Reddit Inc

Equity Research 31 July 2026 | 12:03AM EDT

Reddit Inc. (RDDT) Q2’26 Review: Operating Momentum (Revenue and Margins) Sustain; Investments & Mgmt Focused on User Growth and Engagement

RDDT 12m Price Target: $215.00 Price: $178.04 Upside: 20.8% NEUTRAL Eric Sheridan In Reddit’s (RDDT) Q2’26 earnings report, management framed its | Goldman Sachs & Co. LLC operating results and forward commentary across a few key themes: Alex Vegliante, CFA 1) continued strong execution and operational output around | Goldman Sachs & Co. LLC scaling revenue growth in the core advertising business (improved ad product performance, targeting initiatives, improved conversion Emma Huang | Goldman Sachs & Co. LLC and growing advertiser base); 2) continued user growth volatility across various sources of traffic with efforts aimed at product improvements around converting user behavior into direct usage Key Data _____________________________________ Market cap: $36.0bn and more regular engagement with a focus on mobile app, retention Enterprise value: $32.5bn 3m ADTV: $857.6mn and personalization; 3) management expressing their view that the United States value of content on the Reddit platform continues to rise as broader Americas Internet M&A Rank: 3 AI adoption increases, while also acknowledging that the impact of GS Forecast __________________________________ AI’s diffusion across different internet platforms e.g. search remains 12/25 12/26E 12/27E 12/28E

non-linear and uncertain (and something that needs to be navigated Revenue ($ mn) New Revenue ($ mn) Old 2,202.5 2,202.5 3,382.7 3,158.8 4,355.5 4,127.1 5,408.2 5,125.1 either through product innovation or further refinement of industry EBITDA ($ mn) 845.1 1,529.2 2,142.1 2,792.7 EBIT ($ mn) 845.1 1,529.2 2,142.1 2,792.7 relationships); 4) operating leverage remains a key cornerstone of EPS ($) New exceeding revenue forecasts (and more than offsetting continued EPS ($) Old P/E (X) investments in platform and product initiatives alongside user Dividend yield (%) -- -- -- -- conversion plans); & 5) no update on data licensing renewal efforts Net debt/EBITDA (X) (2.9) (2.3) (2.4) (2.7)

as investor questions continue to rise about the core relationship 6/26 9/26E 12/26E 3/27E with licensing partners, how those deals might be renewed and how EPS ($)

the overall value of data/content from the company’s platform GS Factor Profile ______________________________ Growth might create increased monetization potential in the coming years. In total, while the company continues to navigate some volatility in Financial Returns

terms of the impacts that search traffic and broader AI might have Multiple

on overall user traffic, management remains focused on building Integrated scaled user behavior, monetization outcomes and the overall trajectory of operating leverage on the back of that revenue Percentile 20th 40th 60th 80th 100th

cadence. RDDT relative to Americas Coverage RDDT relative to Americas Internet Short-term investor debates are likely to remain focused on a mixture of linear and sustained trends around user growth & Source: Company data, Goldman Sachs Research estimates. See disclosures for details. engagement while also remaining focused on any changes across the overall ad macro and competitive landscape in 2H 2026. We look to

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Goldman Sachs Reddit Inc. (RDDT)

Reddit Inc. (RDDT) Balance Sheet ($ mn) _______________________________________ NEUTRAL Rating since Apr 15, 2024 12/25 12/26E 12/27E 12/28E Cash & cash equivalents 953.6 2,175.5 3,939.7 6,242.9 Accounts receivable ,097.4 1,364.1 Inventory -- -- -- -- Ratios & Valuation __________________________________________ Other current…