Item 1. Financial Statements

79K characters. Original on sec.gov · Markdown

Item 1. Financial Statements

Reddit, Inc.

Consolidated Statements of Operations

(in thousands, except share and per share amounts)

(unaudited)


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025
Revenue	$	804,905	$	499,627	$	1,468,316	$	891,988
Costs and expenses:
Cost of revenue	70,308		45,900		126,575		82,989
Research and development	231,276		196,610		438,522		387,881
Sales and marketing	195,897		120,619		347,369		211,304
General and administrative	75,708		68,787		141,222		138,200
Total costs and expenses	573,189		431,916		1,053,688		820,374
Income from operations	231,716		67,711		414,628		71,614
Other income (expense), net	25,119		21,147		47,935		41,681
Income before income taxes	256,835		88,858		462,563		113,295
Income tax expense (benefit)	3,987		(439)		5,734		(2,160)
Net income	$	252,848	$	89,297	$	456,829	$	115,455
Net income per share attributable to Class A and Class B common stock (Note 4)
Basic	$	1.31	$	0.48	$	2.38	$	0.63
Diluted	$	1.25	$	0.45	$	2.26	$	0.58
Weighted-average shares of Class A and Class B common stock used to compute net income per share attributable to common stockholders
Basic	192,345,684		185,437,777		191,932,329		183,730,992
Diluted	202,029,721		199,522,433		202,326,864		200,681,458

The accompanying notes are an integral part of these financial statements.

Reddit, Inc.

Consolidated Balance Sheets

(in thousands, except share and per share amounts)


	June 30, 2026		December 31, 2025
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	1,486,838	$	953,569
Marketable securities	1,299,519		1,523,242
Accounts receivable, net	650,098		590,162
Prepaid expenses and other current assets	105,210		69,012
Total current assets	3,541,665		3,135,985
Property and equipment, net	11,981		12,710
Operating lease right-of-use assets, net	18,411		20,788
Intangible assets, net	10,565		15,521
Goodwill	42,174		42,174
Other noncurrent assets	11,809		11,995
Total assets	$	3,636,605	$	3,239,173
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	89,144	$	62,929
Operating lease liabilities	7,783		7,023
Accrued expenses and other current liabilities	240,822		201,331
Total current liabilities	337,749		271,283
Operating lease liabilities, noncurrent	13,084		16,191
Other noncurrent liabilities	72		22,661
Total liabilities	350,905		310,135
Commitments and contingencies (Note 9)
Stockholders’ equity:
Preferred stock, par value $0.0001 per share; 100,000,000 shares authorized as of June 30, 2026 and December 31, 2025; no shares issued and outstanding as of June 30, 2026 and December 31, 2025	—		—
Class A common stock, par value $0.0001 per share; 2,000,000,000 shares authorized as of June 30, 2026 and December 31, 2025; 145,841,108 and 139,218,373 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively	14		14
Class B common stock, par value $0.0001 per share; 140,000,000 shares authorized as of June 30, 2026 and December 31, 2025; 46,480,309 and 51,673,735 shares issued and outstanding as of June 30, 2026 and December 31, 2025, respectively	5		5
Class C common stock, par value $0.0001 per share; 100,000,000 shares authorized as of June 30, 2026 and December 31, 2025; no shares issued and outstanding as of June 30, 2026 and December 31, 2025	—		—
Additional paid-in capital	3,504,664		3,595,772
Accumulated other comprehensive income (loss)	(4,695)		4,364
Accumulated deficit	(214,288)		(671,117)
Total stockholders’ equity	3,285,700		2,929,038
Total liabilities and stockholders’ equity	$	3,636,605	$	3,239,173

The accompanying notes are an integral part of these financial statements.

Reddit, Inc.

Consolidated Statements of Comprehensive Income (Loss)

(in thousands)

(unaudited)


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025
Net income	$	252,848	$	89,297	$	456,829	$	115,455
Other comprehensive income (loss), net of tax:
Change in unrealized gains (losses) on marketable securities	(2,292)		(158)		(6,055)		185
Change in foreign currency translation adjustment	(1,424)		2,571		(3,004)		3,518
Net comprehensive income	$	249,132	$	91,710	$	447,770	$	119,158

The accompanying notes are an integral part of these financial statements.

Reddit, Inc.

