Reddit users have helped fuel dozens of “meme” stock rallies this year, from retailer GameStop Corp to movie operator AMC Entertainment Holdings Inc. Some analysts are skeptical this will be the social media platform’s saving grace as it prepares to sell its own shares in the stock market.filed confidentially this week with U.S.
A Reddit spokesperson declined to respond to industry analysts’ skepticism of its public company’s growth prospects, citing the “quiet period” that accompanies the filing of paperwork with the Securities and Exchange Commission. Reddit brought in $100 million in advertising revenue in the second quarter of this year, according to the company. That reflects a tripling from a year ago, or about $400 million annually on a run-rate basis, serving about 52 million users daily.
This is because Facebook and YouTube lure marketers with highly targeted text and video ads that are designed to drive sales. Reddit’s users have also been critical of the platform carrying too much advertising. Drawing more users will require new features as Reddit’s rivals chase the metaverse, virtual reality, audio chatrooms and newsletters, analysts said.