New York, Jan 15, 2026, 17:45 EST — After-hours
- Reddit shares dropped roughly 9% late Thursday, as renewed scrutiny on advertising demand weighed on the stock
- RBC reports “mixed” reactions from small-business ad agency surveys, highlighting weak conversion as a key issue
- Reddit scheduled Q4 earnings for Feb. 5; filing reveals CFO sold shares via a pre-arranged plan
Shares of Reddit dropped 9.4% to $228.75 in after-hours trading Thursday, deepening a steep sell-off as investors digested a cautious outlook on advertising demand in the near term.
On Thursday, the company announced it will report fourth-quarter and full-year 2025 results after the market closes on Feb. 5, followed by a conference call at 4:30 p.m. ET. This sets the stage for renewed focus on “ad momentum” in the coming weeks for a stock known for its volatile swings. 1
RBC Capital Markets analyst Brad Erickson said ad checks with small- and mid-sized business agencies showed a “mixed” picture. He noted a stronger setup for big digital ad players like Meta and Google, but a gloomier outlook for Reddit. Erickson highlighted low-cost CPMs — cost per thousand ad impressions — that often failed to deliver solid conversions. He also cautioned that expectations for the upcoming results are running high. 2
Investors had fresh competition to consider. Digg, the social news site that once held sway before Reddit took over, rolled out an open beta Wednesday. The relaunch comes under the leadership of Kevin Rose, its founder, and Reddit co-founder Alexis Ohanian. They’re banking on new trust tools and AI-driven moderation to carve out a niche. “We obviously don’t want to force everyone down some kind of crazy KYC process,” Rose told TechCrunch. 3
Reddit CFO Andrew Vollero offloaded 3,974 Class A shares on Jan. 9 and Jan. 13, raking in roughly $1.04 million, according to a regulatory filing this week. After these moves, he still holds 251,644 shares. The sales were executed under a Rule 10b5-1 plan set up back on Sept. 11, 2025—a pre-planned trading strategy allowing insiders to schedule stock sales ahead of time. 4
Not all recent reports have taken a cautious tone. Earlier this week, Evercore ISI kicked off coverage with an “outperform” rating and set a $320 price target. The firm sees potential upside in revenue per user and flagged AI-powered advertising tools and data licensing as key growth drivers. 5
Reddit has banked on its scale and user engagement to drive ad sales. The company reports having over 100,000 active communities and recorded 108.1 million daily active users in the third quarter ending Sept. 30, 2025, with most of its revenue coming from advertising. 6
Investors warn the advertising picture could worsen before it clears up. Should conversion rates fail to rise for smaller brands, or if spending shifts back toward major platforms, Reddit may find it tough to meet the high expectations built into its upcoming earnings.
February 5 is the next major checkpoint: earnings, guidance, and management’s take on ad pricing, campaign results, and the pace at which new automation tools are turning into revenue.
