Reddit, Inc.

Previous wording

The following discusses financial conditions and results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023. Discussion of financial conditions and results of operations for the year ended December 31, 2023 compared to the year ended December 31, 2022 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for the year ended December 31, 2023 included in our Prospectus filed with the SEC on March 21, 2024.

Current wording

The following discusses financial conditions and results of operations for the year ended December 31, 2025 compared to the year ended December 31, 2024. Discussion of financial conditions and results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023 can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on 10-K for the year ended December 31, 2024.

Previous wording

•Daily Active Uniques (“DAUq”) were 101.7 million for the three months ended December 31, 2024, an increase of 39% year over year

Current wording

•Daily Active Uniques (“DAUq”) were 121.4 million for the three months ended December 31, 2025, an increase of 19% year over year

Previous wording

•Average revenue per unique (“ARPU”) was $4.21 for the three months ended December 31, 2024, an increase of 23% year over year

Current wording

•Average revenue per unique (“ARPU”) was $5.98 for the three months ended December 31, 2025, an increase of 42% year over year

Previous wording

•Cash, cash equivalents, and marketable securities were $1.8 billion as of December 31, 2024

Current wording

•Cash, cash equivalents, and marketable securities were $2.5 billion as of December 31, 2025

Previous wording

In recent years, the global economy and other macroeconomic conditions, including concerns related to inflation and rising interest rates and geopolitical risks, have resulted in uncertainty in the advertising market and have impacted brands’ and agencies’ ability and willingness to invest in advertising. We expect that these macroeconomic conditions may continue to impact revenue growth in the near term, although we are unable to predict the duration or degree of such volatility with any certainty.

Current wording

In recent years, the global economy and other macroeconomic conditions, including concerns related to inflation and rising interest rates, tariffs, and geopolitical risks, have resulted in uncertainty in the advertising market and have impacted brands’ and agencies’ ability and willingness to invest in advertising. We expect that these macroeconomic conditions may continue to impact revenue growth in the near term, although we are unable to predict the duration or degree of such volatility with any certainty. In addition, we continue to experience competition both for advertising budgets and for user engagement, which could adversely impact our advertising revenue.

Previous wording

Since the continuing impact of these macroeconomic conditions on our results of operations and overall financial performance remains highly unpredictable, our past results may not be indicative of our future performance. Given the uncertainty, we are unable to predict the extent and duration of the impact of these conditions on our employees, users, and advertisers, or our business, results of operations, and financial condition.

Current wording

Since the continuing impact of these business and macroeconomic conditions on our results of operations and overall financial performance remains highly unpredictable, our past results may not be indicative of our future performance. Given the uncertainty, we are unable to predict the extent and duration of the impact of these conditions on our employees, users, and advertisers, or our business, results of operations, and financial condition.

Previous wording

DAUq includes visits from those who have logged in to a registered account as well as those who have not logged in to—or do not have—a registered account. Visitors that come to Reddit from search engines are generally not logged in and originate from both desktop and mobile web. Currently, monetization of these users is mainly through conversation pages and feed ads. Measuring the number of logged-out visitors is difficult and complex. For example, prior to the first quarter of 2023, a portion of our historical DAUq metric counted views of pages that were hosted using Google’s Accelerated Mobile Page (“AMP”) framework. The accuracy of counting the DAUq attributable to this AMP traffic relied on the accuracy and completeness of information received from Google, which had not been historically complete and consistent. As such, our historical DAUq metrics are not directly comparable quarter over quarter or year over year. To the extent that our metric includes views of pages hosted on third-party infrastructure, like Google’s AMP framework, the accuracy and comparability of our metrics will depend on the accuracy and consistency of the information received from any such third party.

Current wording

DAUq includes visits from those who have logged in to a registered account as well as those who have not logged in to—or do not have—a registered account. Visitors that come to Reddit from search engines are generally not logged in and originate from both desktop and mobile web. Currently, monetization of these users is mainly through conversation pages and feed ads.

