Online community and discussion platform Reddit (NYSE: RDDT) will be reporting results this Thursday after market hours. Here’s what you need to know.
Reddit beat analysts’ revenue expectations by 17.2% last quarter, reporting revenues of $499.6 million, up 77.7% year on year. It was an exceptional quarter for the company, with EBITDA guidance for next quarter exceeding analysts’ expectations and a solid beat of analysts’ EBITDA estimates. It reported 50.3 million daily active users, up 10.5% 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, analysts are expecting Reddit’s revenue to grow 58% year on year to $550.4 million, slowing from the 67.9% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.05 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Reddit has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time over the past two years by 10% on average.
Looking at Reddit’s peers in the consumer internet segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Booking delivered year-on-year revenue growth of 12.7%, beating analysts’ expectations by 3.1%, and Coursera reported revenues up 10.3%, topping estimates by 2.1%. Coursera traded down 12.7% following the results.
Read our full analysis of Booking’s results here and Coursera’s results here.
Investors in the consumer internet segment have had fairly steady hands going into earnings, with share prices down 1.9% on average over the last month. Reddit is down 11.2% during the same time and is heading into earnings with an average analyst price target of $226.96 (compared to the current share price of $214.78).
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