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What this page is: Delvantic's full research page for Reddit Inc Class A (RDDT) — AI-driven forensic equity research: mechanical valuation models (DCF, EPV, anchored-PE, scenario) plus three independent AI lenses (Quality / Value / Sentiment). Everything below is rendered server-side; you are not missing content that requires JavaScript. All scores are predictions and research opinions, not financial advice.
Our current read (analysis of 2026-08-23): Designation Low · Gem Score -42 (−100…+100 Quality+Value blend) · Quality -3 · Value -73 · Sentiment 28 (timing only, not weighted)
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profile-header/price-overview— company profile, live quote, market capextended-analysis— the core: three AI lens reads with findings, scores, and the analyst memofuture-predictions— our forward price-band predictionsmarket-narrative/ai-findings/gpt-critique— narrative context, cross-model findings, and an adversarial critique of our own analysis (near the end of the document)- Members-only sections (render as login gates for anonymous readers):
price-history,income-trend,key-metrics,financials(statement tables),insider-trading. The analysis above is public; the raw data tables require a free account.
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raw inputs are public-company filings and market data (via licensed data feeds);
every model, score, lens read, and prediction on this page is Delvantic's own analysis.
Reddit Inc Class A
RDDT NYSEReddit Inc Class A represents equity in a social media and online community platform operator based in San Francisco, California. The company runs Reddit, a network of interest-based communities where users post, comment, vote, and share content across topics ranging from news and finance to entertainment, gaming, technology, and niche hobbies. Its platform is structured around “subreddits,” user-created forums that organize conversations and media, supported by volunteer moderators and community rules. Reddit Inc today focuses on enabling discovery of relevant content, real-time discussion, and peer-to-peer knowledge sharing for a global audience. The company generates revenue primarily through digital advertising formats tailored to its community environment, as well as premium memberships and data licensing arrangements for enterprise clients and researchers. Operating within the communication services sector and the internet content and information industry, Reddit Inc Class A plays a significant role as a large-scale, community-driven destination for online engagement and social discourse worldwide.
Price Overview
Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 2.62
Total Equity: $2.93B
Shares: 202,107,978
Total Debt: $0.00
Cash: $953.57M
EBITDA: $457.93M
Total Debt: $0.00
Cash: $953.57M
Revenue: $2.20B
Revenue: $2.20B
Revenue: $2.20B
Total Equity: $2.93B
Tax Rate: -0.2%
Equity: $2.93B
Total Debt: $0.00
Cash: $953.57M
Current Liabilities: $271.28M
Long-Term Debt: $0.00
Total Debt: $0.00
Total Equity: $2.93B
Shares: 202,107,978
Shares: 202,107,978
CapEx: -$6.71M
Shares: 202,107,978
Stock Price: $178.69
Net Income: $529.72M
Industry Benchmarks
Income Statement (Annual)
Last updated: Aug 15, 2026 10:31am (8d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue | $666.7M | $804.0M | $1.3B | $2.2B |
| Cost of Revenue | $104.8M | $111.0M | $123.6M | $194.2M |
| Gross Profit | $561.9M | $693.0M | $1.2B | $2.0B |
| Operating Expenses | $734.1M | $833.2M | $1.7B | $1.6B |
| Operating Income | -$172.2M | -$140.2M | -$560.6M | $442.0M |
| Net Income | -$158.6M | -$90.8M | -$484.3M | $529.7M |
| EBITDA | -$164.2M | -$126.5M | -$544.9M | $457.9M |
| EPS | $-2.77 | $-1.54 | $-3.33 | $2.84 |
| EPS (Diluted) | $-2.77 | $-1.54 | $-3.33 | $2.62 |
Balance Sheet (Annual)
Last updated: Aug 15, 2026 10:09am (8d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | — | $435.8M | $401.2M | $562.1M | $953.6M |
| Total Current Assets | — | — | $1.5B | $2.2B | $3.1B |