Previous wording

In addition, we monitor logged-in DAUq, which we define as a user whom we can identify with a unique identifier who has visited a page on the Reddit website, www.reddit.com, or opened a Reddit application at least once during a 24-hour period and was logged in to a registered account. We measure logged-in DAUq because these users tend to have higher engagement and spend more time on our platform compared to users who are not logged in to a registered account.

Current wording

Historically we monitored logged-in DAUq, which we define as a user whom we can identify with a unique identifier who has visited a page on the Reddit website, www.reddit.com, or opened a Reddit application at least once during a 24-hour period and was logged in to a registered account. We measured logged-in DAUq because these users tend to have higher engagement and spend more time on our platform compared to users who are not logged in to a registered account. However, as our business has scaled and our product strategy has evolved, our focus has shifted to delivering immediate value for all users and enabling them to engage with content on Reddit, regardless of whether they are logged in or logged out. As a result, management primarily uses total DAUq and DAUq by geography for managing the business and for evaluating our core operating performance. Therefore, beginning in the quarter ended September 30, 2026, we will no longer report logged-in and logged-out DAUq.

Previous wording

In the three months ended December 31, 2024, global DAUq grew 39% compared to the prior year period, driven by 32% growth in DAUq in the United States and 46% growth in DAUq in the rest of world. Global DAUq grew 5% compared to the prior quarter period, driven by 10% growth in DAUq in the rest of world while DAUq in the United States remained flat. The growth in global DAUq in the three months ended December 31, 2024 compared to the prior year period and prior quarter period was driven by the combination of third-party search engine and algorithm changes, traction in our growth strategies, particularly in machine translation, and product enhancements.

Current wording

In the three months ended December 31, 2025, global DAUq grew 19% compared to the prior year period, driven by 9% growth in DAUq in the United States and 28% growth in DAUq in the rest of world. Global DAUq grew 5% compared to the prior quarter period, driven by 2% growth in DAUq in the United States and 7% growth in DAUq in the rest of world. The growth in global DAUq in the three months ended December 31, 2025 compared to the prior year period and prior quarter period was primarily driven by traction in our growth strategies, particularly in machine translation and marketing.

Previous wording

During the three months ended December 31, 2023 and 2022, we deployed further advances in our process used to identify and address activity by users and visitors, including web crawlers and scrapers. As we identify automated agents, we remove them from our DAUq and WAUq count prospectively and do not recalculate DAUq and WAUq for prior periods if we assess such impact to be immaterial. As we have continued to improve our capabilities to identify suspicious traffic, we have not seen this methodology materially impact trends in DAUq and WAUq from quarter to quarter.

Current wording

During the three months ended December 31, 2023, we deployed further advances in our process used to identify and address activity by users and visitors, including web crawlers and scrapers. As we identify automated agents, we remove them from our WAUq count prospectively and do not recalculate WAUq for prior periods if we assess such impact to be immaterial. As we have continued to improve our capabilities to identify suspicious traffic, we have not seen this methodology materially impact trends in WAUq from quarter to quarter.

Previous wording

In the three months ended December 31, 2024, global WAUq grew 42% compared to the prior year period, driven by 31% growth in WAUq in the United States and 52% growth in WAUq in the rest of world. In the three months ended December 31, 2024, global WAUq increased 4% compared to the prior quarter period, driven by 11% growth in WAUq in the rest of world, partially offset by a 3% decline in WAUq in the United States. For the three months ended December 31, 2024, the proportion of DAUq to WAUq was 27%.

Current wording

In the three months ended December 31, 2025, global WAUq grew 24% compared to the prior year period, driven by 12% growth in WAUq in the United States and 34% growth in WAUq in the rest of world. In the three months ended December 31, 2025, global WAUq increased 6% compared to the prior quarter period, driven by 3% growth in WAUq in the United States and 9% growth in WAUq in the rest of world. For the three months ended December 31, 2025, the proportion of DAUq to WAUq was 26%.

Previous wording

In the year ended December 31, 2024, we recorded revenue of $1.3 billion, as compared to revenue of $804.0 million for the year ended December 31, 2023, representing an increase of 62% compared to the prior year period.

