Reddit, Inc. (NYSE: RDDT) extended its powerful run on 5 December 2025, with shares climbing again as investors digested fresh AI news, product changes, and a stream of upbeat analyst commentary.
As of Friday’s close, Reddit stock traded around $234.11, up roughly 5% on the day, giving the company a market capitalization of about $43 billion and a lofty price-to-earnings (P/E) ratio near 123. Over the last six months, the stock has surged about 97%, dramatically outperforming the broader tech sector. [1]
At the same time, new filings show large institutional investors trimming positions and insiders locking in gains, even as Wall Street’s average 12‑month target now sits slightly below the current price. [2]
Here’s a full breakdown of the latest Reddit stock news, forecasts, and analysis as of 5 December 2025.
Reddit stock today: price, performance and volatility
- Last close (Dec 5, 2025): $234.11
- Daily move: +$11.58 (≈ +5.2%)
- Intraday range: $222.60 – $237.55
- Market cap: ~$43.0 billion
- Trailing EPS: $6.14
- Trailing P/E: ~123x
- 52‑week range: ~$79.75 – $282.95 [3]
- YTD total return: ~43% [4]
- 6‑month gain: ~96.7% [5]
A recent TradingView/StockStory note highlights just how wild the ride has been: Reddit has logged 64 single‑day moves greater than 5% in the past year, marking it as “extremely volatile” even by tech standards. [6]
Fresh headlines on 5 December 2025
1. Stock pops again as AI story stays in focus
A StockStory piece on TradingView reports that Reddit shares jumped about 3% in the morning session as investors continued to focus on the platform’s strong user growth and its increasingly valuable position as a supplier of human‑generated data to train AI models. [7]
The article notes:
- Reddit has become a key source of training data for AI companies, thanks to licensing deals with Alphabet’s Google and OpenAI. [8]
- The rally builds on a powerful six‑month run, yet shares still trade below their 52‑week high near $270. [9]
- An investor who put $1,000 into Reddit at its March 2024 IPO would now be sitting on roughly $4,600, underscoring the magnitude of the move. [10]
The takeaway: AI + user growth is the market’s core narrative, and every incremental datapoint reinforcing that story has been a catalyst.
2. Product shake‑up: CEO says r/popular “sucks”
On the product side, Business Insider reports that CEO Steve Huffman is removing r/popular as the default feed for new users, calling it misleading and bluntly saying it “sucks.” [11]
Key details:
- r/popular will no longer be the default view for newcomers; instead, Reddit will push more personalized feeds built around individual interests. [12]
- Huffman argues that r/popular reflects what the most active users like, not the broader community, giving a false sense of a “single Reddit culture.” [13]
- Reddit now counts around 116 million daily visitors, and Huffman notes the stock is up roughly 44% over the past year. [14]
- The company is also:
- Limiting how many high‑traffic communities one person can moderate
- Changing how community size is displayed
- Continuing its push away from large public chats toward smaller, private group conversations [15]
For investors, this matters because personalization and smaller, stickier communities tend to support engagement — and therefore ad pricing and retention — which are already central to Reddit’s financial story.
3. Big holders cash in: HSBC and 1832 Asset Management trim
Two new institutional holding updates hit MarketBeat on 5 December:
- HSBC Holdings PLC
- Sold 118,552 shares in Q2, cutting its Reddit position by 75%
- Now holds 39,595 shares worth about $6.0 million [16]
- 1832 Asset Management L.P.
- Sold 87,400 shares, reducing its stake by 46.6%
- Still owns 100,087 shares, or about 0.05% of Reddit, valued near $15 million [17]
At the same time, the MarketBeat coverage highlights that some large institutions have been adding:
- Vanguard boosted its holdings by 6.3% to over 10.8 million shares.
- AllianceBernstein, T. Rowe Price Investment Management, JPMorgan and Geode Capital also increased their positions in recent quarters. [18]
Insiders are selling, but still heavily invested:
- CTO Christopher Slowe sold 24,000 shares around $192.72.
- CEO Steve Huffman sold 18,000 shares around $215.19.
- The CAO and other executives have also sold stock in recent weeks. [19]
In total, insiders sold about 394,000 shares worth $83 million over the last 90 days, yet insiders still own around 34% of the company, a high level of alignment compared with many public tech peers. [20]
Inside the numbers: Q3 2025 earnings and guidance
Reddit’s latest earnings report (Q3 2025) is the backbone of the current bull case.