| Total Assets | — | — | $1.6B | $2.3B | $3.2B |
| Current Liabilities | — | — | $133.6M | $176.0M | $271.3M |
| Long-Term Debt | — | — | — | — | — |
| Total Liabilities | — | — | $155.9M | $205.8M | $310.1M |
| Total Equity | $1.6B | $1.5B | $1.4B | $2.1B | $2.9B |
| Retained Earnings | — | — | -$716.6M | -$1.2B | -$671.1M |
Cash Flow (Annual)
Last updated: Aug 15, 2026 10:31am (8d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Operating Cash Flow | -$94.0M | -$75.1M | $222.1M | $690.9M |
| Capital Expenditure | -$6.2M | -$9.7M | -$6.2M | -$6.7M |
| Free Cash Flow | -$100.3M | -$84.8M | $215.8M | $684.2M |
| Acquisitions (net) | -$42.2M | $0 | -$17.1M | $0 |
| Net Debt Issued / (Repaid) | — | — | — | — |
| Dividends Paid | — | — | — | — |
| Stock Buybacks | — | — | — | — |
| Net Change in Cash | -$902.0M | -$34.6M | $160.9M | $391.4M |
Growth Trends (YoY %)
Last updated: Aug 15, 2026 10:31am (8d ago)| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Revenue Growth | +20.6% | +61.7% | +69.4% |
| Gross Profit Growth | +23.3% | +69.8% | +70.7% |
| Operating Income Growth | +18.6% | -299.9% | +178.8% |
| Net Income Growth | +42.7% | -433.2% | +209.4% |
| EBITDA Growth | +23.0% | -330.9% | +184.0% |
Deep Analysis
Narrative Economics
market-narrative step).
AI Lens 4th lens · how AI reaches this business · 5-yr
2026-08-15As machine-written text floods the open web, an archived, rights-clean corpus of two decades of moderated human opinion and lived experience becomes relatively scarcer — and Reddit can monetize it twice: as licensed training/grounding data at near-100% margin and as the citation source models must reach for on subjective, experiential queries.
A large share of Reddit's session volume arrives via Google; AI Overviews and assistant answers can satisfy the query by summarizing Reddit content without delivering the visit, which severs the corpus's value from the ad impression that actually monetizes it.
Whether AI-mediated discovery sends users INTO Reddit threads or answers them outside it — observable in logged-out DAU trend and the ad-impression growth rate versus data-licensing revenue growth.
Twenty years of topic-specific communities with unpaid moderator labor, ranked vote signal, and the social norm that people post honest experience — plus the legal right to license that archive, which scrapers do not hold.
AI Lens thesis
AI reaches Reddit through three separate channels that must be scored apart: (1) it makes Reddit's back-catalog an input good — licensing and grounding revenue at essentially zero marginal cost, structurally favorable; (2) it attacks the monetized unit, because Reddit charges for ad impressions generated by sessions, and assistants can consume the corpus and answer the user elsewhere, breaking the link between content value and revenue; (3) it upgrades Reddit's own weakest asset — an ad stack far behind Meta's — where cheap intelligence lifts targeting, creative generation, self-serve onboarding and moderation on a 91% gross margin base that just flipped to 20% operating margin. The bull path is that Reddit becomes the human-substrate layer AI must pay for AND builds its own answer surface so intent stays inside; the bear path is that licensing plateaus into a small oligopsony-priced line item while search-sourced sessions erode and AI-generated posts dilute the very authenticity that makes the corpus worth licensing.
What the market may be underestimating
Upside Reddit's ad business is still primitive relative to its audience; AI-driven ranking, automated creative and self-serve conversion tooling can lift ARPU materially on a 91% gross margin base, which is a cost-free margin story independent of the data-licensing narrative.
Downside Licensing counterparties are two or three buyers who also control Reddit's traffic — the same firm can renegotiate the data contract down while its AI answers reduce the referrals; and AI-written posts degrading corpus authenticity would erode both the license's value and moderator willingness to keep working for free.