Consolidated Statements of Stockholders’ Equity

(in thousands, except share amounts)

(unaudited)


			Three months ended June 30, 2025
		Common Stock						Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total Stockholders’ Equity
	Class A			Class B
			Shares		Amount		Shares	Amount
Balance as of March 31, 2025			129,145,465		$	13	55,121,821	$	5	$	3,390,469	$	1,314	$	(1,174,680)	$	2,217,121
Issuance of common stock upon exercise of stock options, net			358,393		—		629,769	—		4,303		—		—		4,303
Issuance of common stock upon settlement of restricted stock units, net			1,801,956		—		17,251	—		(15,224)		—		—		(15,224)
Conversion of Class B common stock to Class A common stock			656,715		—		(656,715)	—		—		—		—		—
Stock-based compensation expense			—		—		—	—		89,070		—		—		89,070

Net income			—		—		—	—		—		—		89,297		89,297
Change in other comprehensive income			—		—		—	—		—		2,413		—		2,413
Balance as of June 30, 2025			131,962,529		$	13	55,112,126	$	5	$	3,468,618	$	3,727	$	(1,085,383)	$	2,386,980

			Three months ended June 30, 2026
		Common Stock						Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total Stockholders’ Equity
	Class A			Class B
			Shares		Amount		Shares	Amount
Balance as of March 31, 2026			141,867,916		$	14	50,543,398	$	5	$	3,647,812	$	(979)	$	(467,136)	$	3,179,716
Issuance of common stock upon exercise of stock options, net			411,629		—		6,741	—		5,037		—		—		5,037
Issuance of common stock upon settlement of restricted stock units, net			946,119		—		34,426	—		(14,546)		—		—		(14,546)
Conversion of Class B common stock to Class A common stock			4,104,256		—		(4,104,256)	—		—		—		—		—

Repurchases of Class A common stock			(1,488,812)		—		—	—		(234,591)		—		—		(234,591)
Stock-based compensation expense			—		—		—	—		100,952		—		—		100,952

Net income			—		—		—	—		—		—		252,848		252,848
Change in other comprehensive income			—		—		—	—		—		(3,716)		—		(3,716)
Balance as of June 30, 2026			145,841,108		$	14	46,480,309	$	5	$	3,504,664	$	(4,695)	$	(214,288)	$	3,285,700

Reddit, Inc.

Consolidated Statements of Stockholders’ Equity

(in thousands, except share amounts)

(unaudited)


	Six months ended June 30, 2025
	Common Stock						Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total Stockholders’ Equity
	Class A			Class B
	Shares	Amount		Shares	Amount
Balance as of December 31, 2024	125,001,880	$	12	55,314,099	$	5	$	3,331,546	$	24	$	(1,200,838)	$	2,130,749
Issuance of common stock upon exercise of stock options, net	1,363,474	—		1,456,450	—		14,487		—		—		14,487
Issuance of common stock upon settlement of restricted stock units, net	3,904,250	1		34,502	—		(51,899)		—		—		(51,898)
Conversion of Class B common stock to Class A common stock	1,692,925	—		(1,692,925)	—		—		—		—		—
Stock-based compensation expense	—	—		—	—		174,484		—		—		174,484
Net income	—	—		—	—		—		—		115,455		115,455
Change in other comprehensive income (loss)	—	—		—	—		—		3,703		—		3,703
Balance as of June 30, 2025	131,962,529	$	13	55,112,126	$	5	$	3,468,618	$	3,727	$	(1,085,383)	$	2,386,980

	Six months ended June 30, 2026
	Common Stock						Additional Paid-in Capital		Accumulated Other Comprehensive Income (Loss)		Accumulated Deficit		Total Stockholders’ Equity
	Class A			Class B
	Shares	Amount		Shares	Amount
Balance as of December 31, 2025	139,218,373	$	14	51,673,735	$	5	$	3,595,772	$	4,364	$	(671,117)	$	2,929,038
Issuance of common stock upon exercise of stock options, net	814,359	—		45,204	—		9,936		—		—		9,936
Issuance of common stock upon settlement of restricted stock units, net	2,024,395	—		68,853	—		(30,742)		—		—		(30,742)
Conversion of Class B common stock to Class A common stock	5,307,483	—		(5,307,483)	—		—		—		—		—
Repurchases of Class A Common Stock	(1,523,502)	—		—	—		(239,590)		—		—		(239,590)
Stock-based compensation expense	—	—		—	—		169,288		—		—		169,288
Net income	—	—		—	—		—		—		456,829		456,829
Change in other comprehensive income (loss)	—	—		—	—		—		(9,059)		—		(9,059)
Balance as of June 30, 2026	145,841,108	$	14	46,480,309	$	5	$	3,504,664	$	(4,695)	$	(214,288)	$	3,285,700

Reddit, Inc.

