Reddit is considering a listing on the New York Stock Exchange in March.
The IPO comes after years of consideration. According to Reuters sources, social media platform Reddit has developed extensive plans for an IPO in late March this year. The intention to go public will likely be announced in late February. The IPO should then be completed by the end of March.
Stock market value
After an investment round, Reddit was valued at about $10 billion (€9.2 billion) in 2021. During the IPO, the social media platform plans to sell about 10 per cent of its shares. According to Reuters sources, the exact expected market capitalization will not be announced until the time of the final listing.
Reddit’s IPO comes after the platform became more profitable by its admission. The platform gets its revenue mainly from ads and also offers a premium subscription for $5.99 a month. Despite this, the company is still making losses.
Higher ad revenue and paid APIs
Still, Reddit draws hope from ad revenue generated in 2023, which, despite a poor ad market, at $800 million, was 20 per cent higher than in 2022. Incidentally, the social media platform aimed for $1 billion in ad revenue, writes The Information.
In addition, the platform announced last year that it would charge companies to use its APIs. Companies mainly use these APIs to train LLMs. Some users, whose apps depend on Reddit for access, disagreed with these fees and rebelled.
Ultimately, the social media platform backed down but did announce later in 2023 that it would fight the major LLM providers over the use of its data to train those models.
Reddit itself would not comment on the IPO rumours.
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