Reddit (NYSE:RDDT) today disclosed its financial performance for the first quarter ending March 31, 2024, showcasing significant growth in user engagement and revenue alongside a substantial net loss.
The platform's Daily Active Uniques (DAUq) surged by 37% year-over-year, reaching 82.7 million, while Weekly Active Uniques (WAU) rose by 40% to 306.2 million.
These increases are indicative of Reddit's expanding global user base and heightened platform activity.
Financially, Reddit saw a robust 48% increase in revenue, totalling $243 million for the quarter.
Advertising revenue also grew by 39% to $222.7 million.
The company's gross margin improved significantly, reaching 88.6%, which is an increase of 500 basis points from the previous year.
Despite these positive trends, Reddit reported a net loss of $575.1 million, a steep increase from the $60.9 million loss in the same period last year.
This loss was primarily due to a substantial $595.5 million in stock-based compensation expenses and related taxes, largely driven by costs associated with its initial public offering.
On the operational front, Reddit's adjusted EBITDA turned positive at $10 million, a marked improvement from a $50.2 million loss in the prior year.
Operating cash flow also saw a significant boost, coming in at $32.1 million, up $28 million year-over-year.
Meanwhile, free cash flow was reported at $29.2 million after accounting for $2.9 million in capital expenditures.