Reddit’s first-quarter 2025 earnings report shows strong growth in traffic and user engagement, particularly among logged-out users. Although the announcement and shareholder letter did not mention search engines or the temporary decrease in traffic in February, the increase in logged-out traffic suggests year-over-year growth from external referrals from search engines and social media.
The shareholder letter indirectly referenced search traffic:
“For seekers, Reddit’s open nature is essential—it allows our content to surface across the open web and be easily found in search. We remain one of the last major platforms that doesn’t require you to sign in to learn something because we believe that by giving everyone access to knowledge, we are helping fulfill the purpose of the internet. This openness broadens visibility, drives awareness, and brings us new users— but it also means that some of our traffic from external sources is variable. “
TL/DR
- Over 400 million people visit Reddit weekly, and total revenue reached $392.4 million for the quarter, representing a 61% year-over-year increase.
- More users are logged-in, improving Reddit’s value for ad targeting and audience engagement, which is good news for digital marketers.
- Growth in logged-out users suggests increased external referrals from search and social, a trend that may concern publishers and SEOs
Platform Growth and User Activity: Daily Active Unique Visitors
Reddit refers to their daily active uniques as DAUq. The Reddit quarterly report defines Daily Active Uniques (DAUq) as:
“We define a daily active unique (“DAUq”) as a user whom we can identify with a unique identifier who has visited a page on the Reddit website, www.reddit.com, or opened a Reddit application at least once during a 24-hour period.”
Reddit reported 108.1 million Daily Active Uniques (DAUq), a 31% increase compared to the same quarter last year. Weekly Active Uniques (WAUq) reached 401.3 million globally, also up 31% year-over-year.
Daily Active Uniques: U.S. Versus International
Daily Active Uniques for both U.S. and International saw significant increases compared to the same period last year, with international visits post nearly double the gains for the United States.
- U.S. DAUq was 50.1 million, up 21%,
- International DAUq rose to 58.0 million, up 41%.
This contrast highlights that Reddit’s fastest user growth is occurring outside the U.S., signaling expanding global reach and rising visibility in international markets. This trend may indicate growing discovery opportunities through non-U.S. referral sources and increased relevance in regions where Reddit has historically had lower reach.
Logged-in Daily Active Uniques
Logged-in users can comment, moderate, start discussions, and vote. A bottom line significance is that being logged-in allows for better behavioral tracking and a higher ad targeting value. Thus, logged-in users are an important metric of the viability of the Reddit community.
Logged-in Daily Active Uniques (DAUq) were up in both the U.S. and internationally, with international growth outpacing the U.S. on a year-over-year basis:
- Logged-in U.S. DAUq: 23.0 million (up 19% year-over-year)
- Logged-in International DAUq: 25.8 million (up 27% year-over-year)
Logged-Out Daily Active Uniques (DAUq)
The rise in overall Daily Active Uniques (DAUq) extended to logged-out users, with that segment experiencing strong year-over-year growth. This suggests that Reddit continues to be a popular destination for reading opinions and reviews from real people. It may also suggest that search engines and social media are sending more visitors to Reddit, as those users are more likely to arrive via external referrals, although the quarterly report did not mention search traffic or referral sources.
Logged-out users increased in both the U.S. and internationally, with international growth more than double that of the United States.
- Logged-out U.S. DAUq: 27.1 million (up 22% YoY)
- Logged-out International DAUq: 32.2 million (up 54% YoY)
Revenue and Monetization
Reddit’s total revenue reached $392.4 million, an increase of 61% compared to Q1 2024. Advertising revenue accounted for $358.6 million, also up 61%. Other revenue totaled $33.7 million, a 66% increase year-over-year.
Average Revenue Per Unique (ARPU) also increased:
- U.S. ARPU: $6.27, up 31%
- International ARPU: $1.34, up 22%
These increases in Average Revenue Per Unique (ARPU) suggest that Reddit is improving its monetization of user activity.
It also reported $115.3 million in adjusted EBITDA. EBITDA stands for earnings before interest, taxes, depreciation, and amortization. The adjusted version excludes certain non-recurring or non-cash expenses. This figure is often used to show how profitable a business is from its core operations.
- Net income: $26.2 million
- Adjusted EBITDA: $115.3 million
- Operating cash flow: $127.6 million
- Free Cash Flow: $126.6 million
- Gross margin: 90.5%
Takeaways
Platform Usage Growth
- Total Daily Active Uniques (DAUq) rose 31% year-over-year to 108.1 million.
- Weekly Active Uniques reached 401.3 million globally, also up 31%.
- Growth among international users (41%) outpaced U.S. growth (21%).
- Logged-out users grew faster than logged-in users, especially internationally (+54% YoY).
Logged-In vs. Logged-Out Behavior
- Logged-in users are critical for Reddit’s ad targeting and engagement features.
- Logged-in DAUq rose in both U.S. (+19%) and international (+27%) markets.
- Logged-out DAUq showed steeper growth: +22% U.S. and +54% internationally.
- The rise in logged-out traffic suggests Reddit may be benefiting from increased exposure via search engines and social media, despite the report not directly mentioning search.
Revenue and Monetization
- Total revenue grew 61% YoY to $392.4 million.
- Advertising revenue: $358.6 million, also up 61%.
- Other revenue grew 66% to $33.7 million.
ARPU (Average Revenue Per Unique)
- U.S. ARPU: $6.27 (up 31%)
- International ARPU: $1.34 (up 22%)
- ARPU growth suggests improved monetization per user, especially through ad impressions in international markets.
Profitability and Financial Health
- Net income: $26.2 million
- Adjusted EBITDA: $115.3 million
(Reflects earnings before interest, taxes, depreciation, and amortization, excluding non-cash or one-time costs) - Operating cash flow: $127.6 million
- Free Cash Flow: $126.6 million
- Gross margin: 90.5%
Reddit’s Q1 2025 earnings report highlights strong year-over-year growth in both logged-in and logged-out user activity, with usage rising significantly in the U.S. and even higher internationally. The company also reported a 61% increase in total revenue and positive cash flow, showing that Reddit is becoming more effective at monetizing its growing user base, which is useful information for digital marketers.
The report reflects growth in usage, revenue, and Average Revenue Per Unique (ARPU). Reddit’s expanding reach and monetization suggest it remains a relevant platform for users and remains a destination for referral traffic.
Featured Image by Shutterstock/gguy
