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reddit Shares rose 5% in after-hours trading Thursday after the company reported fourth-quarter results that beat revenue and bottom line and gave a strong outlook for early 2026.
Here’s how LSEG’s estimates compare to the company’s performance.
Earnings per share: $1.24 vs. 94 cents expected Earnings: $726 million vs. $665 million expected
The company said it expects first-quarter sales to be in the range of $595 million to $605 million, higher than Wall Street’s estimate of $577 million. Adjusted earnings for the first quarter are expected to be between $210 million and $220 million, beating Street estimates of $203 million.
Reddit also announced a $1 billion stock buyback program.
The company’s fourth quarter revenue increased 70% year-over-year, and net income rose approximately 255% year-over-year to $252 million.
Reddit’s revenue in the U.S. market in the fourth quarter was $583 million, exceeding analysts’ expectations of $529 million.
The company’s global daily active uniques (DAUq) rose 19% year-over-year to 121.4 million in the fourth quarter, exceeding Wall Street’s expectations of 120 million.
In the fourth quarter, U.S. DAUq rose 9% year-over-year to 52.5 million, slightly exceeding analysts’ expectations of 52.3 million.
According to the company, login DAUq (referring to users who have registered a Reddit account) in the U.S. increased by 5% year-on-year to 23 million. This number was slower than the 7% year-over-year growth that Reddit said it recorded in the third quarter, when login DAUq in the U.S. reached 23.1 million people. This is the sixth consecutive quarter that Reddit’s growth in US logged-in users has slowed.
Investors have been monitoring Reddit’s login DAUq metric because users who create accounts are more profitable for the company’s online advertising business. These Reddit account holders typically use the platform and interact with other users more frequently than users who may have stumbled onto Reddit. google The company calls this Logout DAUq.
Reddit CEO Steve Huffman said in a letter to investors that the company plans to “phase out reporting on logins and logouts later this year” because the two metrics are now less distinct than before. That’s because the company is working on features aimed at keeping both logged-in and logged-out users glued to the platform, Huffman said.
“As the industry evolves, the way we think about products and users must also evolve,” Huffman wrote. “We have traditionally reported logged-in and logged-out users, but some of our efforts to streamline onboarding (e.g., instant personalization) have blurred the lines between these states, making the distinction between them less meaningful.”
Reddit’s head of finance, Drew Borrello, told analysts on an earnings call that the company will continue to report both metrics for the first two quarters of 2026.
About the company’s data license agreement google Huffman said on the earnings call that “the relationship with both companies is very healthy” and that “the conversation is moving from a pure business deal to a product partnership.”
“Specifically, what we’re looking for in a relationship like this is being able to engage users in the community part of Reddit,” Huffman said.
Regarding Reddit’s efforts to integrate traditional search tools with modern generative AI search capabilities, Huffman said the company has learned that “GenAI’s search results are more relevant for most queries.”
Unlike traditional search, the cutting-edge GenAI search and chat tool excels at providing results that include “multiple perspectives from many people,” he said.
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