Outcome range spread 63 · unresolved
Growth Outlook
Analyzed 2026-08-17 16:21The question every valuation on this page silently assumes: is this company likely to grow? Judged forward — the business, its category, the world — against what's already printed.
Claude Reading
Looking at the raw quarterly cadence first: revenue went $348M → $392M → $500M → $585M → $726M → $663M → $805M across the last seven quarters. That's a 131% jump from Q3'24 to Q2'26, with net margins expanding from 8.6% to 31.4%. But the sequence Q4'25 $726M → Q1'26 $663M is a real sequential decline (seasonality — Q4 ad seasonality is real), and the Q2'26 rebound to $805M is only +11% sequential. The YoY comps are still monster (69% recent), but the two-quarter run-rate ($1.47B H1'26 annualizes to ~$2.94B) is decelerating from the exit-Q4'25 pace. Margins holding 30%+ for three straight quarters is the genuinely impressive fact — this isn't a one-quarter licensing pop, it's a pattern. FCF of $684M on $2.2B revenue (31% FCF margin) with essentially zero capex ($6.7M) is a structurally beautiful model if it holds.
Where I push back on the prior stack: the synthesis "fair_value" verdict at $169.64 signal-adjusted vs $178.69 spot is doing a lot of work with a signal adjustment from a $126.67 composite — a 34% upward nudge on "signals" is basically the model conceding the DCF can't handle the growth curve and defaulting to narrative. Meanwhile Market Forces flags the AI licensing as non-recurring, and Thesis Evaluation scores -5 with bear mass slightly exceeding bull. These aren't reconcilable — one framework says "priced fairly, maybe cheap," the other says "earnings quality is fake." I side closer to Market Forces on the risk framing but disagree with the "unsustainable" characterization: Google's ~$60M/yr and Anthropic/OpenAI-tier deals are multi-year contracts, and even if they don't renew at the same rate, the ad business (which is the bulk of the $805M Q2) is now demonstrably profitable at scale. The Narrative layer claiming price sits "23-35% below DCF" is stale — it references $130-140, but spot is $178.69, so that discount is gone; the market has closed the gap and then some.
The contrarian case a skeptic should press: at 14.6x EV/sales and 70x EV/EBITDA, you're paying platform-monopoly multiples for a company that (a) still has DAU growth that wobbles quarter to quarter, (b) has never had to defend ad revenue in a genuine recession as a public company, (c) faces Google AI Overviews cannibalizing the search-referral traffic that drives a meaningful chunk of Reddit sessions, and (d) has insider selling clustered on 2026-07-15 (multiple sales, one option exercise — small individually but the pattern is distributional, not accumulation). The bull math requires ~60% revenue CAGR sustained through 2030 to justify $178; even a decel to 35-40% CAGR with margin holding gets you to ~$5B revenue by 2029 and, at a more mature 8-10x sales, a $40-50B market cap — call it $235-290/share in three years, ~12-18% IRR. That's fine, not spectacular, and it assumes nothing breaks. If licensing revenue halves and ad growth normalizes to 25%, fair value is closer to $120-135.
GPT Reading
The raw numbers say Reddit has gone from speculative turnaround to real business frighteningly fast. Revenue has stepped from $348.4M in 2024-09 to $427.7M, $392.4M, $499.6M, $584.9M, $725.6M, $663.4M and then $804.9M in 2026-06; on a trailing four-quarter basis that is roughly $2.78B, more than double 2025’s $2.20B annual revenue run. More important, this is not just an accounting profit story anymore. Net income margins moved from 8.6% and 16.6% in late 2024 to 27.8%-34.7%-30.7%-31.4% across the last four quarters. Annual operating income swung from a loss of $560.6M in 2024 to a gain of $442.0M in 2025, while free cash flow hit $684.2M with only $6.7M of capex. A debt-free balance sheet with $953.6M cash means there is no financing fragility here. If I strip away the narrative and just read the income statement progression, this looks like a platform that found a much better monetization engine and is now showing software-like incremental margins on top of a community asset that was previously under-earning.
