VOL. XCIV, NO. 247
WIDE MOAT STOCKS & COMPETITIVE ADVANTAGES
Reddit, Inc. RDDT
NYSEInternet platformsFinancials to Jun 30, 2026 · Updated Oct 7, 2026
Moat ranks
Balance sheet
| $B | Dec 31 | Jun 30 |
|---|---|---|
| Cash | 1.0 | 1.5 |
| Securities | 1.5 | 1.3 |
| Debt | 0.0 | 0.0 |
| Net cash | 2.5 | 2.8 |
| Equity | 2.9 | 3.3 |
- Debt / EBITDA
- 0.00×
- Debt / equity
- 0.00×
- Leases (6/30/26)
- $21M
- Diluted shares
- 202M
- Book value / share
- $16.26
- Price / book
- 8.7×
- Net cash / share
- $13.79
- Market cap
- $28.7B
- Enterprise value
- $25.9B
Per-share record
Key indicators
| Indicator | Latest | Vs year ago | Last 8 quarters |
|---|---|---|---|
| Revenue growth | 61.1% | -16.6 pts | |
| Operating margin | 28.8% | +15.2 pts | |
| FCF margin | 32.4% | +10.2 pts | |
| Capex / revenue | 0.1% | +0.0 pts | |
| Daily active uniques | 130.3M | +18% | |
| Weekly active uniques | 514.6M | +24% | |
| Logged-in daily active uniques | 52.6M | +7% | |
| U.S. daily active uniques | 53.2M | +6% | |
| International daily active uniques | 77.1M | +28% |
Margins and growth from reported quarters; company KPIs as reported in results releases.
About RDDT
Reddit operates a community platform monetized mainly through advertising, with smaller content-licensing and user-product revenue. Its core moat is a direct community network: users and volunteer moderators create topic-organized conversations and curation that attract other users and advertisers.
- Direct Network Effects
Reddit's users and volunteer moderators create communities, conversations and curation that make the service more useful to other users; the resulting audience and contextual intent attract advertisers, but advertising itself is not a reciprocal network side.
- Reputation Reviews
Reddit's moat is strongest where users seek peer recommendations and product research; authentic, topic-specific discussions make ad placements more context-rich than generic social feeds.
- Content Rights Currency
Reddit controls contractual access to a large, current and topic-organized corpus of human conversation that is valuable to AI and information customers, but public visibility, unlicensed scraping and unsettled user-content rights limit exclusivity.
- Sep 3, 2026
Reddit opened Max campaigns to all advertisers, adding automated targeting, placements and creative groups with third-party API access. The launch broadens access to performance ads; repeat spending will test its economic value. https://redditinc.com/news/performance-unlocked-reddit-max-campaigns-are-now-available-to-all-advertisers
- Aug 18, 2026
Reddit joined the S&P 500, extending index-fund demand for its shares. Index inclusion changes the shareholder base; it does not improve the community or advertising moat. https://investor.redditinc.com/news-events/news-releases/news-details/2026/Reddit-Will-Be-Added-to-the-SP-500/default.aspx
- Aug 12, 2026
Reddit named Paul Cappuccio as its next chief legal officer, with a mid-September start after Ben Lee steps down. The change places a new leader over privacy compliance and content-rights disputes. https://redditinc.com/news/paul-cappuccio-named-reddits-new-chief-legal-officer
- Jul 31, 2026
A federal court allowed most of Reddit’s claims against SerpApi and Perplexity to proceed while dismissing other claims. The ruling supports pursuing access-control protection, but does not establish liability or award payment. https://www.nysd.uscourts.gov/sites/default/files/2026-07/25cv8763%2C%20Reddit%20Inc.%20v.%20SerpApi%20LLC%20et%20al.%20-%20Opinion%20%26%20Order-1.pdf
- Feb 24, 2026
The UK regulator fined Reddit GBP14.47 million for children’s privacy failures. Reddit appealed, leaving the financial outcome and age-verification burden unresolved. https://ico.org.uk/about-the-ico/media-centre/news-and-blogs/2026/02/reddit-issued-with-1447m-fine-for-children-s-privacy-failures/
Ownership
Go deeper on RDDT
- Compare stock research toolsFundamentals, valuation and screening platforms for RDDT.18 tools
