(MT Newswires) -- Reddit, the social network known for its alien logo, is considering an initial public offering (IPO). Initially, the company was targeting a valuation of $15bn in early 2022, but estimates have been revised downwards, with the latest valuations placing Reddit's valuation at around $5bn. In an online advertising market dominated by giants such as TikTok and Meta, Reddit made over $800m in advertising revenues the previous year, up 20% on the year before. Although it has not yet reached profitability.
Investors are paying close attention to Reddit's profitability and its potential to emulate the success of other recently floated tech companies. Reddit's next half-yearly report will be scrutinised for details of its financial strategy and the potential impact of artificial intelligence on its valuation. Reddit's IPO could also act as a catalyst for other private companies looking for the right time to go public.
One question remains: will Reddit become the next meme stock phenomenon driven by its own users? Only time will tell.
