Reddit's Q2 earnings surge as AI and ads drive growth
The report, which was released on Thursday, shows the social media giant reporting that advertising continues to be its dominant revenue stream, accounting for a staggering $465 million, or 93% of total revenue.
The company's focus on AI-powered advertising tools has played a crucial role in this growth.
In an effort to further expand its advertising capabilities, Reddit launched two new features aimed at enhancing campaign strategies.
Today, we shared our Q2 2025 earnings results, and we have plenty to be proud of and even more to be excited about. A few highlights include:
• Revenue grew 78% year-over-year to $500M
• Our user base expanded to 416M+ WAUq & 110M+ DAUq
• Investments in machine translation… pic.twitter.com/gWNpdGmbxY — Reddit, Inc. (@Reddit) July 31, 2025
Reddit Insights, a tool that uses the platform's vast data of posts and comments, helps advertisers identify trends and gain real-time insights for targeted marketing.
Additionally, Conversation Summary Add-ons enable advertisers to include discussions from Reddit users directly within ads, offering a unique glimpse into public opinions on products or brands.
Alongside advertising, Reddit saw growth in its "other revenue" category, which includes income from its data licensing business, as reported by Tech Crunch.
Deals with AI providers, such as Google and OpenAI, have already been established, further contributing to this growth. The "other revenue" segment jumped 24% year-over-year, reaching $35 million, up from $28.1 million in the same period last year.
Reddit Q2'25: 78% Revenue Growth & 984% Net Income Surge
Reddit $RDDT just posted a blowout Q2.
Revenue grew +77.7% YoY to $499.6M, topping estimates by a wide margin ($426M). More impressive? Net income hit $89.3M, up nearly +10x YoY, with free cash flow of $110.8M — a 22%… pic.twitter.com/gMEXV1lpIf — Sergey (@SergeyCYW) August 1, 2025
One of Reddit's major AI-driven initiatives, the Reddit Answers tool, also experienced impressive growth.
Launched in December, the tool provides users with answers through a conversational interface and now boasts 6 million weekly users, a significant increase from 1 million in the previous quarter.
CEO Steve Huffman noted that the company is working to integrate Reddit Answers into its core search experience, positioning search as a central feature across the platform.
As Reddit continues to leverage AI to improve both its advertising offerings and user experience, the company appears poised for sustained growth, particularly through its content licensing and AI partnerships.
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