Reddit beat expectations and gave guidance for the start of 2026 in its latest earnings release.
The social media site’s fourth-quarter revenue soared 70% to US$726 million, far exceeding expectations of $665 million.
Net income had an even bigger jump of 255% from $252 million to $181 million last year.
Revenue accounted to 35% of this, with Reddit’s sales in the U.S. coming in at $583 million, topping analysts' estimates of $529 million.
Earnings per share blew past expectations of 94 cents, coming in at $1.24 per share.
Following positive earnings for Q4 2025, the company estimates revenue within the range of $595 million and $605 million for the first quarter of 2026. This is higher than Wall Street analysts' expectations of $577 million.
The number of daily users also grew 19% year-over-year to 121.4 million, ahead of analysts' predictions of 120 million.
The company said that logged-in daily active users from the U.S., referring to users who were signed into accounts, rose 5% year-over-year to 23 million, paling in comparison to the third quarter growth of 7%.
This marks the sixth straight quarter where Reddit’s U.S. logged-in user growth has slowed.
Investors monitor this metric as logged-in users are more lucrative to the company’s online and advertising business.
However, Reddit CEO Steve Huffman said the company plans to phase out reporting on logged-in and logged-out later this year, as there is less distinction between the two metrics than in the past.
“As the industry evolves, how we think about our product and users must evolve too,” Huffman said.
“We’ve historically reported logged-in vs. logged-out users, but as some of our work to streamline onboarding — instant personalisation, for example — blurs the line between these states, the distinction between them makes less sense.”
The metrics will still be reported in the first two quarters of 2026.
At the time of writing, Reddit (NYSE: RDDT) stocks were down 1.07% to $151.05. Its market cap is $28.6 billion.
