What You Need to Know Ahead of Reddit’s Earnings Report

Reddit (RDDT) is set to report its second-quarter earnings after the close of trading on Aug. 6. Investors will likely be watching for growth in user engagement and updates on its artificial intelligence (AI) training licensing agreements.

The company is expected to post revenue of $253.8 million, according to analyst estimates compiled by Visible Alpha, which would represent an increase of about 39% compared to revenue for the same period last year, reported in documents filed with the Securities and Exchange Commission (SEC) ahead of Reddit’s March initial public offering (IPO).

Reddit’s net loss for the second quarter ended June 30 is expected to be $52.82 million, or 32 cents per share, widening the loss of $41.1 million reported in pre-IPO filings for the same period a year earlier.

Key Metrics: Average Daily Users

Reddit is expected to report average daily unique user numbers for the second quarter, which will help investors gauge user engagement and traffic.

Analysts predict the company’s average daily unique users this quarter will reach 85.5 million, up from the previous quarter.

Business Spotlight: Data Licensing for AI Training

Reddit told investors that licensing data for AI training is an additional source of income for the company.

In Q2, Reddit announced a deal with OpenAI in which the creator of ChatGPT will have access to Reddit data in exchange for integrating some OpenAI-powered features into the platform. OpenAI was also announced as an advertising partner. Reddit may provide updates on the deal with OpenAI and other AI-related licensing opportunities.

Reddit shares were down 3.5% in recent Monday trading.