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- Read RDDT's earnings callsTranscripts and audio of results calls, with management's own words.16 tools
- Investing tool dealsCurrent discounts on research, charting and tracking tools.80 deals
On this page
Financial record
| Fiscal year | 2022 | 2023 | 2024 | 2025 | TTM | Trend | Change 2022–25 |
|---|---|---|---|---|---|---|---|
| Per share ($) | |||||||
| Revenue | 11.65 | 13.60 | 8.94 | 10.90 | 13.75 | -2.2%/yr | |
| Cash flow | -1.64 | -1.27 | 1.53 | 3.42 | 5.08 | – | |
| Earnings | -2.77 | -1.54 | -3.33 | 2.62 | 4.31 | – | |
| Free cash flow | -1.75 | -1.43 | 1.48 | 3.39 | 5.04 | – | |
| Capex | 0.11 | 0.16 | 0.04 | 0.03 | 0.04 | -32.7%/yr | |
| Dividends | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | – | |
| Book value | -6.62 | -6.98 | 14.65 | 14.49 | 16.26 | – | |
| Diluted shares (M) | 57 | 59 | 145 | 202 | 202 | +52.3%/yr | |
| Totals ($B) | |||||||
| Revenue | 0.7 | 0.8 | 1.3 | 2.2 | 2.8 | +48.9%/yr | |
| Operating income | -0.2 | -0.1 | -0.6 | 0.4 | 0.8 | – | |
| Net income | -0.2 | -0.1 | -0.5 | 0.5 | 0.9 | – | |
| Free cash flow | -0.1 | -0.1 | 0.2 | 0.7 | 1.0 | – | |
| Buybacks | 0.0 | 0.0 | 0.0 | 0.0 | 0.2 | – | |
| Dividends | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | – | |
| Net cash | 1.3 | 1.2 | 1.8 | 2.5 | 2.8 | +$1.2B | |
| Margins & returns (%) | |||||||
| Gross margin | 84.3 | 86.2 | 90.5 | 91.2 | 91.4 | +6.9 pts | |
| Operating margin | -25.8 | -17.4 | -43.1 | 20.1 | 28.2 | +45.9 pts | |
| Net margin | -23.8 | -11.3 | -37.2 | 24.1 | 31.3 | +47.8 pts | |
| FCF margin | -15.0 | -10.6 | 16.6 | 31.1 | 36.7 | +46.1 pts | |
| ROIC | – | – | -192.6 | 97.4 | 156.6 | – | |
| Return on equity | – | – | -22.7 | 18.1 | 26.5 | – | |
| R&D % of revenue | 54.8 | 54.5 | 71.9 | 35.6 | 30.0 | -19.2 pts | |
| Stock pay % of revenue | 8.3 | 5.9 | 61.7 | 15.6 | 12.2 | +7.3 pts | |
| Capex % of revenue | 0.9 | 1.2 | 0.5 | 0.3 | 0.3 | -0.6 pts | |
Change uses 2022 and 2025 only: compound annual growth for amounts, points for margins and returns, and the change in amount for net cash. A dash means no 2022 base. Trend shows the fiscal years.
Moat
Moat scorecard
- Strength
- Confidence
- Structure
- Oligopoly
- Durability
- medium
- Trajectory
- widening
- Pricing power
- moderate
- Advertising94.4%2 claims
- Content Licensing and User Products5.6%1 claim
Moat claims
- Applies to
- Advertising
- Confidence
- Durability
- medium
- Trajectory
- wideningas of Jul 31, 2026
Reddit's users and volunteer moderators create communities, conversations and curation that make the service more useful to other users; the resulting audience and contextual intent attract advertisers, but advertising itself is not a reciprocal network side.
Daily and weekly audiences continued to expand through Q2 2026, especially overseas. Logged-in daily users grew only 7%, so broader reach is stronger evidence than a deeper daily habit.
- Daily active uniques130,300,000+18%
- Weekly active uniques514,600,000+24%
- Logged-in daily active uniques52,600,000+7%
- U.S. daily active uniques53,200,000+6%
- International daily active uniques77,100,000+28%
- U.S. logged-in daily active uniques23,100,000+1%
- Ad impressions growth~+17%
- Advertising revenue$762M+64%
- Google AI Overviews, ChatGPT, Gemini or other AI products reduce search-driven visits
- Moderator dissatisfaction weakens community quality
- Users migrate time spent to TikTok, Instagram, YouTube, Discord or X
- Brand-safety failures reduce advertiser demand
- FilingReddit Q2 2026 Form 10-Q: international growth and monetizationJul 31, 2026
- FilingReddit, Inc. 2025 Form 10-KFeb 6, 2026
- FilingReddit Q2 2026 results / Form 8-K exhibitJul 30, 2026
- FilingReddit, Inc. 2025 Form 10-KFeb 6, 2026
- Applies to
- Advertising
- Confidence
- Durability
- medium
- Trajectory
- wideningas of Sep 3, 2026
Reddit's moat is strongest where users seek peer recommendations and product research; authentic, topic-specific discussions make ad placements more context-rich than generic social feeds.