Current wording

We monetize our business primarily through advertising on our mobile applications and website. In the year ended December 31, 2025, we recorded revenue of $2.2 billion, as compared to revenue of $1.3 billion for the year ended December 31, 2024, representing an increase of 69% compared to the prior year period.

Previous wording

We present ARPU globally and also broken out on a United States and rest of world basis because we currently monetize users in the United States and the rest of the world at different rates. We measure ARPU because we believe that this metric helps our management and investors assess the extent to which we are monetizing our DAUq. Monetization of new users is generally at a lower rate than existing users and as such, ARPU tends to grow at a lower rate than revenue in periods of strong DAUq growth. Currently, logged-out users tend to have lower engagement and spend less time on our platform compared to users who are logged in to a registered account, and therefore, logged-in users generally contribute significantly more to ARPU than logged-out users. Our ARPU reflects the seasonality of our advertising revenue, with the fourth quarter typically being the strongest quarter of each year, especially in the United States, our most developed geography. United States ARPU is higher primarily due to the relative size and maturity of the U.S. digital advertising market, a dynamic we expect will continue for the foreseeable future.

Current wording

We present ARPU globally and also broken out on a United States and rest of world basis because we currently monetize users in the United States and the rest of the world at different rates. We measure ARPU because we believe that this metric helps our management and investors assess the extent to which we are monetizing our DAUq. Monetization of new users is generally at a lower rate than existing users and as such, ARPU tends to grow at a lower rate than revenue in periods of strong DAUq growth. Our ARPU reflects the seasonality of our advertising revenue, with the fourth quarter typically being the strongest quarter of each year, especially in the United States, our most developed geography. United States ARPU is higher primarily due to the relative size and maturity of the U.S. digital advertising market, a dynamic we expect will continue for the foreseeable future.

Previous wording

During the three months ended December 31, 2024, ARPU was $4.21, an increase of 23% compared to $3.42 for the prior year period, United States ARPU was $7.04, compared to $5.51 for the prior year period, and rest of world ARPU was $1.67, compared to $1.34 for the prior year period. The increase in global ARPU compared to the prior year period was due primarily to an increase in advertising revenue driven by an increase in impressions delivered, and to a lesser extent, an increase in content licensing revenue. The increase in global ARPU compared to the prior quarter period was due primarily to an increase in advertising revenue driven by an increase in impressions delivered, and to a lesser extent, an increase in pricing.

Current wording

During the three months ended December 31, 2025, ARPU was $5.98, an increase of 42% compared to $4.21 for the prior year period, United States ARPU was $10.79, compared to $7.04 for the prior year period, and rest of world ARPU was $2.31, compared to $1.67 for the prior year period. The increase in global ARPU compared to the prior year period was due primarily to an increase in advertising revenue driven by an increase in impressions delivered, and to a lesser extent, an increase in pricing. The increase in global ARPU compared to the prior quarter period was due primarily to an increase in advertising revenue driven by an increase in pricing, and to a lesser extent, an increase in impressions delivered.

Previous wording

We also generate revenue from content licensing, Reddit Premium subscriptions, and products within our user economy. In our content licensing arrangements, we provide customers with the right to access content from our platform over the contractual period. We recognize content licensing revenue as our content partners consume and benefit from their use of the licensed content, which is generally ratably over the license period. We recognize Reddit Premium subscription revenue ratably over the subscription period, which is generally less than one year. Products within our user economy include Reddit Gold and Collectible Avatars. Revenue from Reddit Gold and Collectible Avatars was not material for the years ended December 31, 2024, 2023, and 2022.

Current wording

We also generate revenue from content licensing and products sold directly to users. In our content licensing arrangements, we provide customers with the right to access content from our platform over the contractual period. We recognize content licensing revenue as our content partners consume and benefit from their use of the licensed content, which is generally ratably over the license period. Revenue from other products sold directly to users, including Reddit Premium and Reddit Gold, was not material for the periods presented.

