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Just For You TL;DR: Why Reddit is the New Growth Stock to BeatAuthor: Nathan Reiff. Article Posted: 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 flattened 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 smaller peers such as Pinterest Inc. (NYSE: PINS) — have struggled to outperform the market this year, Reddit appears to be heating up. Elon Musk's Starlink project is generating major speculation ahead of a potential IPO that some analysts believe could reach a historic $100 billion valuation. According to James Altucher, there may be a smart "backdoor" way for everyday investors to position ahead of that event without needing traditional IPO access — and he says it can be done for under $100. He's also sharing a free ticker tied to this trend for anyone who wants to take a closer look. Click here to learn more What might 2026 hold for the popular aggregation site, and will 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 closed the third quarter with 116 million daily active uniques (DAUQ) — users who visit reddit.com, open a related app, or otherwise engage with the platform in a 24‑hour period — a roughly 20% year‑over‑year increase. Weekly active uniques (WAUQ) rose by a similar amount. International DAUQ grew about 31% YOY, outpacing overall gains thanks to strong user growth in France, Brazil and India. Reddit's business depends on scale, and growth in DAUQ and WAUQ strengthens its position going forward. With more users, Reddit gains greater leverage with advertisers, who account for the majority of the company's revenue. A relatively untapped revenue opportunity is Reddit's data. With roughly 3.8 billion site visits in September alone, the company sits on extensive user data that could be increasingly valuable as demand for AI and audience insights rises. Revenue and Earnings Climb, But ARPU Trails Competitors As engagement grows, Reddit's revenue has surged. In the latest earnings, revenue reached $585 million, more than two‑thirds higher year‑over‑year. International revenue was especially strong, rising 74% YOY. EPS jumped about 400% over the same period, with both top and bottom lines comfortably beating analyst expectations. Guidance for the final quarter put revenue between $655 million and $665 million. Average revenue per user (ARPU) stood at $5.04 in the last quarter, up 41% YOY but still well below many competitors — Meta's ARPU, for example, is roughly three times higher. Improving ARPU will require more than user growth alone. Reddit can raise ARPU by better monetizing its unique content and communities and by deploying tools such as auto‑translations, improved search and indexing, and advertiser‑facing analytics — features that are especially appealing to brands seeking diverse, active audiences. AI and Human Content Balance Key to 2026 Outlook Analysts are generally optimistic heading into the new year, with 18 of 29 assigning Reddit a Buy or equivalent rating. Following the year‑end rally, short‑term upside is unclear — at a consensus price target of $230.28, Reddit is already approaching the level analysts expect. A key to further upside will be how Reddit navigates AI. So far the company has limited visible AI features for users, and emphasizing human‑generated content has helped broaden its appeal. If Reddit continues to strike a balance between robust user content and helpful tools while preserving the platform's appeal to a wide audience, it could sustain momentum into 2026 and beyond.
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