Higher ad prices and reported revenue per user show that advertisers value the audience more. September access to automated Max campaigns expands the sales opportunity, but the product and early tests do not prove that users trust discussions more.
- Logged-in daily active uniques52,600,000+7%
- U.S. logged-in daily active uniques23,100,000+1%
- Average revenue per unique$6.18+36%
- U.S. average revenue per unique$11.85+51%
- International average revenue per unique$2.26+31%
- Ad pricing growth~+40%
- Ad impressions growth~+17%
- Advertising revenue$762M+64%
- Spam, low-quality AI content or astroturfing reduces trust
- Paid promotions blur the line between authentic discussion and advertising
- Communities restrict brand participation
- Regulation or platform policy limits targeted advertising
- FilingReddit, Inc. 2025 Form 10-KFeb 6, 2026
- FilingReddit, Inc. 2025 Form 10-KFeb 6, 2026
- FilingReddit Q2 2026 Form 10-QJul 31, 2026
- Applies to
- Content Licensing and User Products
- Confidence
- Durability
- medium
- Trajectory
- stableas of Jul 31, 2026
Reddit controls contractual access to a large, current and topic-organized corpus of human conversation that is valuable to AI and information customers, but public visibility, unlicensed scraping and unsettled user-content rights limit exclusivity.
Other revenue grew, but two customers still account for nearly all licensing contract value and obligations are being delivered faster than they are replenished. The July scraping ruling allowed core claims to proceed; it did not award damages or establish final exclusivity.
- Content licensing remaining obligations$92M-53%
- Other revenue$43M+24%
- Courts or regulators limit platform rights to commercialize user-generated content
- AI companies rely on synthetic data, web-scale scraping or alternative corpora
- Users reduce posting if licensing is perceived as exploitative
- Data-access restrictions provoke developer or moderator backlash
- FilingReddit Q2 2026 results / Form 8-K exhibitJul 30, 2026
- FilingReddit, Inc. 2025 Form 10-KFeb 6, 2026
- FilingReddit Q2 2026 Form 10-QJul 31, 2026
Profile change log
- Oct 7, 2026 · business change
Reddit opened Max campaigns to all advertisers, adding automated targeting, placements and creative groups with third-party API access. The launch broadens access to performance ads; repeat spending will test its economic value. https://redditinc.com/news/performance-unlocked-reddit-max-campaigns-are-now-available-to-all-advertisers
- Oct 7, 2026 · business change
Reddit joined the S&P 500, extending index-fund demand for its shares. Index inclusion changes the shareholder base; it does not improve the community or advertising moat. https://investor.redditinc.com/news-events/news-releases/news-details/2026/Reddit-Will-Be-Added-to-the-SP-500/default.aspx
- Oct 7, 2026 · business change
Reddit named Paul Cappuccio as its next chief legal officer, with a mid-September start after Ben Lee steps down. The change places a new leader over privacy compliance and content-rights disputes. https://redditinc.com/news/paul-cappuccio-named-reddits-new-chief-legal-officer
- Oct 7, 2026 · business change
A federal court allowed most of Reddit’s claims against SerpApi and Perplexity to proceed while dismissing other claims. The ruling supports pursuing access-control protection, but does not establish liability or award payment. https://www.nysd.uscourts.gov/sites/default/files/2026-07/25cv8763%2C%20Reddit%20Inc.%20v.%20SerpApi%20LLC%20et%20al.%20-%20Opinion%20%26%20Order-1.pdf
- Oct 7, 2026 · business change
The UK regulator fined Reddit GBP14.47 million for children’s privacy failures. Reddit appealed, leaving the financial outcome and age-verification burden unresolved. https://ico.org.uk/about-the-ico/media-centre/news-and-blogs/2026/02/reddit-issued-with-1447m-fine-for-children-s-privacy-failures/
- Oct 7, 2026 · business change
Reddit completed its IPO, converting preferred stock and satisfying vesting conditions that recognized $534.7 million of accumulated share-award expense. This changes the basis for comparisons with private-company years.
