Reddit Shares Surge 22% on Earnings Boost and Better-Than-Expected Forecasts

Foreks - Reddit shares surged by 22% in after-hours trading on Tuesday, crossing the $100 mark for the first time after the social media company reported third-quarter results that exceeded analyst expectations and issued an optimistic forecast for the current period.

Earnings per share came in at a profit of 16 cents, compared to the anticipated loss of 7 cents, while revenues were reported at $348.4 million against an expectation of $312.8 million.

Reddit stated that its fourth-quarter revenues are expected to be between $385 million and $400 million, surpassing the average analyst estimate of $357.9 million. Adjusted earnings for the fourth quarter are projected to be in the range of $110 million to $125 million, exceeding the average estimate of $85.2 million.

Revenue in the third quarter increased by 68% year-over-year, with the company reporting a net income of $29.9 million, reversing from a net loss of $7.4 million in the same quarter last year.

The company noted that its daily active user count rose by 47% year-over-year to reach 97.2 million in the third quarter, which was better than analysts' expectations of 96.5 million. Average revenue per user for the third quarter was recorded at $3.58, exceeding analysts' prediction of $3.24.