Previous wording

Cost of revenue consists primarily of payments to third parties for the cost of hosting and supporting our mobile applications and website. In addition, cost of revenue includes expenses directly associated with the delivery of our advertising and other services, including advertising measurement services and credit card and other transaction processing fees. Cost of revenue also consists of employee-related costs, including salaries, benefits, and stock-based compensation.

Current wording

Cost of revenue consists primarily of payments to third parties for the cost of hosting and supporting our mobile applications and website. In addition, cost of revenue includes expenses directly associated with the delivery of our advertising and other services, including advertising targeting and measurement services, credit card and other transaction processing fees, and payments to our content partners. Cost of revenue also consists of employee-related costs, including salaries, benefits, and stock-based compensation.

Previous wording

Research and development expenses consist primarily of employee-related costs including salaries, benefits, and stock-based compensation for engineers and other employees engaged in the research, design, and development of new and existing products. Research and development expenses also include professional services and hosting costs associated with internal research and development activities, as well as allocated facilities and other supporting overhead costs.

Current wording

Research and development expenses consist primarily of employee-related costs including salaries, benefits, and stock-based compensation for engineers and other employees engaged in the research, design, and development of new and existing products. Research and development expenses also include hosting costs associated with internal research and development activities, as well as professional services, allocated facilities, and other supporting overhead costs.

Previous wording

Sales and marketing expenses consist primarily of employee-related costs including salaries, benefits, and stock-based compensation for employees engaged in sales, sales support, business and brand development, marketing, and customer service functions. Sales commissions are expensed as incurred in sales and marketing expenses as the expected period of benefit is one year or less. Sales and marketing expenses also include costs incurred for advertising, market research, branding, professional services, marketing, and promotional expenditures, as well as allocated facilities and other supporting overhead costs.

Current wording

Sales and marketing expenses consist primarily of employee-related costs including salaries, benefits, and stock-based compensation for employees engaged in sales, sales support, business and brand development, marketing, and customer service functions. Sales commissions are expensed as incurred in sales and marketing expenses as the expected period of benefit is one year or less. Sales and marketing expenses also include costs incurred for advertising, marketing, and other promotional expenditures, as well as professional services, allocated facilities, and other supporting overhead costs.

Previous wording

General and administrative expenses consist primarily of employee-related costs including salaries, benefits, and stock-based compensation for certain executives as well as employees engaged in finance, legal, human resources, information technology, communications, and other administrative teams. General and administrative expenses also include costs incurred for professional services, as well as allocated facilities and other supporting overhead costs.

Current wording

General and administrative expenses consist primarily of employee-related costs including salaries, benefits, and stock-based compensation for certain executives as well as employees engaged in finance, legal, human resources, information technology, and other administrative teams. General and administrative expenses also include costs incurred for professional services, non-income based taxes, insurance, allocated facilities, and other supporting overhead costs.

Previous wording

Revenue for the year ended December 31, 2024 increased by $496.2 million, or 62%, compared to the prior year. The growth in revenue was due primarily to an increase in advertising revenue driven mainly by an increase in impressions delivered. In addition, other revenues increased as a result of content licensing agreements executed in 2024.

Current wording

Revenue for the year ended December 31, 2025 increased by $902.3 million, or 69%, compared to the prior year. The growth in revenue was due primarily to an increase in advertising revenue driven by an increase in impressions delivered and to a lesser extent, an increase in pricing. In addition, other revenues increased as a result of content licensing agreements executed in 2024 and 2025.

Previous wording

Cost of revenue for the year ended December 31, 2024 increased by $12.6 million, or 11%, compared to the prior year. The increase in cost of revenue was primarily attributable to increased hosting usage to support user growth on our platform and an increase in advertising measurement and other services, partially offset by lower hosting prices and hosting cost efficiencies.

Current wording

Cost of revenue for the year ended December 31, 2025 increased by $70.6 million, or 57%, compared to the prior year. The increase in cost of revenue was primarily attributable to increased hosting usage to support product enhancements and user growth on our platform, as well as an increase in other services related to advertising, partially offset by lower hosting prices.

