Reddit (RDDT) shares fell 5% on Monday as worries about slowing growth weighed on the stock ahead of its third-quarter report, due after the close on Oct. 29. Reddit beat the top of its revenue guidance by $58 million to $80 million in each of the last three quarters, but the article argues the fourth-quarter outlook will determine whether the valuation holds. Third-quarter revenue guidance is $860 million to $870 million, up 47% to 49%, below the 61% growth in the second quarter, and consensus implies fourth-quarter revenue of roughly $1.05 billion to $1.06 billion to reach $3.39 billion for 2026. At 16x forward earnings, Reddit trades at the bottom of its one-year range against an average of 26x, and analysts have raised their 2027 earnings estimate 25% since the end of 2025. The author flags U.S. daily users above the second quarter's 53.2 million as the key risk, since a strong guide may not save the multiple if that figure slips.
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Reddit (RDDT) is scheduled to release its third-quarter 2026 results on Oct. 29, 2026. Management expects revenue of $860 million to $870 million, a midpoint implying about 48% year-over-year growth, while the Zacks Consensus Estimate is $886.35 million (up 51.54%) and EPS of $1.30 (up 62.50%). Drivers cited include strong advertising demand, active advertisers up more than 70%, growth in the AI ad automation platform Reddit Max, and international revenue up 84% in the second quarter. Risks include volatility in search referral traffic amid AI-powered search summaries, along with higher spending on AI, product development and marketing. RDDT shares are down 39.8% year to date, versus a 14% gain for the Zacks Computer & Technology sector, and trade at a forward 12-month Price/Sales of 6.18X, above the Internet - Software industry's 4.12X.
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