On Thursday, Reddit filed for its Initial Public Offering (IPO) with the Securities and Exchange Commission. The social media platform plans to list and trade on the New York Stock Exchange under the ticker symbol “RDDT”, becoming the first major tech IPO of the year and the first social media IPO since Pinterest went public in 2019.
In its filing, Reddit reported annual sales of $804 million for 2023, a 20% increase from its revenue of $666.7 million in the previous year. The majority of the company’s income is generated from online advertising via its website and mobile app.
Founded in 2005, Reddit has been operating at a loss since its inception. The company reported a net loss of $90.8 million for the year ended in December 2023, a decrease from the net loss of $158.6 million seen the year before.
As one of the most-visited websites in the US, the platform has more than 100,000 communities and 73 million daily active users on average; however, it has struggled to establish an online advertising business at a scale comparable to giants like Meta and Alphabet.
In the future, Reddit plans to enhance its search capabilities and leverage artificial intelligence to improve its advertising business. The company is also exploring the monetization of a data-licensing business, which will allow third parties to access and search data on its platform.
Despite its various growth strategies, Reddit predicts fluctuations in its daily active users due to a variety of factors. Nevertheless, the social media platform maintains robust investment activity, having raised approximately $1.3 billion in funding with a post-valuation of $10 billion.
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