Reddit has become profitable for the first time
Reddit has announced its first-ever profit in the company's nearly two-decade-long history. The social media platform posted a profit of $29.9 million as part of its Q3 earnings results. The financial milestone comes after a long streak of losses for the company since going public, including a $575 million loss in its debut quarter on the market.
Revenue and user base see substantial growth
Along with its profit, Reddit also posted a massive jump in revenue. The company's revenue for the quarter stood at $348.4 million, which is a whopping 68% increase from last year. This financial turnaround came with a major expansion of Reddit's daily user base, which grew to 97.2 million over the last few months — a 47% increase from the same period last year.
Advertising revenue and data licensing agreements
A large chunk of Reddit's revenue came from advertising, which totaled $315.1 million. Another $33.2 million was earned from "other" sources, mainly thanks to data licensing agreements inked earlier this year. Tech giants Google and OpenAI have both signed deals with Reddit to use its posts for training their AI models.
AI-powered translation feature boosts user growth
Reddit CEO Steve Huffman credited the recent user growth to the platform's AI-powered translation feature. First introduced for French translations last year, the feature has now been expanded to Spanish, Italian, Portuguese, and German. Huffman announced plans to expand the service to over 30 countries by 2025.
Reddit's influence and future plans
Huffman also emphasized Reddit's growing influence, saying "Reddit" was the sixth most Googled word in the US this year (so far) in 2024. This indicates that more and more people are coming to Reddit for answers, advice, or community. The company is also working on making its search feature "easier and more intuitive," as part of its continuous efforts to improve user experience and expand its reach.
