Reddit reported second-quarter advertising revenue of $762 million on July 30, 2026, a 64% year-over-year increase that outpaced total revenue growth for the eighth straight quarter. Shares fell 12.49% in after-hours trading anyway, to $155.80 from a regular-session close of $178.07, as investors weighed a 6% year-over-year gain in United States daily users against management commentary describing search referral traffic as choppy and volatile late in the quarter.

The advertising numbers

Total revenue reached $804.9 million, up 61% from $499.6 million a year earlier and above the $731 million analyst consensus. Advertising accounted for $762 million of that, with other revenue, the line that carries data licensing, contributing $43 million on 24% growth.

Geographic split matters for media buyers assessing where impression supply is expanding fastest. United States revenue grew 56% to $638.1 million. International revenue grew 84% to $166.8 million. Average revenue per unique rose 36% globally to $6.18, with the US figure at $11.85, up 51%, and international at $2.26, up 31%. That widening gap between domestic and international monetisation reflects an auction that has been priced up faster in the market where Reddit has the deepest advertiser base.

According to Reddit, advertising revenue growth was driven by year-over-year gains in both pricing and impressions. Conversion volume grew more than 100% year-over-year, while click volume grew more than 30%. Click-through rates were up more than 40% year-over-year, according to the shareholder letter. Chief Operating Officer Jen Wong framed the mechanics on the earnings call: "When you look at the volume of conversions growing and clicks growing, what that means for an advertiser is that they're getting more outcomes at equal or better prices. We're just getting more competitive with all the signals, ML work, and optimization work that we're doing."

Advertiser count grew more than 70% year-over-year. Eleven of fifteen industry verticals grew more than 50%, with retail and travel called out as particular areas of strength. Revenue from the scaled channel, which covers mid-market and small business accounts, doubled year-over-year. Rest-of-world revenue grew more than 80%.

Max moves from beta toward default

The automation story is the most consequential product line for practitioners. Reddit Max, the fully automated campaign type that launched in beta on January 5, 2026 with 17% lower cost per action, grew its advertiser base by more than 60% sequentially from the first quarter. Max revenue grew more than 150% over the same period.

Two additions landed in the quarter. The app install objective was added to Max campaigns, extending the app-focused beta announced in May. Tailored creatives arrived alongside it, using AI to identify relevant communities and audiences before generating variants on advertiser-supplied creative.

Named performance results attached to those tools were disclosed on the call. Lenovo achieved 40% higher purchase value running Max than with standard campaigns. Max campaigns for app ads, still in beta, showed an average 15% reduction in cost per action and a 28% increase in results volume in testing. Online pharmacy DocMorris recorded a 20% lower cost per install and scaled spend after seeing a cost per purchase that beat benchmarks by more than 70%.

The strategic direction is explicit. According to Reddit, Max will expand to a broader range of advertisers and become the primary onboarding experience for small and medium businesses. That mirrors the trajectory automation has followed on larger platforms, where the automated product eventually becomes the default rather than the alternative. Reddit's 2026 creative best practices study, published in May from an analysis of nearly 150,000 in-feed ads, sits directly upstream of that shift: when targeting and bidding move inside the system, creative quality becomes the remaining lever advertisers control.

Video and the six-second objective

Video views was the fastest-growing upper-funnel objective, with revenue more than doubling year-over-year. The six-second engaged video view goal, generally available since January, delivered more than a 130% lift in six-second view-through rate in testing, more than a 70% increase in video completion rate, and an 80% reduction in cost per six-second video view with auto-bidding.

Video in comments launched during the quarter and already accounts for more than 10% of video posts on the platform, according to Reddit. Executives said work is underway on how video appears in the home feed, alongside an experiment in background listening to posts, both of which would expand video inventory rather than merely improve its performance.

Shopping, measurement and the API layer

An alpha test of shopping listing ads began in the quarter. The format is a multi-advertiser product carousel that matches product catalogues to high-intent shopping conversations, which Reddit says are growing 40% year-over-year on the platform. It extends beyond the single-advertiser catalogue ads that Dynamic Product Ads have supported since 2025, and follows the AI shopping tools shown at Cannes in June.

