Reddit shares have plunged 35.7% in the year-to-date period, underperforming the broader Zacks Computer & Technology sector's 24.7% increase and the Zacks Internet - Software industry's 10% gain. The dip stems from irregular and declining search referral traffic, especially toward the end of the second quarter of 2026, which caused a slight decrease in daily active users and increasing volatility. Despite the pullback, Reddit reported 130.3 million daily active uniques in the second quarter of 2026, up 18% year over year, and 514.6 million weekly active uniques, up 24% year over year, while international revenues surged 84% year over year to $166.8 million. For the third quarter of 2026, management expects revenues between $860 million and $870 million, representing 47% to 49% year-over-year growth, while the Zacks Consensus Estimate for third-quarter revenues is pegged at $886.35 million, indicating year-over-year growth of 51.54%, and the consensus earnings mark stands at $1.30 per share. Reddit stock carries a Zacks Rank #2 (Buy) and a Growth Score of A, though it trades at a forward 12-month Price/Sales ratio of 6.70X, above the broader Zacks Computer & Technology sector's 6.18X.
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