According to the company’s official release for the quarter ended 30 September 2025: [21]
- Revenue: $585 million (+68% YoY)
- Ad revenue: $549 million (+74% YoY)
- Other revenue (including data licensing): $36 million (+7% YoY)
- Daily Active Uniques (DAUq): 116.0 million (+19% YoY)
- Weekly Active Uniques (WAUq): 443.8 million (+21% YoY)
- Global ARPU: $5.04 (+41% YoY)
- U.S. ARPU: $9.04 (+54% YoY)
- International ARPU: $1.84 (+39% YoY) [22]
- GAAP gross margin: 91.0%
- Net income: $163 million (net margin ~27.8%)
- Diluted EPS: $0.80, up from $0.16 a year ago
- Adjusted EBITDA: $236 million (margin ~40%)
- Operating cash flow: $185 million
- Cash, cash equivalents and marketable securities: ~$2.23 billion
Management outlook
For Q4 2025, Reddit guided to: [23]
- Revenue: $655–$665 million
- Adjusted EBITDA: $275–$285 million
Zacks’ coverage notes that:
- The Zacks Consensus Estimate pegs Q4 revenue around $668.5 million (~56% YoY growth).
- Q4 EPS is estimated at $0.97, implying ~169% year‑over‑year growth.
- For full‑year 2025, consensus is around $2.12 billion in revenue (+63% YoY) and EPS of $2.35 (+171% YoY). [24]
In short: Reddit has shifted from “maybe profitable someday” to generating real earnings and cash flow at high double‑digit growth rates, which helps explain the aggressive multiple.
Reddit and AI: from social network to data infrastructure play
A big part of Reddit’s recent re‑rating comes from its strategy in the AI data licensing market.
High‑value data deals with Google and OpenAI
A deep‑dive from Columbia Journalism Review (CJR) outlines how Reddit signed a $60 million per year content‑licensing deal with Google in February 2024, followed by a similar agreement with OpenAI, estimated around $70 million annually. [25]
The piece highlights several key points:
- Between August 2024 and June 2025, analytics firm Profound found Reddit was the most‑cited domain in Google AI Overviews and Perplexity, and second most‑cited in ChatGPT answers. [26]
- A Google search algorithm update boosting forums like Reddit and Quora nearly tripled Reddit’s readership between August 2023 and April 2024. [27]
- News publishers have responded by ramping up their presence on Reddit as a traffic source, despite the need to carefully navigate subreddit norms. [28]
An AI‑generated note on AInvest adds more financial color:
- In Q2 2025, Reddit generated about $35 million from AI data licensing, contributing to $500 million in total revenue (+78% YoY). [29]
- Management is reportedly negotiating dynamic pricing with Google and OpenAI, seeking deals where Reddit gets paid more as its content becomes more critical to AI answers. [30]
CJR also points out that Reddit has tightened access to its data:
- Blocking most automated crawlers
- Suing Anthropic for allegedly scraping the site after promising to stop
- Restricting the Internet Archive’s Wayback Machine from crawling much of Reddit [31]
For investors, the implication is clear: Reddit is trying to position itself as must‑have infrastructure for AI models, not just another ad‑supported social platform.
Advertising engine, ARPU and international growth
Reddit’s AI strategy is tightly linked to its advertising business, which remains its primary revenue driver.
From Reddit’s Q2 2025 coverage in TechCrunch: [32]
- Q2 total revenue was about $500 million, with ad revenue of $465 million, accounting for ~93% of the total.
- “Other revenue” (primarily data licensing) was $35 million, up 24% YoY.
- New ad tools include:
- Reddit Insights, which mines billions of posts/comments for real‑time trends and campaign ideas
- Conversation Summary add‑ons, which let advertisers embed community discussion snippets directly into ads
- The Reddit Answers tool, a conversational search feature, went from 1 million to 6 million weekly users within a quarter and is being integrated deeper into core search. [33]
The more recent Zacks/Nasdaq article on Reddit’s six‑month 97% surge underlines why advertisers are showing up: [34]
- Q3 2025:
- 116 million DAUs and 444 million WAUs, both up about 20% YoY
- Over 75 million people use Reddit search weekly
- Advertising revenue jumped 74% YoY to $549 million, driven by:
- a 75%+ increase in active advertisers across large brands, mid‑market and SMBs
- tools like Reddit Pixel, Conversion API (CAPI) and Dynamic Product Ads
International growth is particularly important:
- Q3 international ARPU reached $1.84, up 39% YoY as Reddit rolls out machine translation in 30 languages and tailors content frameworks for markets like India, Brazil, Germany and France. [35]
Put simply, Reddit is turning engagement into money more efficiently quarter after quarter, especially outside the U.S.
