Welcome to the market, RDDT! Reddit stock jumps on first day as a public company

Reddit, one of the original social media companies, is finally making its debut on the New York Stock Exchange Thursday — more than a decade after many of its peers.

Reddit, one of the original social media companies, is finally making its debut on the New York Stock Exchange Thursday — more than a decade after many of its peers. Trading under the ticker “RDDT,” shares started trading at $47 and reached a high of $57.80 early Thursday afternoon, up as much as 70% from its initial price offering of $34. At its peak, shares of the stock had a market cap of about $10.9 billion. It’s a major milestone for the nearly 20-year-old company, something Reddit has been preparing for since at least 2021, when it hired its first chief financial officer. It also marks the first social media company to go public in years, and its performance could be a signpost for other companies considering IPOs. Funds raised from a successful IPO could help Reddit invest in key areas for growth, including building out new revenue streams as it seeks to stake a claim as a data provider for the burgeoning artificial intelligence language model industry. A successful public offering could also establish a sustainable ownership structure for a company with a history of ownership changes and leadership controversies. But its success is far from guaranteed. Reddit has never turned a profit, and by its own admission, “we may not be able to achieve or maintain profitability in the future.” The company is also giving loyal users a chance to buy IPO shares, a move that’s “great for PR but practically risky,” according to Kamran Ansari, Venture Partner at investment firm Headline, because those users could cause volatility in the share price right out of the gate if they quickly sell the stock. It’s been a rough few years for the IPO market — and successful IPOs typically beget other successful listings. While 2021 was a record-breaking year for companies looking to make their public debuts on the US stock market, dealmaking on Wall Street has largely dried up since, as executives have contended with recession fears, elevated interest rates and geopolitical tensions.