Reddit NYSE:RDDT rose 0.16% in premarket trading after Jefferies said the company is set up for second-quarter upside, citing strong advertising checks, steady traffic, and progress on engagement. The firm's traffic work showed US web and app daily active users swinging from small monthly declines early in the year to low-single-digit monthly growth through the quarter, with total web DAU growth ticking up to 16% year over year from 15% in the first quarter.
Jefferies said advertisers reported Reddit continuing to take share from mid-sized social platforms including LinkedIn, Pinterest, Snap, and X, while digital ad spending broadly accelerated in the quarter. That combination suggests Reddit gained from a faster-growing market on top of its own share gains. The firm projects 47% year-over-year revenue growth, driven mainly by average revenue per user, and sees room to close Reddit's roughly 70% ARPU discount to US peers.
Jefferies added that investors are looking for revenue and EBITDA to land mid-single digits and low-double digits above consensus, respectively, and expects third-quarter guidance to top consensus. User growth stays the central debate, with the market watching for a sequential rise in US logged-in DAU net additions against 200,000 in the first quarter. Reddit is scheduled to release its Q2 2026 results on July 30.