What Wall Street is saying: analyst ratings and price targets
Consensus ratings
Across several major aggregators, the message is consistent: Reddit is generally a buy, but not a cheap one.
- MarketBeat
- Consensus rating: Moderate Buy
- 28 analysts: 3 Strong Buy, 14 Buy, 9 Hold, 2 Sell [36]
- StockAnalysis.com
- Consensus rating: Buy
- 25 covering analysts [37]
Zacks currently assigns Reddit a Rank #1 (Strong Buy) with a Growth Score of A, citing booming ad revenue, rapid ARPU expansion and strong user metrics. [38]
12‑month price targets
There is a striking divergence between Reddit’s explosive fundamentals and where analysts think the stock should trade over the next year:
- MarketBeat
- Average target:$226.33
- High: $300
- Low: $75
- Implied 3–4% downside vs. a price around $234–235 at the time of the survey. [39]
- StockAnalysis
- Average target:$219.04
- High: $300
- Low: $75
- Implied ~6.4% downside relative to Friday’s close. [40]
- Benzinga (analyst compilation)
- Shows a consensus target around $215–216, also with a $300 high and $75 low, and notes that more recent targets from Citi, JP Morgan and B. Riley cluster higher, around $245–265. [41]
In other words, Wall Street broadly likes Reddit but thinks much of the near‑term upside is already priced in, unless growth or AI economics beat current expectations.
Valuation check: how expensive is Reddit stock?
This is where opinions really diverge.
Classic metrics say “expensive”
- Reddit trades at a trailing P/E around 120–125x, versus an industry average near 16x and a peer average around 39x, according to Simply Wall St. [42]
- Zacks points out that the forward 12‑month price‑to‑sales ratio is about 14.4x, more than double the broader computer & technology sector average of 6.7x, and assigns the stock a Value Score of F – flagging it as expensive on traditional value metrics. [43]
Narrative models say “maybe modestly undervalued”
Simply Wall St’s narrative‑driven valuation model argues that Reddit might still be around 7.5% undervalued, with a “fair value” estimate near $240.70 versus a recent price around $222.76 at the time of their analysis. [44]
Their article emphasizes:
- The growing recognition of Reddit’s data value for AI/LLM training,
- Rapid margin expansion,
- Yet also warns that a P/E over 120x leaves substantial downside risk if sentiment cools. [45]
The tension is straightforward:
Bulls think Reddit is an early‑stage, high‑margin AI + advertising platform that justifies a premium multiple.
Bears worry that even great execution may not live up to the growth that’s already priced in.
Long‑term forecasts: 2025–2030 and beyond
Beyond the 12‑month target, investors are watching both Wall Street models and algorithmic forecasts.
Street revenue and EPS forecasts
StockAnalysis aggregates analyst forecasts suggesting: [46]
- 2025 revenue: ~$2.19 billion, up 68% from 2024’s ~$1.30 billion
- 2026 revenue: ~$3.03 billion, another 38% growth
- 2025 EPS: about $2.32, a sharp swing from a loss of $3.33 in 2024
- 2026 EPS: about $3.79, an additional 63% EPS growth
Those numbers broadly line up with Zacks’ full‑year 2025 view ( ~$2.12B revenue, $2.35 EPS ), reinforcing the narrative that Reddit is scaling into profitability faster than many expected at IPO. [47]
Algorithmic price targets (CoinCodex via Benzinga)
Benzinga also cites algorithmic projections from CoinCodex that paint a wide range of possible futures: [48]
- 2025 average prediction: ~$191 (bullish scenario ~$223, bearish ~$183)
- 2026 average prediction: ~$202 (bullish ~$235, bearish ~$170)
- 2030 average prediction: around mid‑$400s, with bullish scenarios north of $500
These models rely on historical price patterns and volatility, not fundamentals, so they’re best treated as scenario ranges, not precise forecasts.