Consolidated Statements of Cash Flows

(in thousands)

(unaudited)


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025
Cash flows from operating activities
Net income	$	252,848	$	89,297	$	456,829	$	115,455
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	4,258		3,934		8,468		7,897



Non-cash operating lease cost	1,743		1,514		3,419		2,982
Amortization of premium (accretion of discount) on marketable securities, net	(2,799)		(6,691)		(7,096)		(15,575)
Stock-based compensation expense	100,952		89,070		169,288		174,484


Other adjustments	85		97		(606)		(41)
Changes in operating assets and liabilities:
Accounts receivable	(127,228)		(81,116)		(59,271)		(57,757)
Prepaid expenses and other assets	(12,454)		(9,352)		(36,206)		(26,358)
Operating lease right-of-use assets and liabilities	(1,575)		(1,589)		(3,390)		(3,369)
Accounts payable	37,020		19,991		26,037		18,945
Accrued expenses and other liabilities	9,026		6,176		16,657		22,246
Net cash provided by (used in) operating activities	$	261,876	$	111,331	$	574,129	$	238,909
Cash flows from investing activities
Purchases of property and equipment	(1,134)		(505)		(2,224)		(1,484)


Purchases of marketable securities	(311,978)		(556,457)		(676,907)		(1,061,303)
Maturities of marketable securities	409,247		552,532		883,715		1,017,594
Proceeds from sale of marketable securities	—		—		17,989		12,372

Other investing activities	(1,421)		2,354		(3,037)		3,243
Net cash provided by (used in) investing activities	$	94,714	$	(2,076)	$	219,536	$	(29,578)
Cash flows from financing activities


Proceeds from exercise of employee stock options	5,037		4,303		9,936		14,487

Taxes paid related to net share settlement of restricted stock units	(14,546)		(15,225)		(30,742)		(51,900)

Repurchases of Class A common stock	(234,591)		—		(239,590)		—

Net cash provided by (used in) financing activities	$	(244,100)	$	(10,922)	$	(260,396)	$	(37,413)
Net increase (decrease) in cash and cash equivalents	112,490		98,333		533,269		171,918
Cash and cash equivalents at the beginning of the period	1,374,348		635,727		953,569		562,142
Cash and cash equivalents at the end of the period	$	1,486,838	$	734,060	$	1,486,838	$	734,060

The accompanying notes are an integral part of these financial statements.

Reddit, Inc.

Notes to the Consolidated Financial Statements

(unaudited)

1. Description of Business

Description of Business

Reddit, Inc. (“Reddit,” “we,” “our,” or “us”) was incorporated in the state of Delaware. Our mission is to empower communities and make their knowledge accessible to everyone. We built Reddit with the belief that communities unlock the power of human creativity and create a sense of belonging and empowerment for their members. We believe the world needs community more than ever, and that this represents our greatest opportunity to further enrich the lives of everyone in the world. We are headquartered in San Francisco, California, and have several offices around the world.

2. Basis of Presentation and Significant Accounting Policies

Basis of Presentation of Unaudited Interim Financial Information

Our consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”) and applicable rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”) regarding interim financial information. Our consolidated financial statements include the accounts of Reddit, Inc. and our wholly owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Certain information and disclosures normally included in the annual consolidated financial statements prepared in accordance with U.S. GAAP have been omitted. Accordingly, the unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2025 (our “Annual Report”). The unaudited interim consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and reflect, in our opinion, all the adjustments of a normal, recurring nature that are necessary for the fair statement of our financial position, results of operations, and cash flows for the interim periods, but are not necessarily indicative of the results expected for the full year or any other period.

Other than described below, there have been no changes to our significant accounting policies described in the “Notes to the Consolidated Financial Statements” included in our audited consolidated financial statements and related notes as of and for the year ended December 31, 2025 included in our Annual Report that have had a material impact on our consolidated financial statements and accompanying notes.

Use of Estimates

The preparation of the unaudited consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Management’s estimates are based on historical information available as of the date of the consolidated financial statements and various other assumptions that we believe are reasonable under the circumstances. Actual results could differ materially from those estimates.

Significant estimates relate primarily to the valuation of deferred tax assets, determining the fair value of stock-based awards, the fair value of assets and liabilities assumed in business combinations, and the incremental borrowing rate used to determine operating lease right-of-use assets and lease liabilities. On an ongoing basis, management evaluates our estimates compared to historical experience and trends, which form the basis for making judgments about the carrying value of assets and liabilities.

Income Taxes

We account for income taxes using the asset and liability method. We recognize deferred tax assets and liabilities for temporary differences between the financial reporting and tax bases of assets and liabilities using the enacted statutory tax rates in effect for the years in which we expect the differences to reverse. We establish valuation allowances to reduce the total deferred tax assets to the amount we believe is more likely than not to be realized. In assessing the need for a valuation allowance, we consider all available evidence, both positive and negative, including past operating results and estimates of future taxable income. Our judgment regarding the timing and amount of the valuation allowance release is subject to change based on a number of factors, including but not limited to, the level of profitability (income before income taxes adjusted for permanent differences) that we are able to accurately forecast, as well as the amount of our tax deductible stock-based compensation, which is dependent upon our publicly traded share price, and macroeconomic conditions, among other factors. In the event that we change our determination as to the amount of deferred tax assets that can be realized, we will adjust our

Reddit, Inc.

