Online community and discussion platform Reddit (NYSE: RDDT) will be reporting results this Thursday afternoon. Here’s what to expect.
Reddit beat analysts’ revenue expectations last quarter, reporting revenues of $663.4 million, up 69.1% year on year. It was a very strong quarter for the company, with an impressive beat of analysts’ EBITDA estimates and EBITDA guidance for next quarter topping analysts’ expectations. It reported 53.5 million daily active users, up 6.8% year on year.
Is Reddit a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Reddit’s revenue to grow 46.6% year on year, slowing from the 77.7% increase it recorded in the same quarter last year.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Reddit has a history of exceeding Wall Street’s expectations.
Looking at Reddit’s peers in the consumer internet segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Alphabet delivered year-on-year revenue growth of 24.2%, beating analysts’ expectations by 2.2%, and Netflix reported revenues up 13.4%, in line with consensus estimates. Alphabet traded down 7.1% following the results while Netflix was also down 7.3%.
Read our full analysis of Alphabet’s results here and Netflix’s results here.
There has been positive sentiment among investors in the consumer internet segment, with share prices up 4.2% on average over the last month. Reddit is up 2.7% during the same time and is heading into earnings with an average analyst price target of $227.30 (compared to the current share price of $178.79).
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