Previous wording

Research and development expenses for the year ended December 31, 2024 increased by $496.8 million, or 113%, compared to the prior year. The increase was driven primarily by higher stock-based compensation expense and related taxes, including the cumulative catch-up upon IPO of stock-based compensation expense and related taxes for RSUs with a liquidity-based vesting condition and an increase in other employee-related costs.

Current wording

Research and development expenses for the year ended December 31, 2025 decreased by $152.0 million, or 16%, compared to the prior year. The decrease was driven primarily by the cumulative catch-up upon IPO of stock-based compensation expense and related taxes for RSUs with a liquidity-based vesting condition recognized in the prior year period, partially offset by an increase in other employee-related costs and an increase in hosting costs associated with internal research and development activities in the current period.

Previous wording

Sales and marketing expenses for the year ended December 31, 2024 increased by $120.4 million, or 52%, compared to the prior year. The increase was driven primarily by higher stock-based compensation expense and related taxes, including the cumulative catch-up upon IPO of stock-based compensation expense and related taxes for RSUs with a liquidity-based vesting condition and an increase in other employee-related costs.

Current wording

Sales and marketing expenses for the year ended December 31, 2025 increased by $153.3 million, or 44%, compared to the prior year. The increase was due primarily to an increase in user and brand marketing expenses and in employee-related costs, driven in part by an increase in headcount. The increase was partially offset by the cumulative catch-up upon IPO of stock-based compensation expense and related taxes for RSUs with a liquidity-based vesting condition recognized in the prior year period.

Previous wording

General and administrative expenses for the year ended December 31, 2024 increased by $286.8 million, or 174%, compared to the prior year. The increase was driven primarily by higher stock-based compensation expense and related taxes, including the cumulative catch-up upon IPO of stock-based compensation expense and related taxes for RSUs with a liquidity-based vesting condition.

Current wording

General and administrative expenses for the year ended December 31, 2025 decreased by $172.1 million, or 38%, compared to the prior year. The decrease was driven primarily by the cumulative catch-up upon IPO of stock-based compensation expense and related taxes for RSUs with a liquidity-based vesting condition recognized in the prior year period.

Previous wording

Other income (expense), net for the year ended December 31, 2024 increased by $22.2 million, or 42%, compared to the prior year. The increase was primarily due to higher interest earned on our cash and investments driven by a higher invested balance and higher interest rates.

Current wording

Other income (expense), net for the year ended December 31, 2025 increased by $11.3 million, or 15%, compared to the prior year. The increase was primarily due to higher interest earned on our cash and investments driven by a higher invested balance.

Previous wording

We have historically financed our operations primarily through net proceeds from the sale of convertible preferred stock and payments received from our customers. Additionally, in March 2024, we completed our IPO, which resulted in net proceeds of $600.0 million after deducting underwriting discounts and commissions of $31.6 million. We began generating net positive operating cash flows in 2024. Our primary uses of cash are employee-related costs and the cost of hosting our mobile applications and website.

Current wording

We have historically financed our operations primarily through net proceeds from the sale of convertible preferred stock and payments received from our customers. Additionally, in March 2024, we completed our IPO, which resulted in net proceeds of $600.0 million after deducting underwriting discounts and commissions of $31.6 million. We began generating net positive operating cash flows in 2024. Our primary uses of cash are employee-related costs and the cost of operating our mobile applications and website.

Previous wording

As of December 31, 2024, we had $1.8 billion in cash, cash equivalents, and marketable securities. Our cash and cash equivalents consist of cash in bank accounts, money market accounts, and other highly liquid investments with original maturities of 90 days or less from the date of purchase. Marketable securities consist of U.S. and non-U.S. government securities, investment-grade corporate and government agency securities, certificates of deposit, and commercial paper. As of December 31, 2024, approximately 2% of our cash, cash equivalents, and marketable securities was held outside of the United States.

Current wording

As of December 31, 2025, we had $2.5 billion in cash, cash equivalents, and marketable securities. Our cash and cash equivalents consist of cash in bank accounts, money market accounts, time deposits, and other highly liquid investments with original maturities of 90 days or less from the date of purchase. Marketable securities consist of U.S. government securities, investment-grade corporate and government agency securities, time deposits, and commercial paper. As of December 31, 2025, approximately 2% of our cash, cash equivalents, and marketable securities was held outside of the United States.

