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Reddit's 50% Stock-Price Plunge Fails to Entice Buyers as Growth Slows (yahoo.com) 37

Though it's stock price is still up 200% from its IPO in March of 2024 — last week Reddit's stock had dropped nearly 50% since February 7th.

And then this week, it dropped another 10%, reports Bloomberg, citing both the phenomenon of "volatile technology stocks under pressure" — but also specifically "the gloomy sentiment around Reddit..." The social media platform has struggled to recover since an earnings report in February showed that it is failing to keep up with larger digital advertising peers such as Meta Platforms Inc. and Alphabet Inc.'s Google, which have higher user figures. Reddit's outlook seemed precarious because its U.S. traffic took a hit from a change in Google's search algorithm.

In recent weeks, the short interest in Reddit — a proxy for the volume of bets against the company — has ticked up, and forecasts for the company's share price have fallen. One analyst opened coverage of Reddit this month with a recommendation that investors sell the shares, in part due to the company's heavy reliance on Google. Reddit shares fell more than 5% in intraday trading Friday. "It's been super overvalued," Bob Lang, founder and chief options analyst at Explosive Options said of Reddit. "Their growth rate is very strong, but they still are not making any money." Reddit had a GAAP earnings per share loss of $3.33 in 2024, but reported two consecutive quarters of positive GAAP EPS in the second half of the year...

At its February peak, Reddit's stock had risen over 500% from the $34 initial public offering price last March. Some of the enthusiasm was due to a series of deals in which Reddit was paid to allow its content to be used for training artificial intelligence models. More recently, though, there have been questions about the long-term growth prospects for the artificial intelligence industry.

"On Wall Street, the average price target from analysts has fallen to about $195 from $207 a month ago," the article points out. "That still offers a roughly $85 upside from where shares closed following Thursday's 8% slump..."

Meanwhile Reuters reported that more than 33,000 U.S. Reddit users experienced disruptions on Thursday according to Downdetector.com. "A Reddit spokesperson said the outage was due to a bug in a recent update, which has now been fixed."

Reddit's 50% Stock-Price Plunge Fails to Entice Buyers as Growth Slows

Comments Filter:
  • by rsilvergun ( 571051 ) on Saturday March 29, 2025 @08:38PM (#65268901)
    Reddit's initial high valuation was on the premise that they would sell their user data and posts to train AI. But it's become stupidly obvious that hey I companies don't have to pay a dime for the content they consume. That's something that only gets done by plebs like you and me.
    • by Anonymous Coward

      Hey, you forgot about mentioning "pump and dump"!

      You are a non-functional autistic and you keep on posting the same things in loops and some sick people abuse and manipulate you by encouraging you to keep on doing that because it fits their crazy extreme-leftist narrative even if the you very rarely makes any sense in your posts and just keeps on exposing your mental problems. What a shame such people are, manipulating mentally deficient patients! Disgusting! They should be ashamed of themselves!

      references:

    • training AI on random unfiltered reddit Data is perhaps some of the LEAST valuable sources of information on the web. The idea that they thought it was valuable is laughable.
      • Crap is readily available and free, so that's what "AI" will be trained on.

        The idea that something like this can attract hundreds of billions in "investment" is laughable, yet here we are. It does.

        People like crap.

        • I think people are starting to realise Reddit was never worth what the business claimed. The profits have been miniscule when there have been any and they are still far outweighed by the loses.
          • by DarkOx ( 621550 )

            Reddit is not worth much to anyone who understands it because it real business model is one that is not hard to reproduce for some VC guys (so will be) and at best is going to generate a rather boring steady revenue stream.

            People don't pay for stuff on the web unless you beat them over the head practically take their wallet. Its just online culture. The best you can do with reddit is show ads, and people will climb mountains just to block them. If you do draconian things with the API the users revolt.

            The

  • by Anonymous Coward

    Reddit's toxic management disables subs whenever Musk complains.

    No wonder people are leaving.

    Mouthpiece of King Donnie.

  • Nature abhors a vacuum.