Notes to the Consolidated Financial Statements

(unaudited)

valuation allowance with a corresponding impact to the provision for (benefit from) income taxes in the period in which such determination is made.

Concentration of Credit Risk

Financial instruments that potentially subject us to significant concentrations of credit risk consist principally of cash and cash equivalents, restricted cash, marketable securities, and accounts receivable. We maintain cash and cash equivalents with several financial institutions. We believe that the financial institutions that hold our cash and cash equivalents are financially sound and, accordingly, minimal credit risks exist with respect to these balances. We maintain investments in U.S. and non-U.S. government securities, investment-grade corporate and government agency securities, time deposits, commercial paper, and money market accounts that carry high credit ratings and accordingly, minimal credit risk exists with respect to these balances.

Accounting Pronouncements Not Yet Adopted

In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires an entity to disclose disaggregated information about certain income statement expense line items. The standard is effective for us beginning January 1, 2027, with early adoption permitted. We are currently evaluating the impact the adoption will have on our disclosures.

In September 2025, the FASB issued ASU No. 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which aims to modernize the accounting for internal-use software costs to better align with current software development practices by removing references to prescriptive software development stages and establishing a new principle for when to begin capitalizing such costs. The standard is effective for us beginning January 1, 2028. We are currently evaluating the impact the adoption will have on our consolidated financial statements.

3. Revenue

The following table represents our revenue disaggregated by source:


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025
	(in thousands)
Advertising revenue	$	761,625	$	464,785	$	1,386,295	$	823,415
Other revenue	43,280		34,842		82,021		68,573
Total revenue	$	804,905	$	499,627	$	1,468,316	$	891,988

The following table represents our revenue disaggregated by geography based on the billing address of the customer:


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025
	(in thousands)
United States	$	638,119	$	408,842	$	1,163,680	$	722,694
Rest of world(1)	166,786		90,785		304,636		169,294
Total revenue	$	804,905	$	499,627	$	1,468,316	$	891,988

(1)Other than the United States, no individual country represented 10% or more of total revenue during the three and six months ended June 30, 2026 and 2025.

Deferred revenue was $38.6 million and $18.1 million as of June 30, 2026 and December 31, 2025, respectively. Revenue recognized during the six months ended June 30, 2026 and 2025 included substantially all of the deferred revenue balance at the beginning of each respective period.

As of June 30, 2026, the aggregate amount of remaining performance obligations in contracts with an original expected duration exceeding one year was $92.1 million. This amount consists primarily of long-term content licensing contracts and

Reddit, Inc.

Notes to the Consolidated Financial Statements

(unaudited)

excludes deferred revenue related to short-term advertising contracts and Reddit Premium subscriptions. We expect to recognize $62.0 million in the remainder of 2026 and $30.1 million in 2027.

4. Net Income per Share

We compute net income per share of Class A and Class B common stock using the two-class method required for multiple classes of common stock. Holders of our Class A and Class B common stock have identical rights except with respect to voting, conversion, and transfer rights, and therefore share equally in our net income or losses.

The following table presents the calculation of basic and diluted net income per share attributable to common stock:


	Three months ended June 30,								Six months ended June 30,
	2026				2025				2026				2025
	Class A		Class B		Class A		Class B		Class A		Class B		Class A		Class B
	(in thousands, except share and per share data)
Basic net income per share attributable to common stockholders:
Numerator:
Net income attributable to common stockholders	$	189,468	$	63,380	$	62,806	$	26,491	$	338,468	$	118,361	$	80,803	$	34,652
Denominator:
Basic weighted-average common shares outstanding	144,131,494		48,214,190		130,426,589		55,011,188		142,204,102		49,728,227		128,586,761		55,144,231
Basic income per share attributable to common stockholders	$	1.31	$	1.31	$	0.48	$	0.48	$	2.38	$	2.38	$	0.63	$	0.63
Diluted net income per share attributable to common stockholders:
Numerator:
Net income attributable to common stockholders	$	192,506	$	60,342	$	64,676	$	24,621	$	344,549	$	112,280	$	83,730	$	31,725
Denominator:
Basic weighted-average common shares outstanding	144,131,494		48,214,190		130,426,589		55,011,188		142,204,102		49,728,227		128,586,761		55,144,231
Weighted-average effect of dilutive potential common stock	9,684,037		—		14,084,656		—		10,394,535		—		16,950,466		—
Shares used in computation of diluted net income per share attributable to common stockholders	153,815,531		48,214,190		144,511,245		55,011,188		152,598,637		49,728,227		145,537,227		55,144,231
Diluted net income per share attributable to common stockholders	$	1.25	$	1.25	$	0.45	$	0.45	$	2.26	$	2.26	$	0.58	$	0.58

The following outstanding potentially dilutive shares were excluded from the computation of diluted net income per share attributable to common stock for the periods presented because the impact of including them would have been anti-dilutive.


