Reddit shares soar as earnings show advertising, AI licensing revenue potential

Reddit soared as much as 11% in early trading on Wednesday after the social media firm floored investors with strong revenue growth and improving profitability in the first earnings since its market debut.

The company surprised Wall Street late on Tuesday with a forecast that it could post an adjusted profit in the second quarter, and its revenue outlook was also far above estimates.

The projections followed better-than-expected results for the first three months of 2024, showing that Reddit’s (RDDT.N) push to grow its advertising business and content licensing deals with AI-focused companies such as Google were paying off.