Reddit aced Wall Street’s scorecard, but the stock extended the losses

Reddit (NYSE:RDDT) stock extended Tuesday’s losses in the ‘afterhours’, losing another 5% or so, despite the social media firm beating expectations in practically all meaningful metrics.

And on the stock market scorecards Reddit outperformed what Wall Street had expected, albeit it remained loss making and some investors are keen to see progress in that direction.

A recent team up with major sports leagues, and its tie-up with OpenAI are also recent highlights.

Meanwhile, Tuesday's earnings were only Reddit’s second set of financials since its $34 per share March IPO that valued the business at around $6.5 billion.

Some investors and traders will also be aware of the looming end of ‘lock ups’ (due in the coming weeks) following on from the IPO, which once lapsed will enable insider shareholders to sell stock for the first time since this year’s float.

Tuesday's earnings report

Reddit reported $281.2 million of second quarter earnings beating a Wall Street forecast of $254 million. At $10.1 million, Reddit’s net loss narrowed significantly a year-over-year comparative of $41.1 million, and, on a per share basis that loss reduced to 6 cents from 70 cents.

In terms of users, Reddit confirmed continuing traction – with the tally for daily active users amounting to 91.2 million, versus a prediction of just over 84 million.

Ad revenue totalled $251.1 million marking a 41% year-over-year improvement, while its nascent data licensing revenue stream showed a 691% increase to $28.1 million.

Guidance for the third quarter pitched revenue between $290 million and $310 million,  which will have pleased Wall Street analysts that previously pencilled in a prediction of $282 million.

Nevertheless, in afterhours deals Reddit stock gave up another $2.36 or 4.34% to $54.36 – adding to an earlier 4.3% loss in the regular trading day.