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025
	Class A	Class B	Class A	Class B	Class A	Class B	Class A	Class B

Unvested RSUs and RSAs	13,539	—	433,058	—	13,712	—	126,137	—
Total	13,539	—	433,058	—	13,712	—	126,137	—

5. Fair Value Measurements

Fair value is defined as the price that would be received to sell an asset in an orderly transaction between market participants at the measurement date. To increase the comparability of fair value measures, the following hierarchy prioritizes the inputs to valuation methodologies used to measure fair value:

Level 1: Quoted market prices in active markets for identical assets or liabilities
Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data

Reddit, Inc.

Notes to the Consolidated Financial Statements

(unaudited)

Level 3: Unobservable inputs reflecting the reporting entity’s own assumptions or external inputs from inactive markets

We classify our cash equivalents and marketable securities within Level 1 or Level 2 because we use quoted market prices or alternative pricing sources and models utilizing market observable inputs to determine their fair value. There were no transfers between levels during the periods presented.

The following tables set forth our financial assets that are measured at fair value on a recurring basis:


		June 30, 2026
	Fair value hierarchy level	Cost or amortized cost		Gross unrealized gains		Gross unrealized losses		Fair value
		(in thousands)
Cash equivalents:
Money market funds	Level 1	$	1,306,708	$	—	$	—	$	1,306,708
U.S. treasury securities	Level 1	34,951		—		—		34,951

Time deposits	Level 2	26,438		—		—		26,438

Marketable securities:
U.S. treasury securities	Level 1	382,509		132		(1,061)		381,580
U.S. agency bonds	Level 2	428,113		—		(2,699)		425,414

Corporate bonds	Level 2	272,412		87		(447)		272,052
Time deposits	Level 2	142,813		—		—		142,813
Commercial paper	Level 2	77,701		2		(43)		77,660
Total		$	2,671,645	$	221	$	(4,250)	$	2,667,616


		December 31, 2025
	Fair value hierarchy level	Cost or amortized cost		Gross unrealized gains		Gross unrealized losses		Fair value
		(in thousands)
Cash equivalents:
Money market funds	Level 1	$	825,323	$	—	$	—	$	825,323
U.S. treasury securities	Level 1	11,934		1		—		11,935
Time deposits	Level 2	25,949		—		—		25,949
Marketable securities:
U.S. treasury securities	Level 1	450,474		1,035		(2)		451,507
U.S. agency bonds	Level 2	410,655		167		(134)		410,688

Corporate bonds	Level 2	306,321		820		(13)		307,128
Time deposits	Level 2	140,000		—		—		140,000
Commercial paper	Level 2	213,767		152		—		213,919
Total		$	2,384,423	$	2,175	$	(149)	$	2,386,449

Gross unrealized losses within accumulated other comprehensive income (loss) were immaterial as of June 30, 2026 and December 31, 2025. There were no impairment charges due to credit losses during the three and six months ended June 30, 2026 and 2025.

As of June 30, 2026, the amortized cost of marketable securities with maturities less than one year was $680.6 million. The amortized cost of marketable securities with maturities between one and five years was $623.0 million.

Reddit, Inc.

Notes to the Consolidated Financial Statements

(unaudited)

6. Balance Sheet Components

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consisted of the following:


	June 30, 2026		December 31, 2025
	(in thousands)
Accrued compensation and benefits	$	63,384	$	74,750
Deferred revenue	38,548		18,039
Accrued expenses	91,255		86,200

Accrued customer incentives, revenue share payable, and other	30,830		5,984

Other	16,805		16,358
Total accrued expenses and other current liabilities	$	240,822	$	201,331

Other Noncurrent Liabilities

Other noncurrent liabilities consisted of the following:


	June 30, 2026		December 31, 2025
	(in thousands)

Accrued customer incentives	$	—	$	22,555
Other	72		106
Total other noncurrent liabilities	$	72	$	22,661

7. Goodwill and Intangible Assets

Goodwill

The carrying amount of goodwill was $42.2 million as of December 31, 2025. There was no change in the carrying amount of goodwill during the six months ended June 30, 2026.