Previous wording

On October 8, 2021, we entered into a five-year, $750.0 million, revolving loan and standby letter of credit facility agreement (“Revolving Credit Facility”) of which $100.0 million can be issued as letters of credit. As of December 31, 2024, we have issued two letters of credit, one of which is denominated in a foreign currency, for an aggregate of $4.9 million, which reduced the letter of credit borrowings available under the Revolving Credit Facility to $95.1 million. The aggregate available balance under the Revolving Credit Facility was $745.1 million as of December 31, 2024.

Current wording

On July 1, 2025, we entered into an Amended and Restated Credit and Guarantee Agreement, which amended and restated our prior Credit and Guarantee Agreement dated October 8, 2021 (as amended on May 23, 2023), and provides for a five-year, $500.0 million, revolving loan and standby letter of credit facility (“Revolving Credit Facility”) of which $100.0 million can be issued as letters of credit and another $100.0 million of which can be borrowed in certain non-U.S. dollar currencies. As of December 31, 2025, we have issued three letters of credit, two of which are denominated in a foreign currency, for an aggregate of $5.3 million, which reduced the letter of credit borrowings available under the Revolving Credit Facility to $94.7 million. The aggregate available balance under the Revolving Credit Facility was $494.7 million as of December 31, 2025.

Previous wording

On May 23, 2023, we amended the terms of the Revolving Credit Facility to replace LIBOR with Term SOFR as the interest rate benchmark. Under the amended terms of the Revolving Credit Facility, borrowings can be either ABR Loans, Term Benchmark Loans, or SONIA Loans. Outstanding ABR Loans bear interest at a rate equal to the greatest of (A) the Prime Rate, (B) the NYFRB Rate plus 0.5%, (C) the Adjusted Term SOFR Rate plus 1.0%, or (D) 1.0% (each as defined in the amended Revolving Credit Facility), in each case plus 0.25%. Outstanding Term Benchmark Loans bear interest at the Adjusted Term SOFR Rate, the Adjusted EURIBOR Rate, or the Adjusted AUD Rate (each as defined in the amended Revolving Credit Facility), as applicable, in each case, plus 1.25%. Outstanding SONIA Loans bear interest at a rate equal to the Adjusted Daily Simple SONIA (as such term is defined in the amended Revolving Credit Facility) plus 1.25%. We are required to pay a quarterly commitment fee that accrues at 0.15% per annum on the unused portion of the aggregate commitments under the credit facility.

Current wording

Outstanding Term Benchmark Loans bear interest at the Adjusted Term SOFR Rate, the Adjusted EURIBOR Rate, the Adjusted Term CORRA Rate, or the Adjusted AUD Rate (each as defined in the Revolving Credit Facility), as applicable, in each case plus 1.25%. Outstanding RFR Loans bear interest at a rate equal to the Adjusted Daily Simple RFR (as such term is defined in the Revolving Credit Facility) plus 1.25%. We are required to pay a quarterly commitment fee that accrues at 0.15% per annum on the unused portion of the aggregate commitments under the Revolving Credit Facility.

Previous wording

The Revolving Credit Facility contains customary conditions on our borrowing, including events of default and covenants. Covenants include restrictions on our and certain of our subsidiaries’ ability to incur indebtedness, grant liens, make distributions to holders of our preferred and common stock, make investments, or engage in transactions with our affiliates, and require us to maintain a minimum liquidity. The obligations under the Revolving Credit Facility are secured by liens on substantially all of our assets, including intellectual property assets. We were in compliance with all covenants as of December 31, 2024.

Current wording

The Revolving Credit Facility contains customary conditions on our borrowings, including events of default and covenants. Covenants include restrictions on our and certain of our subsidiaries’ ability to incur indebtedness, grant liens, make distributions to holders of our preferred and common stock, make investments, or engage in transactions with our affiliates, and require us to adhere to a maximum total leverage ratio. The obligations under the Revolving Credit Facility are secured by liens on substantially all of our assets, including intellectual property assets. However, the Revolving Credit Facility provides for the permanent release of guarantees and collateral upon our achievement of certain investment grade ratings. We were in compliance with all covenants as of December 31, 2025.

