Reddit Stock Spikes Over 6% After-hours After Earning Beat, Platform Considers Putting Ads In Comments To Monetize High 'Engagement'

Social media platform, Reddit Inc. RDDT is seeing strong commercial intent across its iconic comment threads, and it’s now turning that engagement into ad revenue as part of a broader monetization push.

What Happened: During the company’s first quarter earnings call on Thursday, COO Jen Wong addressed the new ad placements inside the platform’s comments section, which is known for its high levels of engagement and activity. This comes in addition to the ads that were already in place below the post and above the comments.

Wong notes that 40% of conversations on Reddit are commercial in nature, with users actively discussing products and services. Given the high engagement, she said, many users are on their “purchase decision journey,” making the platform’s comments section ripe for ad placements.

“I think almost no [other] platform has ads in their comments,” Wong said, adding that this level of engagement is a uniquely Reddit trait.

See More: Robinhood Stock Falls After Analysts Cite Weak Crypto Volumes And Market Headwinds In Q2 Outlook

Wong explains that there are two ways that people end up in Reddit’s famed comments section: either by clicking on search results for a very specific query, looking for answers in the comments, or by engaging with a post on their feed, because it looked interesting. Either way, she says, “the intent in the space is very high.”

Reddit is encouraged by early results, with Wong noting earlier in the call that ads within comment sections already accounted for 6% of total ad impressions during the quarter.

Why It Matters: Analysts had predicted Reddit’s ad revenue growth to outpace that of peers in 2025, citing its growing appeal to advertisers and the community-driven nature of the platform.

Analysts also attribute the company’s growing ad business to the significant enhancements it has made to its advertising tools over the past year.

The company is now focused on accelerating its global expansion, turning towards countries such as Brazil and India for user growth, as well as advertising opportunities.

The strong advertising performance is aiding Reddit’s bottom line, with the company reporting $0.13 earnings per share, from $392 million in revenue, up 61% YoY.

Price Action: The stock was up 1.96% during the regular session on Thursday, and is up 6.49% in after-hours trading, following the announcement of its first quarter results.