Reddit Q3 2026 earnings are out, and the numbers look strong on paper. The company made $895 million in revenue, up 53% from last year. But investors still sold the stock hard, because Reddit warned that its traffic from search engines is falling fast.
Reddit Q3 2026 Earnings: The Key Numbers
Reddit shared its third quarter results on October 29, 2026, after the stock market closed. The company said its revenue reached $895 million, which is 53% higher than the same quarter last year. Wall Street had expected about $875 million to $878 million, so Reddit beat the forecast.
Reddit also made a real profit. Net income hit $283 million, which is 32% of its revenue. Diluted earnings per share came in at $1.40, up 75% from a year ago. This marks the ninth quarter in a row that Reddit has stayed profitable under GAAP rules. You can read the full details in the company’s official earnings release.
| Metric | Q3 2026 Result |
|---|---|
| Total revenue | $895 million (+53% YoY) |
| Ad revenue | $847 million (+54% YoY) |
| Other revenue | $48 million (+35% YoY) |
| International revenue | +67% YoY |
| Weekly Active Uniques | 515.2 million (+16% YoY) |
| Daily Active Uniques | 130.3 million (+12% YoY) |
| Net income | $283 million |
| Adjusted EBITDA | $402 million (45% margin) |
| Free cash flow | $363 million |
| Cash and securities | $3.0 billion |
Users and Ads Keep Growing
More people now use Reddit every week and every day. Weekly Active Uniques rose 16% to 515.2 million. Daily Active Uniques rose 12% to 130.3 million. Reddit also said its most valuable users, the ones who log in and use the app, grew compared with the last quarter.
Advertising still drives the business. Ad revenue grew 54% to $847 million, as advertisers paid higher prices and bought more ads. Revenue outside the United States grew even faster, at 67%. The company also kept its costs low. Its gross margin stayed at 91.5%, and its spending on equipment was only about $1 million.
Reddit also spent $100 million to buy back about 670,000 of its own shares, at an average price of $149.81 per share. Those shares now trade far below that price.
Why the Reddit Stock Fell After Earnings
Good results did not save the stock. Reddit closed Thursday at about $129.60. After the report, the price dropped to around $108 in after-hours trading, a fall of roughly 17%. On Friday morning, shares slid even lower before the market opened, near $100.
Two things scared investors. First, Reddit gave a weaker sales forecast for the fourth quarter. The company expects revenue of $1.00 billion to $1.03 billion, while analysts hoped for about $1.05 billion. It also expects adjusted EBITDA between $480 million and $510 million.
Second, CEO Steve Huffman warned about search traffic. He said visits that come from search engines fell by more than one million per week on average during October. If that pace continues, daily active users could drop by a low double-digit percentage in the fourth quarter. Huffman blamed the change on AI answers in search results, which now keep more people on the search page.
What Reddit plans to do: The company will test a “logged-in only” experience in some international markets during the fourth quarter. This means people may need an account to browse. Reddit hopes this will build a loyal user base that does not depend on search engines.
Reddit Valuation: How Much Is the Company Worth?
Reddit’s value moved a lot in a single day. Reddit has about 206.3 million fully diluted shares. At Thursday’s closing price of $129.60, that gives a market value of about $26.7 billion. At the after-hours price near $108, the value drops to about $22 billion. If the stock stays near $100, Reddit would be worth roughly $20.6 billion.
These figures are our own estimates, based on the share count in Reddit’s shareholder letter and recent share prices. Stock prices change every second. This article is news, not investment advice.
For comparison, Reddit went public in March 2024 at $34 per share, which valued the company at around $6.4 billion. The stock has climbed a long way since then, but it has fallen sharply this year. Reddit also joined the S&P 500 index recently, which put more attention on every move.
Who Founded Reddit?
Steve Huffman and Alexis Ohanian started Reddit in June 2005. The two friends met at the University of Virginia. They built Reddit during the very first batch of Y Combinator, the famous startup program, and the site quickly became a home for community-driven discussion.
Condé Nast bought Reddit in 2006, only about a year after launch. Huffman later left, then came back in 2015 as CEO and has run the company ever since. He led Reddit through its stock market debut in 2024. Ohanian went on to build his own investment businesses and became one of the best-known startup investors in tech.
What Happens Next for Reddit?
Reddit is growing fast and making real money, and few social media companies can say that. Still, the next few months matter a lot. If search traffic keeps falling, Reddit must turn casual visitors into logged-in members. Investors will watch the fourth quarter report closely to see if that plan works.
