Aug 6 (Reuters) - Reddit forecast third-quarter revenue above Wall Street estimates on Tuesday, a sign that a recovering digital ad market would draw new advertisers to the social media platform.
The company said it expects third-quarter revenue to be between $290 million and $310 million, compared with analysts' average estimate of $278.7 million, according to LSEG data.
The results, the company's second after Reddit went
public in March
, follows bigger rival Meta's
upbeat second-quarter revenue
and rosy sales forecast, driven by robust digital-ad spending.
The earnings also fan optimism that Reddit's content licensing deals with Alphabet's
and Microsoft-backed
OpenAI
are paying off despite a fiercely competitive social media market, as it looks to diversify its revenue streams.
Reddit also signed
deals with sports leagues
, including the National Basketball Association and the National Football League in July, to attract a loyal sports audience and in turn create opportunities for advertisers.
The company's daily active unique visitors increased 51%, to 91.2 million, in the second quarter ended June 30. (Reporting by Jaspreet Singh in Bengaluru; Editing by Pooja Desai)