Acquired Intangible Assets

Acquired intangible assets consisted of the following:


	June 30, 2026
	Gross carrying value		Accumulated amortization		Net carrying value		Weighted-average remaining useful life (years)
	(in thousands, except year data)
Developed technology	$	47,460	$	36,921	$	10,539	1.1
Other intangible assets	600		600		—		—
Total acquired intangible assets	$	48,060	$	37,521	$	10,539


	December 31, 2025
	Gross carrying value		Accumulated amortization		Net carrying value		Weighted-average remaining useful life (years)
	(in thousands, except year data)
Developed technology	$	47,460	$	31,964	$	15,496	1.6
Other intangible assets	600		600		—		—
Total acquired intangible assets	$	48,060	$	32,564	$	15,496

Reddit, Inc.

Notes to the Consolidated Financial Statements

(unaudited)

Amortization expense was immaterial for the three and six months ended June 30, 2026 and 2025.

8. Debt

Revolving Line of Credit

On July 1, 2025, we entered into an Amended and Restated Credit and Guarantee Agreement, which amended and restated our prior Credit and Guarantee Agreement dated October 8, 2021 (as amended on May 23, 2023), and provides for a five-year, $500.0 million, revolving loan and standby letter of credit facility (“Revolving Credit Facility”) of which $100.0 million can be issued as letters of credit and another $100.0 million of which can be borrowed in certain non-U.S. dollar currencies. As of June 30, 2026, we have issued four letters of credit, three of which are denominated in a foreign currency, for an aggregate of $5.6 million, which reduced the letter of credit borrowings available under the Revolving Credit Facility to $94.4 million. The aggregate available balance under the Revolving Credit Facility was $494.4 million as of June 30, 2026.

Under the terms of the Revolving Credit Facility, borrowings can be ABR Loans, Term Benchmark Loans, or RFR Loans. Outstanding ABR Loans bear interest at a rate equal to the greatest of (A) the Prime Rate, (B) the NYFRB Rate plus 0.5%, or (C) the Adjusted Term SOFR Rate plus 1.0% (each as defined in the Revolving Credit Facility), in each case plus 0.25%. Outstanding Term Benchmark Loans bear interest at the Adjusted Term SOFR Rate, the Adjusted EURIBOR Rate, the Adjusted Term CORRA Rate, or the Adjusted AUD Rate (each as defined in the Revolving Credit Facility), as applicable, in each case plus 1.25%. Outstanding RFR Loans bear interest at a rate equal to the Adjusted Daily Simple RFR (as such term is defined in the Revolving Credit Facility) plus 1.25%. We are required to pay a quarterly commitment fee that accrues at 0.15% per annum on the unused portion of the aggregate commitments under the Revolving Credit Facility.

The Revolving Credit Facility contains customary conditions on our borrowings, including events of default and covenants. Covenants include restrictions on our and certain of our subsidiaries’ ability to incur indebtedness, grant liens, make distributions to holders of our preferred and common stock, make investments, or engage in transactions with our affiliates, and require us to adhere to a maximum total leverage ratio. The obligations under the Revolving Credit Facility are secured by liens on substantially all of our assets, including intellectual property assets. However, the Revolving Credit Facility provides for the permanent release of guarantees and collateral upon our achievement of certain investment grade ratings. We were in compliance with all covenants as of June 30, 2026.

9. Commitments and Contingencies

Purchase Obligations

We enter into contracts with non-cancellable purchase obligations, primarily related to third-party cloud infrastructure agreements under which we are granted access to certain cloud services. During the six months ended June 30, 2026, there were no material changes outside the normal course of business to our purchase obligations as disclosed in our Annual Report for the year ended December 31, 2025. In June 2026, we signed an addendum to extend our cloud services agreement with AWS through 2029. We committed under this agreement to spend an aggregate of $880.0 million between July 2026 and June 2029. We have met all minimum purchase commitments under these agreements during the periods presented.

Legal Matters and Indemnifications

From time to time, we may become involved in various legal and regulatory proceedings, claims or purported class actions related to, among other things, alleged infringement of third party patents and other intellectual property rights, commercial, corporate and securities, labor and employment, wage and hour and other claims arising in the normal course of business. We record a loss contingency when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We also disclose material contingencies when we believe a loss is not probable but reasonably possible. In June 2025, we and certain of our officers and directors were named as defendants in a securities class action lawsuit in the U.S. District Court for the Northern District of California. The lawsuit is brought on behalf of a purported class of purchasers or acquirers of our securities, alleging that we and certain of our officers made false or misleading statements and omissions concerning the impact of Google Search and its AI Overviews feature on our business. The complaint seeks unspecified damages and attorneys’ fees. Subsequently, shareholder derivative complaints with similar allegations were filed in the U.S. District Court for the Northern District of California against the Company, its directors, and members of our senior management. No responses to these complaints have been filed. Based on the preliminary nature of the proceedings in these cases, the outcome of these matters remains uncertain.

Reddit, Inc.