Previous wording

Net cash provided by operating activities was $222.1 million in the year ended December 31, 2024, resulting primarily from adjustments for non-cash items, primarily related to stock-based compensation expense of $801.6 million, and an increase in accrued expenses and other liabilities of $59.3 million due to timing of payments. These increases were partially offset by net loss of $(484.3) million, an increase in accounts receivable of $104.3 million related to an increase in advertising revenue, and amortization of premium (accretion of discount) on marketable securities, net, of $(43.4) million. Net cash used in operating activities was $(75.1) million in the year ended December 31, 2023, resulting primarily from net loss of $(90.8) million, and an increase in accounts receivable of $53.3 million related to an increase in advertising revenue. These increases were partially offset by adjustments for non-cash items, primarily related to stock-based compensation expense of $47.6 million, and an increase in accounts payable and accrued expenses and other liabilities of $25.2 million due to timing of payments.

Current wording

Net cash provided by operating activities was $690.9 million in the year ended December 31, 2025, resulting primarily from net income of $529.7 million in the year ended December 31, 2025, adjustments for non-cash items, primarily related to stock-based compensation expense of $343.2 million, and an increase in accounts payable and accrued expenses and other liabilities of $108.9 million due to timing of payments. These increases were partially offset by an increase in accounts receivable of $241.4 million related to an increase in advertising revenue, an increase in prepaid expenses and other assets of $37.1 million due to timing of prepayments, and amortization of premium (accretion of discount) on marketable securities, net, of $(28.2) million. Net cash provided by operating activities was $222.1 million in the year ended December 31, 2024, resulting primarily from adjustments for non-cash items, primarily related to stock-based compensation expense of $801.6 million, and an increase in accrued expenses and other liabilities of $59.3 million due to timing of payments. These increases were partially offset by net loss of $(484.3) million, an increase in accounts receivable of $104.3 million related to an increase in advertising revenue, and amortization of premium (accretion of discount) on marketable securities, net, of $(43.4) million.

Previous wording

Net cash used in investing activities was $(440.7) million in the year ended December 31, 2024, primarily due to additional purchases of marketable securities of $2.0 billion and cash paid for acquisitions, net of cash acquired of $17.1 million, partially offset by maturities of marketable securities of $1.6 billion. Net cash provided by investing activities was $41.3 million in the year ended December 31, 2023, primarily due to maturities and proceeds from the sale of marketable securities of $1.3 billion, partially offset by additional purchases of marketable securities.

Current wording

Net cash used in investing activities was $(218.9) million in the year ended December 31, 2025, primarily due to additional purchases of marketable securities of $2.3 billion, partially offset by maturities and proceeds from sale of marketable securities of $2.1 billion. Net cash used in investing activities was $(440.7) million in the year ended December 31, 2024, primarily due to additional purchases of marketable securities of $2.0 billion and cash paid for acquisitions, net of cash acquired of $17.1 million, partially offset by maturities of marketable securities of $1.6 billion.

Previous wording

Net cash provided by financing activities was $379.5 million in the year ended December 31, 2024 and consisted primarily of cash proceeds from the issuance of Class A common stock in our IPO, net of underwriting discounts and commissions, of $600.0 million and proceeds from exercises of employee stock options of $89.0 million, partially offset by taxes paid related to net share settlement of restricted stock units of $294.6 million. Net cash used in financing activities was $(0.8) million in the year ended December 31, 2023 and consisted primarily of cash payments of $4.3 million for taxes paid related to net share settlement of restricted stock units and other financing activities of $4.9 million, partially offset by proceeds from exercises of employee stock options of $8.4 million.

