TLDR
- Reddit reports Q2 earnings on July 30 after market close
- Analysts expect 46.3% revenue growth to $731 million and GAAP EPS of $0.97
- Ad revenue jumped 74% in Q1 to $625 million; daily active users hit 126.8 million
- A standoff with Google over a $60 million data licensing deal is the key risk heading into earnings
- Wall Street has a Moderate Buy consensus with an average price target of $226.29, implying 26% upside
Reddit (RDDT) heads into its July 30 earnings report trading at $179.23, down 20% year-to-date after a sharp January selloff, though the stock is still up over 400% since its 2024 IPO.
Q2 results are due after the bell on Thursday. Analysts are calling for revenue of $731 million, representing 46.3% year-over-year growth, and GAAP earnings of $0.97 per share — more than double the $0.45 reported in Q2 2025.
Reddit beat those kinds of expectations in Q1, posting 69% revenue growth to $663.4 million. Net income came in at $204 million, with free cash flow of $311.2 million.
Ad revenue drove the bulk of that performance, rising 74% to $625 million. Ad impressions climbed roughly 32%, while average pricing rose by a similar amount.
Management has guided for Q2 revenue of $715 million to $725 million and adjusted EBITDA of $285 million to $295 million. Any result above that range could move the stock higher.
Daily active users reached 126.8 million in Q1, up 17% year-over-year. International weekly active users grew 33%, compared to 10% domestically.
The gap between U.S. and international monetization remains wide. Average revenue per international user stood at $2.02 versus $9.63 in the U.S., leaving room for improvement as Reddit expands translation tools and local content.
The Google Question
The biggest issue heading into Thursday is Reddit’s ongoing dispute with Google over content licensing. The two companies have been renegotiating a deal worth roughly $60 million per year.
Reddit is reportedly pushing for a usage-based fee structure, frustrated that Google’s AI Overviews direct users to Google’s own summaries rather than back to Reddit’s platform.
Reddit stock dropped 9% in a single session last week after the Wall Street Journal reported the company had considered cutting off Google’s access to its content entirely.
Expect earnings call questions to center on this relationship. A favorable new deal could add meaningful high-margin licensing revenue. A breakdown could hurt both licensing income and organic search traffic.
Ad Business Stays Strong
On the advertising side, Alphabet reported 14% ad revenue growth in Q2, suggesting the broader digital ad market remains healthy. That’s a positive backdrop for Reddit heading into its own report.
Ads accounted for about 94% of Reddit’s Q1 revenue. That concentration is a risk if ad demand weakens, but for now the numbers point in the right direction.
Reddit has also historically set conservative guidance, making it more likely to beat consensus estimates.
Wall Street currently rates RDDT a Moderate Buy, with 13 Buy ratings, 8 Holds, and zero Sells from analysts over the past three months. The average price target sits at $226.29, implying roughly 26% upside from current levels.
Reddit’s Q2 earnings drop after market close on July 30.
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