Notes to the Consolidated Financial Statements

(unaudited)

In February 2026, the United Kingdom Information Commissioner’s Office (“UK ICO”) issued a penalty notice under the UK General Data Protection Regulation, which includes a fine of GBP £14.5 million. We are challenging the UK ICO’s findings in an appeal of the penalty notice.

Accounting for contingencies requires us to use judgment related to both the likelihood of a loss and the estimate of the amount or range of loss. We are not aware of any other pending matters, individually or in the aggregate, that are expected to have a material adverse impact on our results of operations, financial position, or cash flows as of June 30, 2026. Legal fees and other expenses associated with such matters are expensed as incurred.

10. Stockholders' Equity

Share Repurchase Program

On February 4, 2026, our Board of Directors authorized a share repurchase program to purchase up to $1.0 billion of our Class A common stock (the “Share Repurchase Program”). Under the Share Repurchase Program, we may repurchase shares of our Class A common stock from time to time on the open market (including via pre-set trading plans), in privately negotiated transactions, or through other transactions in accordance with applicable securities laws. The Share Repurchase Program does not obligate us to acquire any particular amount of Class A common stock, has no expiration date, and may be suspended or discontinued at any time at our discretion. During the six months ended June 30, 2026, we repurchased 1,523,502 shares of Class A common stock for $239.6 million. As of June 30, 2026, $760.4 million remained available for repurchases.

We immediately retire shares repurchased under the Share Repurchase Program and reduce our Class A common stock component of stockholders’ equity by the par value of repurchased shares. The excess of the repurchase price over par value for shares repurchased is recorded to additional paid-in capital.

Common Stock Reserved for Issuance

In February 2024, our board of directors adopted the 2024 Incentive Award Plan (the “2024 Plan”), which became effective in connection with our initial public offering in March 2024. Under the 2024 Plan, shares of our Class A common stock are reserved for issuance pursuant to a variety of stock-based compensation awards, including stock options, stock appreciation rights, restricted stock awards, restricted stock units, performance bonus awards, performance stock unit awards, dividend equivalents, or other stock or cash based awards.

We have reserved the following shares of common stock, on an as-converted basis, for future issuance:


	June 30, 2026	December 31, 2025
Outstanding stock options	9,992,568	10,852,131
Outstanding RSUs	4,670,644	4,370,034


Remaining shares reserved for future issuances under the 2024 Plan	52,942,957	45,792,210
Shares reserved for community impact initiatives and charitable activities	1,337,205	1,337,205
Total shares of common stock reserved	68,943,374	62,351,580

The remaining shares reserved for future issuance under the 2024 Plan relate to our Class A common stock.

Reddit, Inc.

Notes to the Consolidated Financial Statements

(unaudited)

11. Stock-Based Compensation

RSUs and RSAs

Our restricted stock units (“RSUs”) and restricted stock awards (“RSAs”) vest based on the terms in the grant agreements and generally vest ratably over one to four years from the vesting commencement date. The following table summarizes the RSU and RSA activity for the six months ended June 30, 2026:


	Total RSUs and RSAs	Weighted- average grant date fair value
Unvested as of December 31, 2025	4,460,851	$	58.71
Granted	2,798,394	$	149.70
Vested	(2,323,949)	$	73.54
Canceled/Forfeited	(199,779)	$	93.48
Unvested as of June 30, 2026	4,735,517	$	103.73

As of June 30, 2026, we had RSUs and RSAs outstanding for 4,735,517 common shares, of which 4,361,703 relate to Class A common stock and 373,814 relate to Class B common stock. Total unrecognized stock-based compensation expense related to RSUs and RSAs was $397.3 million as of June 30, 2026 and is expected to be recognized over a weighted-average period of 0.89 years.

Stock Options

Stock options vest based on terms in the stock option agreement and generally vest over five years quarterly or four years with 25% of the award vesting one year from the vesting commencement date then ratably over the following three years. The following table summarizes the stock option activity during the six months ended June 30, 2026:


	Outstanding stock options	Weighted- average exercise price		Weighted- average remaining contractual life (years)	Aggregate intrinsic value
	(in thousands, except share, per share, and year data)
Balance as of December 31, 2025	10,852,131	$	38.38	7.14	$	2,078,120

Exercised	(859,563)	11.57

Balance as of June 30, 2026	9,992,568	$	40.68	6.91	$	1,327,993
Vested as of June 30, 2026	5,540,026	$	37.09	6.44	$	756,131
Vested and expected to vest as of June 30, 2026	9,992,568	$	40.68	6.91	$	1,327,993

As of June 30, 2026, we had outstanding stock options for 9,992,568 common shares, of which 8,505,974 relate to Class A common stock and 1,486,594 relate to Class B common stock. Total unrecognized stock-based compensation expense related to stock options was $69.3 million as of June 30, 2026 and is expected to be recognized over a weighted-average period of 2.49 years.

Reddit, Inc.