Current wording

Net cash used in financing activities was $(80.6) million in the year ended December 31, 2025 and consisted primarily of cash payments for taxes paid related to net share settlement of restricted stock units of $104.0 million, partially offset by proceeds from exercises of employee stock options of $25.1 million. Net cash provided by financing activities was $379.5 million in the year ended December 31, 2024 and consisted primarily of cash proceeds from the issuance of Class A common stock in our IPO, net of underwriting discounts and commissions, of $600.0 million and proceeds from exercises of employee stock options of $89.0 million, partially offset by taxes paid related to net share settlement of restricted stock units of $294.6 million.

Previous wording

Free Cash Flow was $215.8 million for the year ended December 31, 2024, and was composed of net cash provided by operating activities, resulting primarily from adjustments for non-cash items, partially offset by net loss and changes in working capital. Free Cash Flow was $(84.8) million for the year ended December 31, 2023, and was composed of net cash used in operating activities, resulting primarily from net loss, partially offset by adjustments for non-cash items and changes in working capital. Free Cash Flow also included purchases of property and equipment of $6.2 million and $9.7 million for the years ended December 31, 2024 and 2023, respectively. For the year ended December 31, 2024, the increase in Free Cash Flow as compared to the prior year was driven primarily by the increase in cash provided by operating activities.

Current wording

Free Cash Flow was $684.2 million for the year ended December 31, 2025, and was composed of net cash provided by operating activities, resulting primarily from net income and adjustments for non-cash items, partially offset by changes in working capital. Free Cash Flow was $215.8 million for the year ended December 31, 2024, and was composed of net cash provided by operating activities, resulting primarily from adjustments for non-cash items, partially offset by net loss and changes in working capital. Free Cash Flow also included purchases of property and equipment of $6.7 million and $6.2 million for the years ended December 31, 2025 and 2024, respectively. For the year ended December 31, 2025, the increase in Free Cash Flow as compared to the prior year was driven primarily by the increase in cash provided by operating activities.

Previous wording

We did not have during the periods presented, and we do not currently have, any off-balance sheet financing arrangements or any relationships with unconsolidated entities or financial partnerships, including entities sometimes referred to as structured finance or special purpose entities, that were established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

Current wording

During the periods presented, we did not have, and we do not currently have, any off-balance sheet financing arrangements or any relationships with unconsolidated entities or financial partnerships, including entities sometimes referred to as structured finance or special purpose entities, that were established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

Previous wording

The critical accounting estimates, assumptions, and judgments that we believe to have the most significant impact on our consolidated financial statements are described below. Refer to Note 2—Basis of Presentation and Significant Accounting Policies of the notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further information on our other significant accounting policies.

Current wording

The critical accounting estimates, assumptions, and judgments that we believe to have the most significant impact on our consolidated financial statements are described below. Refer to Note 2—Basis of Presentation and Significant Accounting Policies of the notes to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further information on other significant accounting policies.

Previous wording

We generate a majority of our revenue through the sale of advertising on our mobile applications and website. Other revenue consists of revenue from content licensing, Reddit Premium subscriptions, and products within our user economy.

Current wording

We generate a majority of our revenue through the sale of advertising on our mobile applications and website. Other revenue consists of revenue from content licensing and products sold directly to users.

Previous wording

In our content licensing arrangements, we provide customers with the right to access content from our platform over the contractual period. The transaction price in content licensing arrangements is generally a fixed fee or usage-based fee. We recognize content licensing revenue as our content partners consume and benefit from their use of the licensed content, which is generally ratably over the license period. We recognize Reddit Premium subscription revenue ratably over the subscription period, which is generally less than one year. Products within our user economy include Reddit Gold and Collectible Avatars. Revenue from Reddit Gold and Collectible Avatars was not material for the years ended December 31, 2024, 2023, and 2022.

Current wording

In our content licensing arrangements, we provide customers with the right to access content from our platform over the contractual period. The transaction price in content licensing arrangements is generally a fixed fee or usage-based fee. We recognize content licensing revenue as our content partners consume and benefit from their use of the licensed content, which is generally ratably over the license period. Revenue from products sold directly to users, including Reddit Premium and Reddit Gold, was not material for the periods presented.