Reddit reports a 75% surge in ad revenue

For the quarter ended December 31, 2025, Reddit reported revenue of $726 million. Advertising continued to drive growth, with ad revenue surging 75% year on year to $690 million, while other revenue stood at $36 million. Overall, quarterly revenue grew 70% compared to the same period last year.

The company maintained a disciplined cost approach even as revenues scaled. Sales and marketing expenses totalled $163.9 million for the quarter, reflecting measured investment. Gross margin remained robust at 91.9%, only slightly below last year’s level, while net income climbed to $252 million, representing a nearly 255% year-on-year increase. Adjusted EBITDA reached $327 million, supported by operating cash flow of $267 million and free cash flow of $264 million.

For the full year 2025, Reddit posted revenue of $2.2 billion, up 69% year on year, with advertising contributing $2.1 billion. Annual sales and marketing spend amounted to $503.9 million, in line with the company’s focus on efficiently monetising its growing user base. Net income for the year reached $530 million, while free cash flow rose to $684 million.

Looking ahead, Reddit forecast first-quarter 2026 revenue in the range of $595 million to $605 million, ahead of market expectations. The company also announced a $1 billion share buyback programme, signalling confidence in its financial outlook and the continued momentum of its advertising-led business.

Following the results, Reddit shares rose 5% in after-hours trading, as the company’s fourth-quarter performance exceeded expectations on revenue, profitability and forward guidance.