What stands out to me is that the market is not crazy to pay a premium, but it is paying for a continuation of an exceptionally hot streak. At $30.4B market cap, the stock trades around 11x trailing annualized revenue using the last four quarters, not the stale 2025 figure, and roughly 40x-45x an annualized earnings run-rate if you take the last four quarters’ $870M-ish net income at face value. That is rich, but not absurd for a business growing revenue about 60%-70% year over year while already above 30% net margin. The contradiction I see versus some of the more skeptical model output is that “cash flow quality is poor” is not supported by the actual cash data given here; operating cash flow of $690.9M versus net income of $529.7M in 2025 is fine, even strong. The more relevant issue is not cash conversion but durability: are those 30% margins the new base, or are they inflated by high-margin licensing economics that do not scale linearly? On the evidence provided, I lean to the former more than the market skeptics do, because the profit improvement has persisted through multiple quarters rather than appearing as a single spike.
Still, I do not get to “cheap” at $178.69. Even using the stronger 2026 run-rate, the stock is being valued as if Reddit can become a $5B-$6B revenue business within a few years while keeping operating leverage intact. That may happen, but the bar is high because the company has only about seven quarters of demonstrated profitability, and the quarterly revenue path is not perfectly smooth: $725.6M in 2025-12 dropped to $663.4M in 2026-03 before rebounding to $804.9M, which suggests at least some lumpiness. The annual gross margin of 91.2% is excellent, but also means almost all future upside has to come from scaling sales efficiently rather than further gross-margin expansion. Paying 12.3x book is irrelevant for a business like this, but 14.6x EV/revenue and 70x EV/EBITDA on reported annual figures tell you the market already recognizes the transformation. My read is that this is a very good company stock, but no longer an obviously mispriced one.
The best bear case against my relatively constructive operating read is simple: 2025 may have been the year Reddit harvested unusually favorable economics from the AI data land-grab, and investors are annualizing that too aggressively. If a meaningful share of the jump from $1.30B revenue in 2024 to $2.20B in 2025 came from licensing rather than core ad monetization, then the current margin structure could overstate steady-state earnings power. The valuation would then be much harsher than my run-rate framing implies, and the models warning about sustainability would be right. A smart opponent would also point out that a social platform at $30B should probably have a cleaner record of user and ad-pricing durability before trading at over 10x forward-ish sales. Insider activity is not a smoking gun, but the recent cluster of sales after option exercise is at least consistent with management taking advantage of a strong tape rather than signaling obvious upside from here.
What would change my mind is pretty specific. If the next two quarters show revenue growth falling below 35%-40% year over year while net margin slips back toward the mid-teens, then I would conclude 2025-26 profitability was flattered by transient mix and the stock is overvalued above $150. On the other hand, if Reddit can sustain quarterly revenue above $800M, exit 2026 at a $3.4B-$3.6B annualized revenue run-rate, and keep net margins around 25%+ without a licensing step-down, then today’s multiple starts to look much more supportable and I would be willing to underwrite a valuation north of $200. For now, the business momentum is real, but the stock already asks you to believe a lot of that momentum is durable.
Grok Reading
Reddit’s numbers describe a business that flipped from structural loss-maker to high-margin cash compounder in roughly six quarters. Annual revenue went from $1.30B and a $484M net loss in 2024 to $2.20B and $530M of net income in 2025; trailing-twelve-month revenue is already ~$2.78B with ~$871M of net income once the two most recent quarters are included. Sequential print of $804.9M in the June 2026 quarter at a 31.4% net margin, against $499.6M and 17.9% a year earlier, shows both top-line momentum (~61% YoY) and operating leverage that is still expanding. Gross margin sits at 91%, free cash flow was $684M on essentially zero capex, the balance sheet carries no debt and nearly $1B of cash, and ROIC has reached 22%. That is elite software economics attached to a still-accelerating ad-and-data platform, not a one-quarter fluke.
