Reddit, in its IPO filing, acknowledges wallstreetbets as a risk factor. The company aims for a $1.4 trillion advertising market by 2027, up from $1 trillion in 2023. Despite $800 million in sales last year, Reddit recorded a $91 million loss. Sam Altman, a major shareholder, holds valuable data for training LLMs. The Condé Nast billionaires stand to gain a $1.4 billion windfall from Reddit's listing. Bernstein questions Reddit's profitability despite high gross margins.
"Is Reddit just another sub-scale social player? If 18-year-olds can fight in wars, surely it’s enough time to prove whether a business can be profitable." - Bernstein, pulling no punches, in a note this morning Notes gross margins (86%) but adj. Ebitda/FCF in neg. territory
The American billionaires behind the Condé Nast media empire will reap a $1.4bn (£1.1bn) windfall from Reddit’s Wall Street listing, 18 years after paying just $10m for the social media company Find out more 👇 https://t.co/OMrk24ucrX
Reddit has a massive amount of data that would be useful in training LLMs. Sam Altman is a major shareholder and former board member. If there’s a Reddit bull case, it’s in this corner. https://t.co/y1fhzSXsAH
Reddit has built a significant advertising business, which was the main contributor to its $800mn in sales last year, but has never made an annual profit. The company recorded a $91mn loss in 2023. There is also concern that the deal could get 'memed' https://t.co/drUYlBmwS9 https://t.co/lQ8hPQwbsE
In Reddit's roadshow video, the company estimates its total addressable market for advertising will be $1.4 trillion by 2027, up from $1 trillion in 2023.
Reddit, in their IPO, lists wallstreetbets as a risk factor in their registration statement https://t.co/Fr0bph0MpH