Reddit Exceeds Q4 Earnings Estimates, Announces Buyback
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Should l Buy RDDT?
Source: Benzinga
- Earnings Beat: Reddit reported Q4 revenue of $725.61 million, surpassing the consensus estimate of $665.44 million, reflecting strong user growth and revenue performance with a 70% year-over-year increase.
- Profitability Improvement: The company posted earnings of $1.24 per share, exceeding analyst expectations of $0.95, indicating significant progress in cost control and operational efficiency, which bolsters investor confidence.
- Strong Cash Flow: Reddit generated $267 million in operating cash flow and $264 million in free cash flow for the quarter, ending with approximately $2.48 billion in cash and marketable securities, ensuring future investment capacity.
- Buyback Program: Reddit announced a share repurchase program of up to $1 billion, with Q1 revenue expected between $595 million and $605 million, demonstrating confidence in future growth and commitment to shareholders.
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Analyst Views on RDDT
Wall Street analysts forecast RDDT stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for RDDT is 260.00 USD with a low forecast of 207.00 USD and a high forecast of 325.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
22 Analyst Rating
14 Buy
8 Hold
0 Sell
Moderate Buy
Current: 152.690
Low
207.00
Averages
260.00
High
325.00
Current: 152.690
Low
207.00
Averages
260.00
High
325.00
About RDDT
Reddit, Inc. operates a social platform, Reddit. Reddit is a community of communities. It is built on shared interests, passion, and trust and is home to open and authentic conversations on the Internet. Reddit is a global, digital city where anyone in the world can join a community to learn from one another, engage in authentic conversations, explore passions, research new hobbies, exchange goods and services, create new communities and experiences, share a few laughs, and find belonging. Reddit has thousands of communities, endless conversations, and authentic human connections. Communities on Reddit are organized based on specific interests and are called subreddits. Reddit offers real-time access to evolving and dynamic topics, such as sports, movies, news, fashion, and the latest trends. On Reddit, users can submit, vote, and comment on the topics they care about. It has approximately 100,000+ active communities and approximately 101+ million daily active visitors.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Reddit Set to Announce Q4 Earnings on February 5th
- Earnings Announcement Date: Reddit is scheduled to release its Q4 earnings on February 5th after market close, with consensus EPS estimates at $0.93 and revenue expected to reach $667.16 million, reflecting a 56% year-over-year growth.
- Upward EPS Revisions: Over the past three months, EPS estimates have seen five upward revisions with no downward adjustments, indicating increased analyst confidence in the company's profitability, which could positively impact its stock price.
- Revenue Estimate Adjustments: Revenue estimates have experienced 19 upward revisions and one downward revision, showcasing a bullish market sentiment regarding Reddit's growth potential in a competitive social media landscape, likely attracting more investor interest.
- Market Environment Challenges: While Reddit faces growth demands similar to Meta and tougher market challenges, its strong earnings outlook may help maintain competitiveness among investors, especially in light of increasing regulatory scrutiny on social media platforms.
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- User Growth: Daily active unique users rose 19% year-over-year to 121.4 million, exceeding the expected 120.2 million, suggesting sustained platform appeal that could drive future advertising revenue growth.
- Profitability Improvement: Net income for the quarter was $251.6 million, a substantial increase from $71 million a year ago, with earnings per share at $1.24, exceeding analyst expectations of $0.93, reflecting a notable enhancement in the company's profitability.
- Buyback Program: Reddit announced a $1 billion stock buyback plan aimed at enhancing shareholder value and demonstrating confidence in future growth, which is expected to further boost market demand for its shares.
See More
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- Surge in Ad Revenue: The company's ad revenue rose 75% year-over-year to $690 million, demonstrating a sustained demand from clients for advertising, thereby enhancing Reddit's competitiveness in the digital advertising market.
- Strategic Transformation: Co-founder and CEO Steve Huffman stated that Reddit is entering a new era focused on global expansion and product innovation, aiming to convert Reddit's authenticity into greater everyday utility, which will further enhance user experience.
- Positive Market Reaction: Following the earnings report, Reddit's shares surged in extended trading hours, reflecting investor optimism about the company's future growth potential, which may attract more investor attention to its stock performance.
See More
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- Earnings Beat: Reddit's Q4 earnings per share reached $1.24, surpassing the expected $0.94, while revenue of $726 million exceeded the $665 million forecast, indicating robust profitability and market demand.
- Strong Sales Guidance: The company anticipates Q1 2026 sales between $595 million and $605 million, exceeding Wall Street's expectation of $577 million, reflecting confidence in future growth.
- User Growth Slowdown: Although global daily active uniques (DAUq) grew 19% year-over-year to 121.4 million, the 5% growth in logged-in users in the U.S. indicates a slowdown, which may impact future advertising revenue.
- Share Repurchase Program: Reddit announced a $1 billion share repurchase program aimed at enhancing shareholder value and signaling confidence in future growth, further increasing market appeal for its stock.
See More
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- Earnings Beat: Reddit reported Q4 revenue of $725.61 million, surpassing the consensus estimate of $665.44 million, reflecting strong user growth and revenue performance with a 70% year-over-year increase.
- Profitability Improvement: The company posted earnings of $1.24 per share, exceeding analyst expectations of $0.95, indicating significant progress in cost control and operational efficiency, which bolsters investor confidence.
- Strong Cash Flow: Reddit generated $267 million in operating cash flow and $264 million in free cash flow for the quarter, ending with approximately $2.48 billion in cash and marketable securities, ensuring future investment capacity.
