Reddit, Inc. Q4 FY2025 earnings call

• User growth: Q4 saw over 121 million daily active users (up 19% y/y) and over 471 million weekly active users (up 24% y/y).
• Product initiatives: Focus on improving onboarding (deployed experiments to improve new user retention), search (unified core search with Reddit Answers, 80M+ weekly searches in Q4), and bot verification/labeling (launching verified profiles for brands/individuals in Q4).
• Ad stack investments: ML and signals optimization driving ad performance, launch of Reddit Max campaign (AI-powered platform), expansion of unique ad products (interactive ads, reminder ads, verified profiles) to enhance advertiser value across the funnel.

In Q4 2025, Reddit, Inc. generated $726 million in revenue, up 70% year over year. The advertising business grew 75% year over year to $690 million in Q4. For the full year, revenue reached $2.2 billion, up 69% year over year. Advertising was the key driver, with performance ads outperforming, revenue from lower funnel objectives doubling, strength across channels (large customer, scaled, SMBs), broad vertical strength (11 out of top 15 verticals grew by 50%+), and geographies (U.S. up 68%, international up 78%). Average revenue per user (ARPU) grew to $5.98, up 42% year over year.

• 2026 revenue guidance: $595 million to $605 million, representing 52%-54% year-over-year growth.
• Adjusted EBITDA guidance: $110 million to $220 million, approximately 82%-91% year-over-year growth with a midpoint adjusted EBITDA margin of 36%.
• Stock-based compensation: Aiming for high teens as a percentage of revenue, targeting dilution at the lower end of the medium-term guide (1%-3%).

• AI-related risks: Distinguishing real user thoughts from AI-generated content and maintaining authenticity/conversation quality. Potential erosion of trust if not managed properly.
• Market competition: Evolving landscape with other platforms and AI-driven tools, which could impact user engagement and advertiser adoption.
• Bot-related risks: Ensuring proper bot verification and labeling to maintain community authenticity, as unregulated bots could erode trust.

Q: Can you talk about the monetization opportunity with logged-out users?

A: Jennifer Wong said logged-in and logged-out users see ads with same impression value. The focus is on increasing engagement. Removing the log-in/log-out reporting distinction is to blur the line, focusing on improving engagement to drive more value through increased impressions with engagement.

Q: How do you see AI-generated content evolving on the platform and its impact?

A: Steven Huffman said AI-generated content has a role, but transparency and intentionality are key. Need to label AI-generated content to maintain authenticity. Reddit is for humans talking to humans, so AI content must be well-labeled. On agentic commerce, Reddit is well-positioned as the point of trusted recommendations, important for marketers' decision-making.