$RDDT seems to have *crushed* Q1 2026 earnings, so why is the stock struggling?
u/nomadicphil ·
Reddit — r/ValueInvesting
· May 08, 2026 at 02:51
· ⬆ 16 pts
· 💬 57 comments
| View on Reddit ↗
AI Summary
Summary
The post highlights Reddit’s Q1 2026 blowout earnings (69% revenue growth, massive EPS beat) yet questions why the stock hasn’t reclaimed January highs.
The author’s implied thesis is that the sell-off is unjustified and that execution will drive the stock higher, though they acknowledge a valuation debate around Google AI Overviews eroding search traffic.
Quality assessment: Speculation with some data (earnings numbers) but lacks deep financial modeling; more of a sentiment-driven observation than rigorous DD.
Q1 2026 showed 69% revenue growth and significant EPS beats, yet the stock is flat versus January highs. If Reddit continues to execute and the AI Overview threat proves overblown, the current discount represents a buying opportunity for value investors. The earnings momentum is strong, and the market’s near-term skepticism (fund flows, AI fears) may create an entry point for medium-term gains. Google AI Overviews permanently reduce search-referral traffic; further macro weakness; insider selling or index rebalancing.