Reddit Sees User Growth Acceleration, Offering a Potential Turnaround Signal
Reddit (RDDT) shares rose about 6% on Sept. 10 after Piper Sandler reported an 8% monthly increase in user base for August—the strongest growth of the year and reversing July's decline. The stock remains down significantly over both one-year and YTD periods, raising questions whether this is a real turnaround or just a temporary bounce. The data showed Reddit’s total audience growing at 18% YoY in August compared to 12.8% in July, with international growth rising sharply from 19% to 29.3%. U.S. user growth was more modest but still positive at 5.2%, driven by the Feed segment offsetting a drop in Conversation users. This is crucial for Reddit’s ad business and its ability to reduce reliance on Google referrals. Reddit also reported strong Q2 results, with revenue up 61% YoY to $805 million, advertising revenue rising 64%, net income more than doubling, and cash reserves reaching $2.8 billion. Management expects continued growth in the third quarter.
Topics: Piper Sandler data Reddit stock price movement user growth