Reddit’s on a roll. The social media platform has just turned a profit for the first time in its 20-year history, and now boasts a record 97.2 million daily active users, marking a year-over-year increase of 47%. A few times during the quarter, the figure topped 100 million, which Reddit CEO and co-founder Steve Huffman said in a letter to shareholders had been a “longstanding milestone” for the site.
The company, which went public in March, announced the news in its third-quarter earnings results on Tuesday.
In a remarkable turnaround, Reddit reported a $29.9 million profit, a huge improvement on the $575 million loss that it suffered earlier this year in its first quarter as a public company, though in its last quarter it reduced that to $10 million.
The strong performance is down to ad revenue of $315.1 million, up by 56% on a year earlier, and “other revenue” (including deals struck with Google and AI to allow Reddit content to be used for training their AI models), which reached $33.2 million, marking a whopping 547% increase on a year earlier.
“It was another strong quarter for Reddit and our communities as we achieved important milestones, including new levels of user traffic, revenue growth, and profitability,” Huffman said on Tuesday.
The CEO said that so far this year, “Reddit” has been the sixth most Googled word in the U.S. as people increasingly turn to the platform for answers, advice, and communities.
“We saw this play out in real-time when the White House came to Reddit to share critical information during recent hurricanes, reaching people in the affected areas with timely updates,” he said.
But it hasn’t all been smooth sailing for the company behind the popular online forum. Last year, for example, Reddit was heavily criticized for its decision to start charging for API access, a move that heavily impacted third-party apps and which caused some to close down.
It’s also facing scrutiny from the Federal Trade Commission over the sale of user-generated content for training large language models operated by Google and OpenAI.