Reddit's Share Price Surges 128% Amidst Impressive Earnings and Legal Challenges

Reddit's share price surged 128% over the last quarter, driven by unexpected positive earnings with sales reaching $499 million. The company maintains robust earnings guidance and has been added to multiple indices, despite facing a class-action lawsuit. The total return over the past year was 348.83%, outperforming its industry and the broader market. Analysts predict a 20.5% decline in the share price, but Reddit's profitability and revenue trajectory provide foundational support for long-term growth considerations.

Reddit, Inc. (NYSE: RDDT) has experienced a remarkable turnaround, with its share price soaring 128% over the last quarter. The company's sales reached $499 million, marking a significant contrast to prior-year losses. This surge in performance occurred during a broader market gain of 17% year-over-year, with Reddit also being added to multiple indices, potentially enhancing its market visibility [2].

Despite facing a class action lawsuit over alleged misleading statements on Google's AI impacts, Reddit maintained robust earnings guidance. The lawsuit alleges that Reddit made false and misleading statements regarding the impact of Google's search algorithm changes on its traffic and advertising revenues [1]. The company's total return over the past year was 348.83%, outperforming its industry and the broader market, which returned 17% in the same period [2].

Analysts predict a 20.5% decline in the share price, reflecting potential volatility and market skepticism regarding future valuation. However, Reddit's profitability and revenue trajectory provide foundational support for evaluating long-term growth considerations. The company's current share price is at $246.50, with an analyst consensus price target of $195.96 [2].

Investors who purchased Reddit securities during the class period (October 29, 2024, to May 20, 2025) are encouraged to seek counsel before the August 18, 2025, lead plaintiff deadline. The Rosen Law Firm, a global investor rights law firm, has reminded investors of this deadline and encouraged them to secure counsel to participate in the class action [4].

References:
[1] https://www.globenewswire.com/news-release/2025/08/15/3134441/673/en/RDDT-DEADLINE-MONDAY-ROSEN-A-TOP-RANKED-LAW-FIRM-Encourages-Reddit-Inc-Investors-with-Losses-in-Excess-of-100K-to-Secure-Counsel-Before-Important-August-18-Deadline-in-Securities-C.html
[2] https://ca.finance.yahoo.com/news/reddit-rddt-shares-soar-128-171107961.html
[3] https://www.marketscreener.com/news/rddt-shareholders-have-the-right-to-lead-the-reddit-inc-securities-lawsuit-contact-the-djs-law-g-ce7c5ed2dd8df622
[4] https://www.marketscreener.com/news/rddt-deadline-rosen-skilled-investor-counsel-encourages-reddit-inc-investors-to-secure-counsel-ce7c51d9dc88f626