Key Takeaways
- Shares of Reddit have plummeted 36% so far in 2026, positioning Thursday’s Q1 earnings as a crucial test for investor sentiment.
- Wall Street consensus calls for Q1 revenue of $608 million with adjusted earnings per share of $0.57.
- Advertising income is projected to surge 58% compared to the prior year, reaching $567 million.
- Growth in daily active users is anticipated to moderate to 16%, down from 30.7% in the year-ago quarter.
- Analyst consensus price target of $223.34 represents significant upside from the current trading level near $148.40.
Reddit enters its Thursday earnings announcement facing meaningful headwinds. Shares have declined 36% during 2026, though the stock remains approximately 326% higher than its March 2024 initial public offering price of $34.
The financial results will be released following market close on Thursday. Analysts surveyed by FactSet anticipate adjusted earnings of $0.57 per share alongside revenue of $608 million.
The social platform exceeded projections in its previous quarterly report, delivering revenue of $725.6 million — representing 69.7% year-over-year expansion — accompanied by EBITDA figures that surpassed expectations. This performance establishes elevated expectations for the current period.
For the first quarter, Wall Street projects revenue growth approximating 55% on a year-over-year basis. This represents a deceleration from the 61.5% expansion Reddit achieved in Q1 of the previous year.
Daily active user metrics are drawing particular scrutiny. Reddit disclosed 52.5 million DAUs in its last report, marking 9.4% year-over-year growth. For the upcoming quarter, analysts forecast global DAU expansion of 16% — notably slower than the 30.7% increase recorded in the comparable quarter last year.
This deceleration has generated concern among certain investors, especially as artificial intelligence-driven platforms such as ChatGPT, Google AI Overviews, and similar services provide users with alternative methods to obtain information without directly accessing the platform.
Advertising Performance Under Scrutiny
Regarding advertising metrics, projections appear more favorable. Analysts predict Q1 advertising revenue of $567 million, representing a 58% increase versus the corresponding period last year.
Jefferies analyst John Colantuoni, maintaining a Buy rating with a $250 price target, observed in mid-April that discussions with advertisers indicated “resilient digital budgets” and “particularly strong trends” specific to Reddit.
The platform is also marketing itself as offering something artificial intelligence cannot easily duplicate — a community centered on authentic human perspectives and conversation. This represents the optimistic investment thesis.
D.A. Davidson analyst Wyatt Swanson articulated this position on April 21, stating that Reddit “remains incredibly under-monetized relative to peers” and has established itself as a “human-first social platform.” His rating is Buy with a $200 price target.
Industry Comparison Provides Context
Examining other consumer internet companies that have already announced results offers perspective. Booking reported 16.2% revenue growth for Q1, meeting analyst estimates. Coursera delivered 9.1% growth but saw shares decline 11.6% following its report.
Reddit has consistently outperformed Wall Street projections, and analysts have largely maintained their forecasts over the past 30 days — suggesting expectations for a relatively straightforward quarter.
During the past month, consumer internet stocks have advanced an average of 16.2%. Reddit has climbed 19.5% during this timeframe, indicating the market may have already incorporated some positive sentiment ahead of the announcement.
The consensus analyst price target of $223.34 suggests approximately 50% upside potential from the current price level around $148.40.
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