Reddit Inc (RDDT) Stock Forecast & Price Target

Reddit is projected to achieve significant growth, ending FY26 with approximately 135.8 million daily active users (DAUs), representing a 13% year-over-year increase, and an average revenue per user (ARPU) of $5.66, reflecting a 21% annual growth. The platform is also experiencing robust international expansion, with quarterly international DAU growth of 31.4% year-over-year, supported by marketing initiatives and product enhancements, contributing to an increase in its revenue share from international markets. Additionally, significant improvements in advertising capabilities, such as personalized ads and automated campaign setups, are likely to enhance user engagement and advertiser interest, positioning Reddit favorably in the competitive social media landscape.

Reddit has consistently reported net losses since its inception, raising concerns about its ability to achieve and sustain profitability if revenue growth fails to outpace rising operating expenses. The platform's advertising revenue dependence on a concentrated pool of advertisers makes it vulnerable to budget declines, which could significantly impact financial performance. Additionally, risks such as slowing user growth, falling average revenue per user (ARPU), and economic downturns further complicate Reddit's revenue outlook, suggesting potential challenges in maintaining its financial stability.