Reddit’s Getting More Popular
upstart writes:
Reddit's getting more popular:
In May 2023, Reddit announced that its API would no longer be free, signaling the demise of most third-party Reddit apps and the start of a new Reddit era. Reddit was always interested in making money, but the social media platform's drive to reach profitability intensified with its API rule changes, which was followed by it going public and other big moves. With Reddit reporting this week that it has finally turned its first profit, we can expect further evolution from Reddit, whether old-time Redditors like it or not.
In its fiscal Q4 2024 results announced on Tuesday [PDF], Reddit said that in the quarter ending on September 30, it made a profit of $29.9 million. This is significant growth from fiscal Q3 2024, when Reddit lost $7.4 million. Revenue, meanwhile, was up 68 percent year over year, going from $207.5 million to $384.4 million. Reddit is expecting $385 to $400 million in revenue for fiscal Q4.
[...] Of course, more users give ads sold on Reddit the chance to gain more eyeballs, something that can help drive ad sales. Reddit's ad revenue has grown alongside its daily user base. In Q3 2024, Reddit made $315.1 million in ad revenue, a 56 percent year-over-yearincrease.
Reddit has historically made the majority of its revenue from ad sales. Huffman has long claimed that Reddit started charging for its API in order to prevent big companies, like Google, from using Reddit content for free AI training. However, the high pricing killing third-party apps also fed Reddit's goals of getting users onto its native website and apps-where Reddit sells ads.
Reddit is expected to continue its aggressive ads push, including by exploring new ways to incorporate ads into the user experience. For example, Reddit has previously discussed exploring the addition of ads in Reddit search and in comments. It also added ads to conversation pages and made personalized ads mandatory this year.
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