- Buyback Program: Reddit announced a share repurchase program of up to $1 billion, with Q1 revenue expected between $595 million and $605 million, demonstrating confidence in future growth and commitment to shareholders.
See More
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- Earnings Announcement Date: Reddit is scheduled to release its Q4 earnings on February 5th after market close, with consensus EPS estimates at $0.93 and revenue expected to reach $667.16 million, reflecting a 56% year-over-year growth.
- Upward EPS Revisions: Over the past three months, EPS estimates have seen five upward revisions with no downward adjustments, indicating increased analyst confidence in the company's profitability, which could positively impact its stock price.
- Revenue Estimate Adjustments: Revenue estimates have experienced 19 upward revisions and one downward revision, showcasing a bullish market sentiment regarding Reddit's growth potential in a competitive social media landscape, likely attracting more investor interest.
- Market Environment Challenges: While Reddit faces growth demands similar to Meta and tougher market challenges, its strong earnings outlook may help maintain competitiveness among investors, especially in light of increasing regulatory scrutiny on social media platforms.
See More
Amazon's Earnings Miss Expectations, Shares Drop
- Amazon Earnings Miss: Amazon reported fourth-quarter earnings of $1.95 per share, falling short of the $1.97 consensus estimate, resulting in a 9% drop in shares, highlighting pressures in the competitive e-commerce landscape.
- Reddit Stock Surge: Reddit's stock rose 4% after its fourth-quarter earnings exceeded expectations, coupled with a $1 billion share buyback program, which is expected to boost investor confidence and enhance future shareholder returns.
- Molina Healthcare Loss: Molina Healthcare posted an adjusted loss of $2.75 per share, leading to a 33% decline in shares, primarily due to pressures from Medicaid premium adjustments and Medicare costs, with full-year revenue projected at $44.5 billion, below the $46.55 billion forecasted by analysts.
- Envista Strong Performance: Envista reported fourth-quarter earnings of 38 cents per share and revenue of $750.6 million, resulting in a 14% increase in shares, with expectations of 2% to 4% core sales growth in 2026, indicating robust performance in the dental products market.
See More
Reddit Reports Strong Q4 Earnings and $1B Buyback Plan
- Earnings Beat: Reddit's Q4 total revenue reached $725.6 million, a 70% year-over-year increase, significantly surpassing the market expectation of $666.7 million, indicating strong market performance and user growth potential.
- User Growth: Daily active unique users rose 19% year-over-year to 121.4 million, exceeding the expected 120.2 million, suggesting sustained platform appeal that could drive future advertising revenue growth.
- Profitability Improvement: Net income for the quarter was $251.6 million, a substantial increase from $71 million a year ago, with earnings per share at $1.24, exceeding analyst expectations of $0.93, reflecting a notable enhancement in the company's profitability.
- Buyback Program: Reddit announced a $1 billion stock buyback plan aimed at enhancing shareholder value and demonstrating confidence in future growth, which is expected to further boost market demand for its shares.
See More
Reddit Reports 70% Revenue Growth in Q4, Shares Surge
- Significant Revenue Growth: Reddit reported total revenue of $726 million for Q4, reflecting a 70% year-over-year increase, surpassing analysts' expectations of $667 million, indicating strong business performance driven by increased ad spending.
- Surge in Ad Revenue: The company's ad revenue rose 75% year-over-year to $690 million, demonstrating a sustained demand from clients for advertising, thereby enhancing Reddit's competitiveness in the digital advertising market.
- Strategic Transformation: Co-founder and CEO Steve Huffman stated that Reddit is entering a new era focused on global expansion and product innovation, aiming to convert Reddit's authenticity into greater everyday utility, which will further enhance user experience.
- Positive Market Reaction: Following the earnings report, Reddit's shares surged in extended trading hours, reflecting investor optimism about the company's future growth potential, which may attract more investor attention to its stock performance.
See More
Reddit Reports Strong Q4 Earnings and Guidance
- Earnings Beat: Reddit's Q4 earnings per share reached $1.24, surpassing the expected $0.94, while revenue of $726 million exceeded the $665 million forecast, indicating robust profitability and market demand.
- Strong Sales Guidance: The company anticipates Q1 2026 sales between $595 million and $605 million, exceeding Wall Street's expectation of $577 million, reflecting confidence in future growth.
- User Growth Slowdown: Although global daily active uniques (DAUq) grew 19% year-over-year to 121.4 million, the 5% growth in logged-in users in the U.S. indicates a slowdown, which may impact future advertising revenue.
- Share Repurchase Program: Reddit announced a $1 billion share repurchase program aimed at enhancing shareholder value and signaling confidence in future growth, further increasing market appeal for its stock.
See More
Reddit Exceeds Q4 Earnings Estimates, Announces Buyback
- Earnings Beat: Reddit reported Q4 revenue of $725.61 million, surpassing the consensus estimate of $665.44 million, reflecting strong user growth and revenue performance with a 70% year-over-year increase.
- Profitability Improvement: The company posted earnings of $1.24 per share, exceeding analyst expectations of $0.95, indicating significant progress in cost control and operational efficiency, which bolsters investor confidence.
- Strong Cash Flow: Reddit generated $267 million in operating cash flow and $264 million in free cash flow for the quarter, ending with approximately $2.48 billion in cash and marketable securities, ensuring future investment capacity.
- Buyback Program: Reddit announced a share repurchase program of up to $1 billion, with Q1 revenue expected between $595 million and $605 million, demonstrating confidence in future growth and commitment to shareholders.
See More