The valuation layer is less forgiving once the run-rate is normalized. On 2025 earnings the stock screens at 68×; on the fresher TTM earnings base it is closer to 35× with an EV/sales multiple near 11× and a free-cash-flow yield of roughly 2.2%. Those multiples embed continued 40%+ growth and mid-20s-or-better margins for several years. Quarterly growth remains high but the secondary signals already flag deceleration, and the market-forces overlay correctly highlights that a non-trivial slice of the 2025–26 profit surge is likely tied to AI data-licensing contracts whose duration and renewability are opaque. Insider activity on 15 July 2026 was almost entirely option-exercise followed by sales—neutral rather than alarming—yet it does nothing to underwrite multi-year durability of the licensing line. At $178.69 the stock is therefore pricing a clean execution path that the underlying data only partially confirm.
The strongest contrary case is simply that the operational trajectory is still too strong to fade. A business printing 60%+ revenue growth, 30%+ net margins, and nearly 100% free-cash-flow conversion with a fortress balance sheet rarely stays “fairly valued” for long if those metrics hold; any re-acceleration in ad ARPU or a multi-year extension of the major AI contracts would justify a re-rating toward 45–50× forward earnings and push the shares well above $220. The rule-based archetype of high-growth-profitable and the 65% revenue CAGR are not fabrications, and the narrative of Reddit as the last large corpus of authentic human text retains real scarcity value. I weigh those points seriously, but discount them because the same data set shows FCF quality already flagged as poor, revenue confidence marked “decelerating,” and the thesis-evaluation engine itself sitting at a net –5 score with the dominant bear weight on temporary AI land-grab economics. The market has already paid for the best version of the story.
What would flip the view is straightforward: two more quarters of ≥50% YoY revenue growth with net margins holding above 28% and explicit disclosure that AI licensing is multi-year take-or-pay rather than one-off; that combination would force a higher fair-value band. Conversely, a single quarter in which revenue growth drops below 35% while licensing revenue is shown to be rolling off would confirm the quality concern and open 20–25% downside toward the mid-$130s.
Big-3 Panel — where each AI stands
Advanced Analysis Forensic deep-dive · separate lenses
The business inflected hard in 2025: revenue jumped from $1.30B to $2.20B (69% growth), gross margin expanded to 91.2%, and operating margin swung from -43.1% to +20.1%. Net income went from a $484M loss to $530M profit and FCF hit $684M. That is a genuinely differentiated turn in operating economics and, combined with $954M cash, no debt, and Altman Z of 60.8, survival is not a question. The 91%+ gross margin and swing to operating leverage suggest the platform is enjoying real fixed-cost absorption as ad revenue scales. However, the per-share story is far weaker than the aggregate story. Diluted shares went from 57M (2022) to 202M (2025) - a 52% CAGR, some of it IPO mechanics but ongoing SBC at 15.6% of revenue ($343M run-rate) is a very large real cost that GAAP now captures but 'adjusted' metrics do not. OCF/NI of 0.57x and accruals at -12.1% of assets suggest reported net income is running ahead of cash conversion, likely flattered by deferred-tax or one-time items in the swing year. Insider tape is all sales / option exercises (44 sells, 0 buys, $24M), consistent with post-lockup monetization rather than a bearish signal, but there is zero insider conviction on the buy side. Net: a high-quality, high-margin platform in an operating-leverage sweet spot, paired with dilution discipline that is genuinely poor and earnings quality that deserves another year of confirmation.