The Shopify integration moved to general availability in May after an alpha first shown at Shoptalk in March. More than 500 accounts are now integrated. Reddit reported a Shopify advertiser activation rate more than twice that of standard Ads Manager onboarding.

Dual attribution entered beta for app install advertisers, combining first-party attribution signals with existing mobile measurement partner data. That capability sits alongside the Anonym partnership announced in April, which handles conversion lift measurement without first-party data leaving the advertiser.

Third-party validation figures were disclosed for two studies. Research from Attain and Circana found Reddit delivered 1.5 times higher return on ad spend for consumer packaged goods advertisers than other social platforms on average across the United States and Western Europe. TransUnion identified Reddit as the most efficient paid social channel in EMEA for retail advertisers, with an average seven times higher return on ad spend and 13% of Reddit's impact lifting other marketing channels.

On the infrastructure side, Ads API revenue grew more than 40% sequentially, and more than half of total revenue now comes from credit line relationships rather than card-billed accounts. That shift matters for agency planning cycles: credit lines are the mechanism through which always-on budgets get committed in advance.

Search referrals and the user question

The market reaction did not follow the revenue line. Global daily active uniques averaged 130.3 million, up 18%, and weekly active uniques crossed half a billion at 514.6 million, up 24%. United States daily uniques grew 6% to 53.2 million against a stated target of 100 million. Logged-in daily uniques globally grew 7% to 52.6 million, while logged-out grew 27% to 77.7 million.

Chief Executive Steve Huffman attributed the daily user shortfall to referral declines offsetting product gains. "We're not building for drive-by traffic. We're building a daily destination," he said on the call. He also described the causes as partly opaque: one identified factor was a decline in machine-translated content, which contributed to volatility on the international side.

Asked directly about the mechanism, Huffman drew a comparison that will resonate with any publisher tracking the same trend. "From where we sit, AI Overviews has yet to make a similar level of positive impact, and I think that's consistent across the broader landscape, us, businesses, publishers, retailers. We're still looking for that win-win."

That assessment aligns with independent measurement PPC Land has tracked. Ahrefs research published in February 2026 found AI Overviews correlate with a 58% reduction in click-through rates for top-ranking pages, while a randomized study released in June found a 39.8% cut in outbound organic clicks with no measurable improvement in user satisfaction.

Reddit's position in that ecosystem is distinctive because it is both a beneficiary and a supplier. Reports in July placed Reddit among the publishers weighing whether to continue supplying content to Google as search referrals fall. Huffman addressed the renewal question without committing to an outcome, saying the relationship with Google predates the formal licensing agreement and spans ten blue links, AI Overviews placement and training use, with each treated as an independent decision. Asked whether buyers exist beyond Google and OpenAI, he said the market is expanding across different use cases and scales.

For advertisers, the operative claim was blunter. "The direct users, the app users are worth multiples more than the search referral traffic," Huffman said. New app user retention rose 50% year-over-year on a relative basis, from what management repeatedly described as a small base.

Margins, buybacks and a reporting change

Adjusted EBITDA reached $342.8 million at a 42.6% margin, up 106% year-over-year. Net income was $252.8 million, up 183%, producing diluted earnings per share of $1.25 against $0.45 a year earlier. Gross margin was 91.3%, up 50 basis points. Operating cash flow was $261.9 million and capital expenditure was $1.1 million, roughly 0.1% of revenue.

Chief Financial Officer Drew Vollero flagged a headcount efficiency threshold: "We crossed $1 million of revenue per head count on an LTM basis for the first time." About 100 people were added during the quarter. Stock-based compensation and related taxes were $106.8 million, or 13.3% of revenue, and the full-year guide was lowered from the high teens to the low-to-mid teens as a percentage of revenue. Third-quarter stock compensation is expected to rise to between $140 million and $155 million as older grants vest and are replaced at higher share prices.

