Reddit Files To Go Public

Reddit has filed its initial public offering (IPO) with the SEC on Thursday. 'The company plans to trade on the New York Stock Exchange under the ticker symbol 'RDDT,'' reports CNBC. From the report: Its market debut, expected in March, will be the first major tech initial public offering of the year. It's the first social media IPO since Pinterest went public in 2019. Reddit said it had $804 million in annual sales for 2023, up 20% from the $666.7 million it brought in the previous year, according to the filing. The social networking company's core business is reliant on online advertising sales stemming from its website and mobile app.

The company, founded in 2005 by technology entrepreneurs Alexis Ohanian and Steve Huffman, said it has incurred net losses since its inception. It reported a net loss of $90.8 million for the year ended Dec. 31, 2023, compared with a net loss of $158.6 million the year prior. Reddit said it plans to use artificial intelligence to improve its ad business and that it expects to open new revenue channels by offering tools and incentives to 'drive continued creation, improvements, and commerce.' It's also in the early stages of developing and monetizing a data-licensing business in which third parties would be allowed to access and search data on its platform.

For example, Google on Thursday announced an expanded partnership with Reddit that will give the search giant access to the company's data to, among other uses, train its AI models. 'In January 2024, we entered into certain data licensing arrangements with an aggregate contract value of $203.0 million and terms ranging from two to three years,' Reddit said, regarding its data-licensing business. 'We expect a minimum of $66.4 million of revenue to be recognized during the year ending December 31, 2024 and the remaining thereafter.' On Wednesday, Reddit said it plans to sell a chunk of its IPO shares to 75,000 of its most loyal users.

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