Reddit Adds 8.5M Users in Q2, Improves Revenue Performance

Reddit has posted its second performance report as a listed company, which shows the company steadily gaining users and revenue in Q2.

Growth is spread across various markets. Reddit is also investing in new technology to deliver better return on advertiser spend.

First off, on users. Reddit added 8.5 million more daily active users in the period, taking it up to 91.2 million daily users.

Which is a solid increase, but as noted, the most impressive element may be that Reddit is seeing equal levels of growth both inside and outside the U.S.

Some social apps have seen significant growth in developing regions, but limited expansion in the U.S. and Europe of late, which are the most lucrative markets for social ad spend. As such, increases in developing regions don’t deliver the same impact, at least initially. Reddit extending its reach in both is a positive sign for its growth potential.

Reddit also reports that its weekly average users were at 342.3 million in the second quarter, up 57% year-over-year.

Which is actually a bit of an odd stat. Based on this, Reddit sees almost four times as many users per week as it does on a daily basis. That’s significantly higher than the social app average, which is more like 2:1 monthly to daily users.

For some reason, Reddit doesn’t seem to have the same stickiness in this respect, with a more transitory audience, who check into subreddits less frequently. That means that Reddit can provide expanded outreach to a wider audience than its daily user stats suggest, but also on a less consistent basis. Which is something that advertisers may need to factor into their planning.

In terms of revenue, Reddit brought in $281.2 million for the quarter, an increase of 54% year-over-year.

Reddit says that this is more than double the growth rate it saw in 2023, with improvements in its ad products and a bigger focus on SMBs helping to boost its ad intake.

Reddit also made a significant acquisition to further boost its ad performance, with Memorable AI set to provide more generative AI options for Reddit ad partners.

Also worth noting, Reddit’s “Other” revenue streams, aside from ads, brought in $28.1 million in Q2, an increase of more than 690% year-over-year.

Reddit’s been working to put a higher value on its unique data, as AI projects look for human inputs to power their LLMs. Reddit’s already increased the price of its API access, while it’s also negotiated data sharing deals with several companies, including Google, to maximize its revenue opportunities.

More recently Reddit blocked other search engines from indexing its content.

As Reddit explains:

“In alignment with our public content policy, we took additional steps in Q2 to better protect and control where and how Reddit’s content is used and accessed by web crawlers and search engines. We continue to strategically explore data licensing agreements with collaborative partners in the ecosystem ranging from marketing intelligence companies to enterprise-scale technology companies. We are also exploring go-to-market strategies for new verticals, including the financial services industry.”

So, essentially, Reddit’s trying to make sure that no one scrapes its data for free, which is already providing expanded revenue potential. And with more users coming on board, that stands to be a significant lure for other AI projects in future.

It’s a pretty good report card for Reddit, which shows that it’s investing its capital into new elements that are helping to both increase usage and revenue opportunities. And while it’s still a lesser consideration for most social media marketers, there is potential there, with Reddit’s highly engaged communities facilitating direct access to interested, passionate user groups.