Reddit (NYSE:RDDT) has experienced a remarkable increase in share value, rising 229% since its initial public offering (IPO) in March 2024. The company was valued at $6.4 billion at the time of the IPO, with shares priced at $34. Currently, Reddit's market capitalization stands at $28.6 billion.
As of the latest trading session, RDDT shares closed at $167.08, reflecting a 128.94% return to investors over the past six months. The stock reached an all-time high of $179.49 last Monday, significantly surpassing the 52-week average of $81.06.
Reddit's user growth has been substantial, with 97.2 million daily active users reported for Q3 2024, marking a 47% year-over-year increase. The platform's search traffic volume has also surged, ranking 6th worldwide with 762.1 million searches valued at $386.4 million.
Following the IPO, Reddit reported its first profitable quarter, ending October 2024, with a net income of $30 million and a 68% increase in revenue to $348.4 million. The company's gross margin improved to 90.1%, and free cash flow turned positive at $70.3 million.
Despite these successes, Reddit faces growth limitations, including geographical constraints, technical challenges related to high-traffic subreddits, and concerns over content moderation bias. Analysts are optimistic about Reddit's potential for further growth, especially with plans to enhance its search functionality in 2025.