u/Accomplished-Exit822

*Mods pls don’t delete, I have googled and searched on Reddit and I see no thread*

Flight shows 25/28 booked and 15 are checked in for business right now.

There are 7 passengers on the e-upgrade list. I’m near the bottom.

I’ve already checked in for the flight and it takes off in 8 hours.

Should I cancel my eup waitlist in hopes of getting offered an LMU? I’ve already checked in though, will it still show up?

I called AC and they said LMU’s don’t show if you submitted and Eup.

Multi-trillion $ companies are too cheap to throw a few hundred million Reddit’s way when so much of their utility depends on Reddit’s content:

https://www.einnews.com/pr\_news/946437452/ai-cites-reddit-more-than-any-other-site-when-australians-ask-what-to-buy-findrix-study-finds

I’ve been to north of 40 Rolex stores around the world over the past few years. Almost uniformly, the sales agents are idle as there is nothing to sell except for unpopular items like cuff links.

What do you do all day? It seems like the most boring, mind-numbing job in the world. Every so often, a customer will walk in and you have to repeat “we have nothing available for sale”. Doesn’t it get aggravating after the nth time?

Let me start this with a caveat: when the most loyal investors bail, it’s usually the bottom.

I’ve held RDDT stock for a long time and recently sold all my holdings, as I briefly mentioned a few weeks ago. 

Although revenue and free cash flow growth is phenomenal and management is doing an incredible job with capex, margins, and overall discipline, I feel that the factors below outweigh, at least in the near  term, this performance:

1. The Google deal. With it, the fresh-Reddit-data-is-valuable thesis is solidified when the gorilla in the industry validates it. The more others sign on (OpenAI et al) the more concrete the thesis becomes.  Without it though, the market values Reddit solely on its ad platform, resulting in a lower multiple. Further, any hint of a war with Google (Google pushing Reddit links to page 2 for example) would be devastating for the stock. If you look at the growth of Reddit over the past several years, it directly correlates with Google pushing Reddit results. 

2. Even with a Google deal, AIO/LLM’s are a real problem. I find myself using them more and more and directly bypassing Reddit. Same goes for the LLM’s, the better they get, the less incentive there is for a casual user to go directly to the forum. 

3. Regulations, such as limiting the age or also how much content a user can view, are another threat. Meta recently settled a case, but there are more pending across the industry. Regulators, rightly so, want to limit the power of these platforms, as well as their addictive qualities. This will only be rising over the years to come as backlash intensifies against Big Tech, and this will affect even smaller platforms such as Reddit. 

4. Limits of the platform. Reddit feels like 
   Twitter. It’s primarily text-based, has a loyal group of hardcore users, but it’s hard to commercialize on a large scale. Video-based apps like Instagram and Tik Tok are just far more valuable to advertisers since it’s easier to convert. Think about how many more ads you click on IG vs Reddit, there is no comparison. Also, I don’t feel Reddit has innovated enough over the years.

5. US DAU. The stagnation is real, not just in user numbers, but in time spent on the site. They have yet to show how they’re going to reverse this.

6. Insider selling. Some may think it’s not relevant, but it rubs me the wrong way to see this incessant selling, even after they’ve sold so much and the stock is down more than 50% from its highs. Sorry, but I’ve been investing for decades and I’ve had really bad experiences when management always sells and never buys on the open market.

Would love for someone to challenge my ideas as I do like the site and want to fall back in love with the stock.

Many SaaS names had management step up and buy shares this year.

Many energy names had management step up and buy during COVID and tariffs.

Management has never bought any shares. With the stock down almost 50% from highs and also having gone nowhere in the last few years, management needs to show confidence in their forecasts about how rosy things are and will be.

There is only one way to do that: Buy Shares with their OWN money.

As my post earlier today had said, RDDT is an expensive stock, and any negative metric (in this case, US DAUq) would tank the stock in today’s punishing market.

Rich Greenfield asked the most pertinent question on the call; he stuck his finger RIGHT on the sore spot, and Steve unfortunately swung and missed when answering it. The stock immediately started plunging once again and the losses doubled.

As us ol’ time bag holders know, RDDT’s most watched metric is US DAU. Why? It’s because US users are the most valuable, so any deceleration will affect every metric (arpu, EPS, margins, etc…). Basically, if your best customer starts coming around less, you’re going to feel it sooner or later.

What Steve SHOULD have said is what he said at the end of the call, when the Oppenheimer analyst brought it up again and laid it up nicely in his lap. Essentially, the drive-by user coming through a Google search has little value and he should have used an analogy of a window shopper vs an actual transacting customer.

I feel that when management hems and haws and doesn’t make it crystal clear, the Street shoots first and asks questions later.

AIO and Google’s demotion of machine-translated Reddit content are what is hurting traffic now. They need to just keep reiterating how unimportant that traffic is and focus on how they’re increasing ARPU, which supports their position on the Google traffic being less valuable.

It was really frustrating to hear this call because they did so well in all other areas. Part of me is annoyed at management, but part is also annoyed at Google for being such a dick and screwing around with their algo so goddamn much that there is no stability.

I’ve invested in hundreds of companies over the years, and I feel that Reddit Inc ranks near the top in terms of respect they show to their shareholders.

Many companies completely ignore their retail shareholder base, and others try to manipulate them (never invested in these, but AMC & GME come to mind).

I’ve only had ONE CEO respond to my emails or messages in the past when I’ve written to them out of the blue, and that company did fantastically well and eventually got bought out. Spez is the only other CEO that has answered multiple questions of mine directly.

With Reddit, the IPO set aside 8% of shares for its users, management not only take our questions on the quarterly conference calls, but they respond to the rest of them in the corresponding Reddit thread. Aside from that, Spez clearly checks in to the Reddit stock subreddit, even though he must be really busy running the company (and working out).

Little things like the hoodie are meaningful to shareholders as it shows that management is actually listening to and participating with other shareholders.

Great job management, we appreciate you!

We know that Reddit has been in talks with Google and OpenAI for many months now in regards to next year’s renewals.

Steve and Jen have naturally been very tight-lipped about it, other than saying that all parties recognize the value of Reddit’s data, as well as the fact that Reddit is looking for more than just cash.

Clearly, the deals in place undervalue Reddit’s data, and the market is looking for substantially more (many multiples) come renewal time.

The fact that talks are still ongoing shows me that hardball is being played, likely by all sides.

A lot of businesses, Google included, look at LLM’s as potentially existential threats. They’re spending hundreds of billions to build capabilities into their own, so why not throw a few hundred million a year Reddit’s way as well and quickly sign a deal. It seems that the risk/reward would be favorable for them.

Alternatively, maybe Reddit’s data is not as valuable as we think and they don’t want to pay up.

Thoughts?

A significant amount of comp is in RSU’s and the stock keeps tanking because of AI fears.

Any concerns about the stock, or is the market overreacting to AI unknowns?

Filed about 2 months ago, and like the title says, the status still shows as “Accepted”.

Anyone else in this situation? Shouldn’t the status have changed by now?

The Specs launch was an epic failure as it mainly focused on a grinning Evan sporting a pair of clunky, geeky-looking glasses.

The entire internet ridiculed him and his Specs, which must be pretty humiliating for him and the team that worked on them.

My question is: why did Snap not show what the world looks like when you actually wear the damn things?? Why didn’t they show some apps, especially a killer app? Is it because the apps aren’t very good? If so, why launch the product now?

Seems like a massive marketing failure to me.