What You Need To Know Ahead of Reddit’s Earnings Report

Reddit (RDDT) is set to report second-quarter earnings after the bell on Aug. 6, with investors likely watching for user engagement growth and updates on licensing agreements for artificial intelligence (AI) training.

The company is projected to report revenue of $253.8 million, according to analyst estimates compiled by Visible Alpha, which would represent about 39% growth from the year-ago period’s revenue reported in Securities and Exchange Commission (SEC) filings prior to Reddit’s March initial public offering (IPO).

Reddit’s net loss for the second quarter ended June 30 is expected to come in at $52.82 million, or 32 cents per share, widening from a $41.1 million loss reported in pre-IPO filings for the year-ago period.

Key Metrics: Average Daily User Count

Reddit is expected to provide its averages for daily unique user counts for the second quarter, helping investors gauge user engagement and traffic.

Analysts expect the company to report 85.5 million daily unique users on average for the quarter, which would represent growth from the previous quarter.

Business Spotlight: Licensing Data for AI Training

Reddit has told investors that licensing its data for AI training represents an additional revenue source for the company.

During the second quarter, Reddit announced a deal with OpenAI for the ChatGPT maker to access Reddit’s data in exchange for the integration of some OpenAI-powered features into the platform. OpenAI was also announced as an advertising partner. Reddit could provide updates about the agreement with OpenAI and other opportunities related to AI-related licensing.

Reddit shares were down 3.5% in recent trading Monday.