Notes to the Consolidated Financial Statements

(unaudited)

Stock-Based Compensation Expense

The following table summarizes the components of stock-based compensation expense recognized in the consolidated statements of operations for all periods presented:


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025
	(in thousands)
Cost of revenue	$	253	$	204	$	398	$	421
Research and development	$	65,857	56,663		108,267		109,273
Sales and marketing	$	12,079	10,198		17,902		20,336
General and administrative	$	22,763	22,005		42,721		44,454
Stock-based compensation expense	$	100,952	$	89,070	$	169,288	$	174,484

12. Income Taxes

Our provision for income taxes for interim periods is determined using an estimate of our annual effective tax rate, adjusted for discrete items, if any, that arise during the period. Each quarter, we update the estimate of the annual effective tax rate, and if the estimated annual effective tax rate changes, we make a cumulative adjustment in such period. For the three and six months ended June 30, 2026 and 2025, income tax expense (benefit) was immaterial.

We have a full valuation allowance against our United States federal and state deferred tax assets and will continue to maintain it until there is sufficient evidence to support the future utilization of these assets. Given our recent history of generating net income in the United States, we believe that there is a reasonable possibility that sufficient positive evidence may become available within the next 12 months to allow us to release a significant portion of the valuation allowance in the United States. The reversal would result in a significant income tax benefit in the period when we release it. However, the exact timing and amount of the valuation allowance release are subject to change based on a number of factors, including but not limited to, the level of profitability (income before income taxes adjusted for permanent differences) that we are able to accurately forecast, as well as the amount of our tax deductible stock-based compensation, which is dependent upon our publicly traded share price, and macroeconomic conditions, among other factors.

13. Related Parties and Related-Party Transactions

Advance Magazine Publishers Inc.

As of June 30, 2026, Advance Magazine Publishers Inc. (“Advance”) held approximately 22% of our outstanding shares of Class A and Class B common stock and is a related party to Reddit as Advance holds more than 10% of the voting power of our outstanding Class A and Class B common stock. There have been no changes to the terms of the agreements that govern Advance’s rights as disclosed in the audited consolidated financial statements as of and for the year ended December 31, 2025 included in our Annual Report.

We currently sublease office space in New York and Chicago from Advance. Total lease costs and other related expenses for our subleases were immaterial for the three and six months ended June 30, 2026 and 2025.

14. Segment and Geographic Information

Segment Information

We have one reportable segment as our chief operating decision maker, our Chief Executive Officer, reviews consolidated profitability measures in managing the business. Specifically, our chief operating decision maker uses consolidated net income

Reddit, Inc.

Notes to the Consolidated Financial Statements

(unaudited)

as the measure of segment profit or loss for evaluating performance and allocating resources through comparison of actual amounts against budgeted and prior period amounts in order to make strategic decisions.

The following table presents the calculation of segment net income:


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025
	(in thousands)
Revenue	$	804,905	$	499,627	$	1,468,316	$	891,988
Adjusted cost of revenue(1)	70,055		45,696		126,177		82,568
Adjusted gross profit	734,850		453,931		1,342,139		809,420

Adjusted operating expenses(2)	392,040		287,182		733,359		527,400
Stock-based compensation and related taxes	106,836		95,104		185,684		202,509
Depreciation and amortization	4,258		3,934		8,468		7,897
Interest (income) expense, net	(25,027)		(21,056)		(48,912)		(41,470)
Income tax expense (benefit)	3,987		(439)		5,734		(2,160)
Other segment expenses(3)	(92)		(91)		977		(211)
Segment net income	$	252,848	$	89,297	$	456,829	$	115,455
Consolidated net income	$	252,848	$	89,297	$	456,829	$	115,455

(1)Adjusted cost of revenue is cost of revenue adjusted for stock-based compensation and related taxes as follows:


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025
	(in thousands)
Cost of revenue	$	70,308	$	45,900	$	126,575	$	82,989
Less:
Stock-based compensation and related taxes	253		204		398		421

Adjusted cost of revenue	$	70,055	$	45,696	$	126,177	$	82,568

(2)Adjusted operating expenses is operating expenses (comprised of research and development, sales and marketing, and general and administrative expenses) adjusted for stock-based compensation and related taxes and depreciation and amortization as follows:


	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025
	(in thousands)
Operating expenses	$	502,881	$	386,016	$	927,113	$	737,385
Less:
Stock-based compensation and related taxes	106,583		94,900		185,286		202,088
Depreciation and amortization	4,258		3,934		8,468		7,897

Adjusted operating expenses	$	392,040	$	287,182	$	733,359	$	527,400

(3)Other segment expenses primarily includes realized gains and losses on sales of marketable securities and foreign currency transaction gains and losses.

Previous: Cover and table of contents · Next: Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations