Meta(META) | 14.71x | 7.18x | +9% |
Among peer social media companies, Reddit posted the highest Q2 2026 revenue growth rate (+61%) and trades at the highest multiples on both EV/EBITDA and EV/Revenue (GuruFocus, queried May–July 2026). Because the query dates for each multiple differ by source across May–July 2026, this is not a fully like-for-like, same-date comparison.
Valuation
Based on the 2026-08-14 closing price of $178.09 and 192.40M shares outstanding, TTM PER computes to approximately 39.3x (calculated, A). The 5-year P/E band declined from 82.23x in Q4 2025 to 38.36x in Q2 2026, indicating easing valuation-multiple pressure, though it remains at the top of the peer group compared to Meta's EV/EBITDA of 14.71x (GuruFocus, Simply Wall St, C).
Supply/Demand & Ownership
| Settlement Date | Short Interest | % of Float |
|---|---|---|
| 2026-06-15 | 16,467,051 shares | 12.0% |
| 2026-06-30 | 17,003,132 shares | 12.3% |
| 2026-07-15 | 16,986,699 shares | 12.3% |
| 2026-07-31 | 19,213,705 shares | 14.0% |
From mid-June through the end of July 2026, short interest continued to rise, with the percentage of float increasing from about 9.7% to 14.0% (MarketBeat, based on FINRA data). Over the same period, 13F filings (as of 2026-06-30) showed somewhat more instances of increased institutional holdings than decreased ones, though direction varied across individual institutions (Quiver Quantitative).
Governance & Capital Structure
As of the latest SC 13G/13G-A filings dated 2024-11-14 (ownership percentage by class) — no newer amended filings have been identified since, so the most recent 2025–2026 ownership percentages are unavailable (SEC EDGAR).
| Date | Details |
|---|---|
| 2026-04-20 | Christopher Slowe transitioned from CTO to Senior Technical Fellow (successor CTO not yet identified) |
| 2026-08-12 | CLO Benjamin Lee's departure announced (effective 2026-09-14), Paul Cappuccio named successor (8-K, 0001713445-26-000107) |
Reddit has adopted a dual-class structure with Class A (1 vote/share) and Class B (10 votes/share) stock, and has disclosed itself as a controlled company under NYSE rules, with CEO Huffman holding a majority of total voting power (DEF 14A, 2026-04-23). Under voting agreements with Huffman, effective voting power is further concentrated with Huffman via commitments from Advance Publications and Tencent.
Macro Factors
| Factor | As-of Value | Transmission Channel (Factual Summary) |
|---|---|---|
| U.S. 10-Year Treasury Yield | 4.68~4.70% (2026-08-14) | Acts as a channel for rising discount rates on high-valuation growth stocks (C) |
| Fed Funds Rate | Held at 3.50–3.75% (2026-07-29 FOMC) | A factor restraining further discount-rate increases (C) |
| Dollar Index (DXY) | 99.8~99.9 (2026-08-14) | A mildly favorable factor for translating international ad revenue (about 22% of total, YoY +84%) (C) |
| S&P500 Inclusion | Inclusion effective 2026-08-18 (announced 2026-08-13) | Index-fund inflows were the primary driver of the 8/13–14 price surge (A) |
Risk Factors
- Business-Specific Search-referral traffic volatility — on the Q2 2026 earnings call, management noted that Google search referrals had been 'lumpy' (Company earnings call, 2026-07-30).
- Business-Specific AI data licensing revenue is concentrated in two counterparties, OpenAI and Google, and renewal negotiations for the $60M annual contract with Google are ongoing (CNBC, 2026-07-22).
- Regulatory The UK Information Commissioner's Office (ICO) imposed a fine of approximately £14.47M in February 2026 for inadequate age verification (HL.co.uk).
- Litigation A securities class action related to IPO disclosures (Babbini v. Reddit, filed 2026-03-30) is ongoing, and the outcome is not yet available.
- Governance The dual-class stock structure gives the CEO majority control of total voting power, and the company is designated a controlled company (DEF 14A, 2026-04-23).
- Valuation TTM PER of approximately 39.3x and EV/EBITDA of approximately 43.3x represent relatively elevated valuation multiples compared to peers (calculated, GuruFocus).
Recent News Timeline
| Date | Details |
|---|---|
| 2026-07-22 | Report on Google AI licensing contract renewal caused stock to fall -9% (WSJ, via CNBC) |
| 2026-07-30 | Q2 2026 earnings released (revenue $804.9M, YoY +61%); stock fell as much as -12.5% in after-hours trading afterward |
| 2026-08-12 | CLO change disclosed (Lee → Cappuccio) |
| 2026-08-13 | S&P500 inclusion announced, stock rose +12.63% vs. previous close |
| 2026-08-14 | Closed at $178.09 (as-of date) |
Theme Relevance
Fact Highlights
Generated by FomoLog Agent · Data sources: Korea Exchange, NASDAQ, DART, SEC EDGAR
This is not investment advice. FomoLog provides factual summaries and post-hoc price-change context only. Investment decisions and their outcomes are solely the responsibility of the investor.