- Oct 7, 2026 · analyst revision
The community and recommendation advantages are widening with reach and monetization; licensing stays stable pending renewals and enforceable rights. Added separate user, ad, licensing and dilution tests, founder voting control and macro risks without changing moat scores.
- Oct 7, 2026 · analyst revision
Replaced the mixed-source 1.15%–1.5% advertising share range with no estimate: the source’s forecast share does not clearly refer to 2025, and the IAB and EMARKETER definitions differ. Corrected 2025 10-K evidence dates from February 4 to its February 6 filing date.
Industry & peers
Peer map
Hover a point for its values; click a peer to compare. Dashed lines: industry medians.
Global digital advertising
Worldwide spending on ads shown on internet-connected devices, including search, social, video, display, retail media and classified ads. Excludes offline media, hardware sales and paid subscriptions; platform shares use net advertising revenue across all company properties.
| Stocks | Moat | Gross m. | Op. m. | |
|---|---|---|---|---|
| RDDT | 75 | 91.4% | 28.2% | |
| Industry median | 19 | 75 | 56.7% | 25.1% |
| Sector median | 17 | 81 | 56.7% | 28.2% |
| All stocks median | 398 | 76 | 52.9% | 19.6% |
Moat medians cover every stock. Margin medians count only stocks with collected numbers and need at least three.
Drivers & risks
- More commerce and media consumption online move budgets toward measurable digital ads; social video and retail media compete for the same spending. China short video and closed-loop commerce connect ads to shopping. Weixin, Douyin, Alibaba and Kuaishou compete for advertiser demand; stronger recommendation tools can improve conversion without creating exclusive buyers.
- Better recommendation, conversion prediction and creative tools can improve advertiser results and support demand at higher ad volume.
- Large platforms distribute product improvements across existing audiences and buyers; reach and measurement favor the largest networks.
- The economic cycle strongly affects auctions: healthy consumer spending and affordable business finance support budgets, while recessions and high borrowing costs can reduce them quickly.
- Currencies have a medium effect on global reported revenue; exchange rates change the dollar value of overseas sales and the purchasing power of local advertisers.
- Google, Amazon, TikTok and other channels offer alternative audiences and purchase intent; users and advertisers can use several platforms and shift spending quickly.
- Privacy, consent, youth-safety and competition rules can restrict data use or engagement features, create fines and change operating costs.
- Apple and Google control important mobile distribution and data signals; policy changes can reduce targeting and measurement without reducing the audience.
- AI compute, memory, energy and talent costs have a strong effect on platform cash generation; infrastructure commitments can rise before ad returns are proven.
- Too many ads, low-quality AI content, scams or unsafe content can weaken user attention and advertiser trust.
- China consumer confidence and content, data and competition regulation have a strong effect on auction demand and permitted targeting. Growth in Tencent’s ads cannot be generalized to all regions.
- Community publishers depend on search referrals and volunteer moderation. AI summaries, spam and poor contributor incentives can reduce the attention that advertisers buy.
Bulls & bears
Can Reddit turn search-driven reach into a durable audience and repeat advertiser demand while protecting the human content that makes the service useful?
Arguments
What to watch
- 1Daily and weekly uniques, U.S. and international, with a separate check on direct engagement
- 2Reported ad price and impression growth; higher ad load can lift sales while weakening the user experience
- 3U.S. and international revenue per unique, compared within the same seasonal quarter
- 4Stock compensation, diluted shares and buybacks; cash flow does not show the cost of dilution
- 5Other revenue and long-term remaining obligations; new renewals matter more than delivery of old contracts
- 6Content licensing rulings, youth privacy requirements and moderator or spam problems
Next check: Review Q3 2026 results when released. Logged-in/out daily-user reporting stops that quarter; seek direct engagement or retention evidence, ad demand, licensing renewals and the tax allowance position. No results date was confirmed at collection.
Sources: company filings and dated sources collected for Find My Moat; market cap as of Oct 6, 2026. Not investment advice.
Free to reuse, commercially too, with a credit link. See the data license.
Moat Score 75/100 by <a href="https://www.findmymoat.com/stocks/XNYS:RDDT">Find My Moat</a> (as of September 2026)Request update
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