Reddit Q4 Earnings: Can Good Numbers Halt the Selloff?
Reddit Q4 Earnings: Can Good Numbers Halt the Selloff?
- Reddit Q4 earnings report due out on Thursday, February 5, after the market close.
- The stock is down over 30% since the start of the year as growth and valuation concerns weigh.
- Options traders see an expected move of +/- 21.18 points.
Reddit to report earnings on Thursday, February 5
It’s been nearly two years since Reddit (RDDT), known as the front page of the internet, listed on public markets back in March 2024. The stock is up over 200% since its IPO, which was one of the biggest of the year for the New York Stock Exchange. However, going into its fourth quarter earnings, Reddit is down over 30% since the start of the year.
One of the biggest things weighing on Reddit is a growth slowdown, something that isn’t ideal for a company that is newly publicly traded. Revenue is expected to grow about 56% year-over-year, which is lofty but down from a 71% YoY growth rate from the third quarter.
An Adweek report last month showed that YouTube, an asset owned by Alphabet (GOOGL), overtook Reddit as the primary source of training for AI models. Advertiser growth is also expected to slow this year, according to Ross Walthall, a research analyst at Cleveland Research.
The analyst, whose notes were cited by tipranks.com, stated that increased competition from TikTok, Snap (SNAP), and OpenAI would likely eat into its advertising revenue this year. A slowdown for a company that already has a stretched valuation likely has weighed on sentiment for Reddit.
Investors will want to see increased daily active users (DAUs) reported on Thursday. Last quarter, Reddit said it had 51.6 million DAUs. One tailwind for this metric could come from the company’s efforts to reach international audiences, with its automated translation tools aimed at promoting the site in non-English-speaking regions.
What analysts expect from Reddit
According to TradingView, analysts expect Reddit to report earnings per share (EPS) of $0.94 on $665.93 million in revenue. That would be up from an EPS of $0.36 on $427.7 million in revenue a year ago. Last quarter, Reddit posted an EPS of $0.80 on $585 million in revenue.
Reddit has managed to beat expectations on EPS and revenue in every quarter over the last year. However, beating estimates may not be enough to revive confidence in the stock, as traders will want to see a roadmap on retaining strong revenue growth and good DAUs.
Trading Reddit earnings
Options traders see an expected move of +/- 21.18 points on earnings, or 14% of Wednesday’s 152.50 stock price. That expected move is above the average 5% to 10% expected move for S&P 500 companies.
Technically, Reddit is testing an area of congestion that was found from late 2024 to August 2025 around the 150 to 160 level. A move lower could clear the way for more downside to levels not traded since June 2025. However, the 9-day exponential moving average (EMA) has capped upside since late January.
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