Reddit (NYSE:RDDT) just delivered the kind of quarter Wall Street couldn't ignore. Revenue for Q1 surged 61% to $392.4 million, well above expectations, while profit per share hit 13 cents a sharp beat for a company still early in its public journey. Daily active users climbed 31% to 108.1 million, and the platform saw a 50%+ jump in active advertisers. That momentum is carrying over into Q2, with Reddit guiding revenue between $410 million and $430 million, compared to consensus estimates of $395.5 million. For a business often underestimated against the giants, this was a breakout moment in pure numbers.

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Still, not everything was celebratory. CEO Steve Huffman cautioned that changes to Google's search ecosystem are already impacting traffic, and more disruption could be ahead. Reddit's unique strength lies in its ability to monetize its highly engaged communities through ad placements inside subreddit discussionsoffering advertisers context and intent they struggle to find elsewhere. While rivals like Snap are backing away from forward guidance amid economic uncertainty, Reddit is leaning in, projecting adjusted EBITDA between $110 million and $130 million, ahead of the $105.3 million consensus. That signals a maturing business with growing operating leverage.

Fundamentally, Reddit is proving it can do two hard things at once: grow its user base and scale monetization. The company's investment in AI to boost product engagement is starting to pay dividends, helping it stand out in a crowded ad tech market. With big platforms like Meta (NASDAQ:META) already commanding premium ad dollars, Reddit's growing slice of the pie reflects both its differentiated model and improving execution.