Reddit repurchased 1.5 million Class A shares for $235 million at an average price of $157.57, leaving roughly $760 million on the authorisation announced alongside fourth-quarter 2025 results in February. Cash, equivalents and marketable securities stood at $2.8 billion as of June 30, 2026.

Third-quarter guidance calls for revenue between $860 million and $870 million, or 47% to 49% growth, with adjusted EBITDA between $385 million and $395 million. The midpoint implies a deceleration from 61% in the second quarter and from the 74% advertising growth reported for the first quarter.

One disclosure change carries practical weight for anyone modelling Reddit's addressable inventory. The second quarter was the last in which logged-in and logged-out daily active uniques will be reported separately. From the third quarter, only total United States and international daily and weekly active uniques will be disclosed. The distinction being retired is precisely the one that separates the search-referred audience from the direct audience, and it disappears in the quarter when that separation became the central investor question.

Why this matters for advertisers

The quarter documents a platform whose commercial machinery is compounding faster than its audience. Advertiser count up more than 70%, scaled channel revenue doubled, and per-user monetisation up 36% describe a marketplace where demand is thickening against inventory that is growing more slowly in the market with the highest prices. Auction density rises. So do costs, eventually.

Wong was asked directly whether ARPU headroom remains. "I think we still have a lot of ARPU headroom because I look at our roadmap, I see lots of ways that we can continue to deliver value for our advertising partners, i.e., more outcomes at more competitive prices," she said. The named lever was the six-second guaranteed video view.

Search advertising remains unbuilt. Executives said search enrichment with product visuals from catalogues has been tested in consumer electronics and expanded to further categories, with advertising to follow. "That's a space that we're eyeing. We clearly have the capability to do it," Wong said. A shopping listing ads module on a search page would represent Reddit's first meaningful intent-capture surface, distinct from the feed placements that carry the business today.

The referral question cuts both ways for buyers. A logged-out visitor arriving from a search engine is monetisable inventory. If that traffic keeps declining while direct app usage grows, the audience composition shifts toward users the platform values more and advertisers reach through the same auction, but total impression supply grows more slowly than the demand curve suggests. That is the arithmetic behind a 12.49% after-hours decline following a $74 million revenue beat. The brand campaign launched with Mischief in June is aimed at the same problem from the consumer side, and Vollero was explicit about the constraint on spending more to solve it: "The key unlocker there is we just need better user retention."

Timeline

Summary

Who: Reddit, Inc. (NYSE: RDDT), reporting through Co-Founder and Chief Executive Steve Huffman, Chief Operating Officer Jen Wong and Chief Financial Officer Drew Vollero, with commentary directed at advertisers, agencies and investors.

What: Second-quarter 2026 results showing total revenue of $804.9 million, up 61% year-over-year, and advertising revenue of $762 million, up 64%. Advertiser count grew more than 70%, scaled channel revenue doubled, conversion volume grew more than 100% and Reddit Max revenue grew more than 150% sequentially. Shares fell 12.49% in after-hours trading to $155.80 despite a $74 million revenue beat, as United States daily uniques grew only 6% and management described search referrals as choppy and volatile late in the quarter.

When: Results were released on July 30, 2026, covering the quarter ended June 30, 2026, with the earnings call held the same day at 1:30 p.m. PT. Third-quarter guidance of $860 million to $870 million implies 47% to 49% growth.

Where: Reddit is headquartered in San Francisco, California. United States revenue reached $638.1 million and international revenue $166.8 million, with rest-of-world revenue growing more than 80%.

Why: The quarter separates two trajectories that had previously moved together. Advertising demand, automation adoption and per-user monetisation are compounding, while audience growth in the highest-priced market has slowed and the search referral channel that supplied logged-out inventory has become unpredictable. From the third quarter, Reddit will stop reporting logged-in and logged-out user metrics separately, removing the disclosure that made that divergence measurable from outside the company.