Reddit's AI-Driven Revenue Surge

Reddit's Q2 earnings for 2025 reveal a significant revenue increase, driven by its strategic focus on AI and advertising. The platform reported a 78% year-over-year revenue growth, reaching $500 million, exceeding expectations. This surge is attributed to AI-enhanced ad personalisation and increased user engagement. Daily active unique users (DAUq) rose to 110.4 million, a 21% increase.

Advertising revenue accounted for $465 million, representing 93% of the total revenue, marking an 84% year-over-year increase. The platform's AI-driven tools enable advertisers to leverage viral posts for campaigns and insert contextually relevant ads into user conversations, boosting click-through rates and ROI. Reddit's global average revenue per user (ARPU) climbed to $4.53, a 47% increase.

Looking ahead, Reddit anticipates Q3 revenue between $535 million and $545 million. The company's focus remains on improving the core product experience, developing search capabilities, and expanding internationally. International expansion, particularly in France, Spain, and Brazil, has driven user growth.