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Today's Featured Article TL;DR: Why Reddit is the New Growth Stock to BeatWritten by Nathan Reiff. Published 12/19/2025. 
Key Points - Reddit's revenue and user base have grown at a fast pace in recent quarters.
- Strong performance internationally has helped to fuel these gains, thanks to add-on features like translation tools and more.
- The company's average revenue per user remains low compared to rivals, suggesting that Reddit could continue to boost its appeal to advertisers going forward.
Reddit Inc. (NYSE: RDDT) is ending the year on a high note, having returned about 37% in 2025 after a rally that had stalled earlier in the fall. The online content-sharing platform is showing signs of rapid growth: its user base, earnings, and engagement features are all expanding quickly. At a time when major social media rivals like Meta Platforms Inc. (NASDAQ: META) — and even alternatives such as Pinterest Inc. (NYSE: PINS) — have struggled to outperform the market, Reddit appears to be heating up. This Is the Pentagon's Favorite Startup. And You've Never Heard of It.
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And you can get pre-IPO exposure… with this 4-letter ticker. Click here to see how to get pre-IPO exposure. What might 2026 hold for the popular aggregation site, and can it remain the growth stock to beat? A closer look at user engagement, advertising momentum, and revenue opportunities highlights Reddit's potential going forward. User Engagement Fuels Potential Growth One of Reddit's brightest spots this year has been its engagement gains. The company finished the third quarter with an impressive 116 million daily active uniques (DAUQ) — users who visited reddit.com, opened a related app, or otherwise engaged with its platforms in a 24-hour period — up roughly 20% year-over-year (YOY). Weekly active uniques (WAUQ) grew at a similar pace. International DAUQ rose about 31% YOY, outpacing overall engagement gains thanks to strong adoption in France, Brazil and India. Reddit's business depends on a large, active user base. Higher DAUQ and WAUQ give the company more leverage with advertisers, who account for the majority of revenues. Another underutilized revenue opportunity is data licensing and insights. With some 3.8 billion site visits in September alone, Reddit holds a vast trove of user behavior and community data that could become increasingly valuable in the AI era. Revenue and Earnings Climb, But ARPU Trails Competitors As engagement grows, so has revenue. In the latest earnings, Reddit reported revenue of $585 million — up more than two-thirds YOY — with international revenue growing 74% YOY. Earnings per share (EPS) jumped roughly 400% as both top and bottom lines comfortably beat analyst expectations. Guidance for the final quarter put revenue in a $655 million to $665 million range. Measured per user, average revenue per user (ARPU) was $5.04 in the most recent quarter, up 41% YOY but still well below many rivals (Meta's ARPU, for example, is about three times that level). Boosting ARPU will require more than user growth alone; Reddit must better monetize its large and engaged communities. There is room to raise ARPU by leveraging Reddit's unique content and community dynamics and by improving tools such as auto-translation and content indexing—capabilities that are especially attractive to advertisers seeking diverse, active audiences. AI and Human Content Balance Key to 2026 Outlook Analysts are broadly optimistic heading into the new year, with 18 of 29 coverage ratings at Buy or equivalent. That optimism may be tempered by valuation: with a consensus price target of $230.28, Reddit is approaching the level analysts expect, suggesting limited near-term upside unless the company delivers additional growth catalysts. How Reddit navigates AI adoption will be central to its outlook. So far the company has limited AI-driven features on the user-facing side, and its appeal has largely rested on human-generated content. Maintaining that balance — while rolling out useful AI tools and monetizing data and advertiser-facing products — could help Reddit sustain user growth and further improve monetization. If Reddit can preserve the authenticity that attracts users while expanding advertiser products and data offerings, it may continue to appreciate into 2026 and beyond.
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