In its IPO filing, Reddit positioned itself as a key player in the AI boom, describing its content as a crucial part of training large language models. The company has also struck a licensing deal with Google to make its data available for the search giant's AI models for $60 million a year. Reddit plans to list 22 million shares, priced at $31 to $34, with an opportunity for its users to purchase shares alongside institutional investors.
Key takeaways:
- Reddit is preparing for its initial public offering (IPO), targeting a top valuation of $6.4 billion, despite having significantly fewer daily active users compared to rivals like Facebook and X.
- The company revealed in its IPO filing that its revenue had grown by around 21% last year, and its net loss at the end of 2023 was $90.8 million, down from a net loss of $158.6 million the previous year.
- Reddit's IPO is between four and five times oversubscribed, indicating strong investor interest despite the company's losses.
- Reddit has struck a licensing deal with Google to make its data available to the search giant's AI models for $60 million a year, which could boost those with a stake in the IPO.