u/Really0riginal

The S&P inclusion is a net benefit, the latest quarter was above expectations.

The leadership team is focused on DAU and more catalysts are coming up in the pipeline.

I am ready to buy more if it goes to the 140s / 130s.

The long term trajectory of the business is still going in the right direction, it's normal to see a high growth company and a social media one be volatile.

Especially since the alpha is where there is uncertainty of future cash flows - growth.

NFA 20% of my port is in RDDT stock no options

My tldr perspective as a product manager: Lower price action on the stock is a near term overreaction on the US DAU, which can scare some investors in term of the TAM and long term FCF - value.

The good news is that it’s a concern for the leadership team - as per Steve Huffman honest response during the Cnbc interview.

Revenue growth higher than expected 60%+ still shows RDDT as a key partner that increases revenue for their customers with great ROAS(return on advertising spend)/ ROI - halo effect. It also shows engagement overall increasing nicely 500 M weekly which is impressive.

If the social media is full of bots you get a lower ROAS, every strategy they do to manage bots/AI content helps those ratios which then accelerate the spend on the platform. Some other platforms are getting full of bots it will decrease their ROAS

They have been ramping up their sales team / marketing team to capture more ad budget to better sell the story of the lower funnel efficiency. This is why ad agencies have been recommending RDDT the ratios make sense. This was the best short term strategy.

They are still laser focused on the right strategy = better App experience which will lead to better user retention.

A suggestion: I have seen multiple comments from X / YouTube where users can’t post or get filtered by reddit filters before posting. This leads to users to completely abandon the platform. This could be a key reason why US has been seeing slower growth. An appeal system - human verification transparency checkpoint would significantly help in my opinion.

Rddt is 20% of my port, I will add more if it gets into the way too cheap territory of 120s.

At some point the numbers will matter to the market. Right now it’s the explosive growth for AI datacenter.

This is exactly how the MMs get you, to fold.

Yes there is cost opportunity in any stocks / investments.

Zuck - Forum may be a competitor - we will see in time.

We are in a consolidation phase where the 1 Year is still 40%+.

My last purchases was at $127 and I will add it more if it reaches overreaction - low 130s

Either way enjoy the weekend, you are invested in an abnormal company with very high growth / FCF margins that are increasing and a strategy that makes sense with a high TAM.

In the current market if you can put the numbers in a spreadsheet it’s being pumped less than companies that you have a big unknown attached to it : The AI Buildout

Don’t worry about short term price movement, RDDT is still an excellent company with a exceptional business MOAT and Growth

RDDT is still in the growth sphere of valuation and the big money is trying to find 3-5x very short term

I still believe RDDT can 3x within 1-2 years

Top 3 key takeaways -

1- Revenue came up at 69% - A lot higher than my expectations at 60%+. They guided for low 40s for Q2 we will probably see over 50%+

Which is higher than wall street was initially expecting - a rerating should happen.

2- Management of the bot issue is a real focus for the team, this is great knowing some other platforms are getting swamped with it.

3- The Strategy is on Track

A- Build Ad credibility to become a great alternative to Meta and even lead with their end of the funnel opportunity (recent hiring is focused on that)

B- Improve the feed (ML specialist - talent from other social media companies help as well)

C- Improving DAU by facilitating logged in experience and building on international growth. shows the app appeal and will help in securing bigger ad spenders

The team seem very confident in their approach and I am glad that they are owning their financial performance.

Buy backs used was only 0.5% and Data licensing are bonuses on top.

Still possible to hit $500+ before EOY with politics ads and macro improving.

It’s a FCF machine and this will help them make big moves moving forward.

Edit : changed 5% buybacks to 0.5%