Reddit Q2 Revenue Hits $805M, Marking Eight Consecutive Quarters of 60%+ Growth
Claire Weston
Reddit posted $805 million in Q2 revenue, up 61% year-over-year and beating analyst estimates by roughly $75 million; net income nearly tripled, but Google search-referral volatility is emerging as the key risk to its ad-driven growth engine.
How far above expectations did this quarter land?
Revenue hit $805 million, roughly 10% above the $730 million analyst consensus — marking eight consecutive quarters of 60%+ year-over-year growth.
Net income reached $253 million, up from just $89 million a year ago — nearly a threefold increase.
Free cash flow more than doubled, rising from $111 million to $261 million. This means → Reddit is no longer in a "burn cash for growth" phase; profit and cash generation are scaling in tandem.
Can user growth still hold up?
Global daily active users (DAUq — the number of people opening Reddit each day) reached 130.3 million, up 18% year-over-year and slightly above estimates.
U.S. daily actives grew only 6% to 53.2 million — the bulk of new users came from international markets.
Global average revenue per user (ARPU) stood at $6.18; U.S. ARPU was $11.85. In plain terms = one American user is worth nearly twice as much in ad revenue as an international user, and the fast-growing overseas base is still far from fully monetized.
Why does next quarter's guidance also matter?
Reddit guided Q3 revenue to $860–870 million, above the analyst consensus of roughly $828 million.
Adjusted EBITDA — operating profit before depreciation and amortization, a measure of core earning power — is guided to $385–395 million, also above expectations.
This means → management is not signaling any slowdown for the second half, and the market now has to judge how many more quarters of serial beats are sustainable.
How is the data-licensing business progressing?
The "other revenue" line — primarily data licensing, where Reddit sells user-generated discussion content to AI companies for model training — grew 24% year-over-year to $43 million.
The two largest licensing partners are OpenAI and Google.
This reflects a real-time repricing of Reddit's content assets by the AI industry — but at $43 million against $805 million in total revenue, it is still only about 5% of the business.
Google traffic volatility — what is the biggest overhang?
CEO Steve Huffman acknowledged in his investor letter: "Search referral traffic was volatile this quarter, with traffic becoming more unstable toward the end of the quarter."
Earlier this month, Reddit's stock fell after the Wall Street Journal reported the company was considering cutting off Google's data access.
On the earnings call, Huffman said the company is still seeking a win-win with Google on AI summaries, stating "I don't think there's a simple either-or decision here." In plain terms = Reddit's ad revenue depends heavily on Google search sending users its way, but in the age of AI summaries, Google may surface Reddit content directly on the search page without driving clicks — and that tension remains unresolved.
Content is for reference only, not financial advice.