  • by hdyoung ( 5182939 ) on Saturday March 29, 2025 @09:10PM (#65268967)
    And that’s about it. The concept has been around since the 1960s, and not much has changed when you take a really honest look at it. Any company that bases it’s core business around chatrooms will be perpetually in danger of being replaced because the product is so easy and simple. Lookin’ at you, Facebook/Meta and Twitter/X. They change their name every so often to make it feel “new”.
    • The product is easy. Getting a large userbase is not, and that's what allows the juggernauts to hold their own against newcomers.

      I used to run a forum that had about 3,000 monthly visitors. Once social media became a thing, my audience went down to... less than 10. My forum is still up, but it is a ghost town.

      Nobody cares about quality or socialization. It's all about the numbers. I think the only reason why people might abandon an existing large social media platform is when they finally realize all t

  • You know, Crash-Down-Day for stocks.
  • It's Reddit FFS (Score:4, Insightful)

    by nehumanuscrede ( 624750 ) on Saturday March 29, 2025 @09:25PM (#65268993)

    Before committing any funding to that stock, it would be wise to at least visit the site and get a feel
    for what it really is first. Doing so would probably turn away at least 50% of potential investors.

    I wouldn't invest YOUR money in Reddit even if you gave it to me for free.

    • Re:It's Reddit FFS (Score:4, Interesting)

      by hambone142 ( 2551854 ) on Saturday March 29, 2025 @09:55PM (#65269015)

      Reddit is like drinking alcohol.
      We know it's bad for us. It sort of seems "fun" at the time but later, we regret being near it.

      • It's so toxic and insufferable I'm hesitant to go there just to get technical info or even super-clinical non-political information. It's like trying to stay clean on the subway. There isn't really going to be any clean way to get in and out short of a space suit. Absolutely everything is bookend'd with some kind of politics-oriented sniping or bias. I wonder if this is what it was like in Europe during the Reformation. Like, did Catholics and Protestants just talk mad shit non-stop and lick shots at each
      • As an alcoholic who has gotten 6+ months sober several time, Reddit was weirder to quit. Both were to shut my brain up, but reddit was just so much easier to count every one of my mind slips because of the amount of times I hit my own block page in one day. So many times I would try to go to reddit, get the block screen, remember, then start typing "reddit" in the address bar again and getting the same block page just a few seconds later. I'd sometimes do it 3 times! Any hint of boredom and "r e" then the e
    • Reddit committed suicide at least a decade ago. Now it's worth about as much as /.
  • ...he'll give Reddit billions

    • He'll run a sweepstakes for billions and invite reddit, but the prize will go to a predetermined Musk-lackey and reddit will wind up with nothing but sore lips.
  • Occasionally when I'm doing a search for something then Reddit pops up. About the only time I read something or use it.
  • keeping app (Score:4, Insightful)

    by aRTeeNLCH ( 6256058 ) on Sunday March 30, 2025 @08:52AM (#65269617)
    I uninstalled LinkedIn as I got depressed seeing my colleague post their job change and promotion.

    I uninstalled instagram as I got depressed seeing my friends travel and enjoy their lives.

    But I'll never uninstall reddit because you guys are more miserable than me .

  • I had a reddit account for many years without any issues. I made one comment about smiling while scrolling past Elon Musks obituary. Reddit permanently banned my account, claiming I was "advocating violence". I appealed to no avail. I can't even create a new account, even with a different email, it gets banned within a few minutes. But, I discovered I really don't need reddit anymore, so that's a plus.
  • He can't complain when his face is all sticky.
  • How could anyone view Reddit stock as a worthy investment? A place where people use ad blockers and take offense to the ads that sneak through will never buy those products. Stock in social media is a scam to rip off the gamblers at the wall street casino, nothing more.
  • Reddit's Stock plummets, and nothing of value was lost..
  • I hope that now Elon Musk will step in and buy it to get rid of some of the idiotic policies that are in place.

    LK

If A = B and B = C, then A = C, except where void or prohibited by law. -- Roy Santoro

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