Verify before trusting this (5)
- Composition of the 2025 net income swing - how much came from a deferred tax valuation-allowance release vs operating income
- SBC schedule and expected dilution glide path over the next 2-3 years; any 10b5-1 buyback authorization
- Ad revenue customer concentration and share from data-licensing / AI training deals (durability of that revenue line)
- Whether the diluted share jump from 145.5M to 202.1M reflects lockup expiry or ongoing grant velocity
- DAU/user growth vs revenue - is monetization per user driving the inflection or user growth
The e2e composite fair value is $126.67 and the signal-adjusted FV is $169.64 versus a $178.09 price, so the upside is negative on both anchors. The DCF says $81 and the EPV floor is a rounding error at $2 - both flag that current cash flows do not remotely support the quote; only the anchored-PE at $233 (a multiple-on-recent-earnings method that extrapolates the 2025 profit inflection) argues for upside, and that method is the one most exposed to being wrong if growth decelerates as the bears argue. Averaging honestly, deserved value clusters in the $130-170 range.
Verify before trusting this (5)
- Ad revenue growth trajectory and any deceleration in guidance
- AI/data licensing revenue run-rate and contract renewals
- SBC as % of revenue trend and any buyback authorization
- Diluted share count trajectory post-lockup
- Operating margin durability beyond the 2025 inflection
RDDT is sitting in a rare sentiment sweet spot: a hard, near-term mechanical catalyst (S&P 500 inclusion on Aug 18) landed on a stock that was down ~24-28% YTD and hated. The Friday +12.6% pop to $178.09 shows how thin the float of willing sellers is versus forced index-fund buying, and with beta 2.03 into a risk-on tape (VIX 14.3, S&P near highs) the amplification is real. The narrative arc has flipped from 'growth decelerating, AI search referrals collapsing' (the July 31 -21% print) to 'validated large-cap platform monopoly' in two weeks.
Verify before trusting this (4)
- Price action Aug 18-22 post-inclusion (does forced bid unwind into supply?)
- Any updated commentary on Google/AI search referral trends
- Analyst target revisions in the week after inclusion
- Whether narrative shifts from 'index milestone' back to 'growth deceleration' by next print
AI reaches Reddit through three separate channels that must be scored apart: (1) it makes Reddit's back-catalog an input good — licensing and grounding revenue at essentially zero marginal cost, structurally favorable; (2) it attacks the monetized unit, because Reddit charges for ad impressions generated by sessions, and assistants can consume the corpus and answer the user elsewhere, breaking the link between content value and revenue; (3) it upgrades Reddit's own weakest asset — an ad stack far behind Meta's — where cheap intelligence lifts targeting, creative generation, self-serve onboarding and moderation on a 91% gross margin base that just flipped to 20% operating margin. The bull path is that Reddit becomes the human-substrate layer AI must pay for AND builds its own answer surface so intent stays inside; the bear path is that licensing plateaus into a small oligopsony-priced line item while search-sourced sessions erode and AI-generated posts dilute the very authenticity that makes the corpus worth licensing.
None surfaced.
Verify before trusting this (8)
- Citation-to-click conversion from AI surfaces
- Google referral share disclosures
- Per-query compensation structures emerging
- Logged-out DAU trajectory
- Search-referred share of sessions
- Reddit Answers usage and retention
- Renewal terms on data licenses
- Number of distinct licensing counterparties
Two forces are pulling on the same asset in opposite directions. Digital advertising is consolidating toward platforms with first-party intent signal and measurable conversion, which favors Reddit as it finishes the transition from brand-experiment budgets to always-on performance budgets — that is the near-term engine and it is well understood. Simultaneously, the retrieval layer of the internet is being rebuilt around generated answers rather than blue links. Reddit sits on both sides of that shift: its corpus is a scarce input the model builders pay for, but the same shift threatens the logged-out search-referral funnel that feeds a meaningful slice of its audience. So the licensing line is partly a hedge against, and partly a payment for, the erosion of its own traffic source. The honest structural read is a business with genuine scarcity of supply (authentic human conversation, moderated niche communities) and an under-monetized international base — that combination supports many years of above-category growth — set against a distribution channel it does not control and an arithmetic base that is now large. Macro ad-spend headwinds are a modulator, not a determinant.