Key risks investors are watching
Recent analysis pieces from Zacks, Benzinga, CJR and AInvest flag several recurring risk themes: [49]
- Valuation and volatility
- A triple‑digit P/E and mid‑teens P/S mean any slowdown in growth, AI licensing, or ad demand could trigger sharp pullbacks.
- The stock’s history of frequent 5%+ daily moves underscores this risk.
- Ad market cyclicality
- Reddit still earns the vast majority of its revenue from advertising, which is sensitive to economic cycles and marketing budgets.
- Regulatory and legal scrutiny
- Data licensing for AI puts Reddit under the microscope of regulators and privacy advocates.
- CJR notes Reddit is already in legal conflict with Anthropic over alleged unauthorized scraping. [50]
- Content moderation and brand safety
- As advertisers pile in, any high‑profile controversy around content, misinformation or toxicity could put pressure on ad spend and partnerships.
- Competition
- Reddit competes with larger players like Meta, X, TikTok, YouTube, Quora and others for attention, creators and ad dollars.
- If rivals replicate Reddit‑like communities and data, its perceived AI advantage could erode.
The bottom line: where Reddit stock stands after 5 December 2025
Putting it together:
- Fundamentals are on fire.
Revenue is growing at 60–70%, margins are expanding, and the company is comfortably profitable on both EPS and cash flow. [51] - The AI data story is real, not just hype.
Multi‑year licensing deals with Google and OpenAI, measurable AI‑search visibility and a meaningful data‑licensing revenue stream give Reddit a second growth engine beside ads. [52] - User and advertising metrics are breaking records.
DAUs, WAUs, ARPU and active advertiser counts are all rising at double‑digit rates, with especially strong international momentum. [53] - But the bar is extremely high.
With P/E around 120x and price‑to‑sales more than double the sector average, Reddit has little room for disappointment. [54] - Analysts like the business more than the near‑term upside.
Most rate Reddit a Buy/Moderate Buy, but consensus 12‑month targets generally sit slightly below the current share price, reflecting a view that the stock has largely “caught up” to the story for now. [55]
For investors following Reddit stock (RDDT), 5 December 2025 marks a moment where the narrative is stronger than ever, but expectations are just as strong. Whether Reddit still fits your portfolio depends on your tolerance for high growth, high multiple, high volatility names — and your conviction that the company can keep turning its unique communities into both AI infrastructure and a global advertising powerhouse.
This article is for informational purposes only and does not constitute financial or investment advice. Always do your own research or consult a qualified advisor before making investment decisions.
References
1. www.nasdaq.com, 2. www.marketbeat.com, 3. www.marketbeat.com, 4. finance.yahoo.com, 5. www.nasdaq.com, 6. www.tradingview.com, 7. www.tradingview.com, 8. www.tradingview.com, 9. www.tradingview.com, 10. www.tradingview.com, 11. www.businessinsider.com, 12. www.businessinsider.com, 13. www.businessinsider.com, 14. www.businessinsider.com, 15. www.businessinsider.com, 16. www.marketbeat.com, 17. www.marketbeat.com, 18. www.marketbeat.com, 19. www.marketbeat.com, 20. www.marketbeat.com, 21. investor.redditinc.com, 22. investor.redditinc.com, 23. investor.redditinc.com, 24. www.nasdaq.com, 25. www.cjr.org, 26. www.cjr.org, 27. www.cjr.org, 28. www.cjr.org, 29. www.ainvest.com, 30. www.ainvest.com, 31. www.cjr.org, 32. techcrunch.com, 33. techcrunch.com, 34. www.nasdaq.com, 35. www.nasdaq.com, 36. www.marketbeat.com, 37. stockanalysis.com, 38. www.nasdaq.com, 39. www.marketbeat.com, 40. stockanalysis.com, 41. www.benzinga.com, 42. simplywall.st, 43. www.nasdaq.com, 44. simplywall.st, 45. simplywall.st, 46. stockanalysis.com, 47. www.nasdaq.com, 48. www.benzinga.com, 49. www.nasdaq.com, 50. www.cjr.org, 51. investor.redditinc.com, 52. www.cjr.org, 53. investor.redditinc.com, 54. simplywall.st, 55. www.marketbeat.com
