Reddit IPO's Wall Street debut: Social media stock makes roaring start, closing up nearly 50%

Reddit IPO: Shares of the San Francisco-based company opened at $47 on the New York Stock Exchange.

Published on: Mar 22, 2024, 07:45:09 IST

By HT News Desk

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Social media platform Reddit's shares ended their first day of trading up 48%. The company touted AI in its IPO marketing roadshow as an area of growth and said last week that the US Federal Trade Commission is looking into its AI data licensing deals. Jen Wong, Chief Operations Officer at Reddit, said as per news agency Reuters, “At the core we are a growth company. Achieving our mission means that we want to grow users and community.”

Reddit IPO: Reddit logo is seen in this illustration. The IPO of the company is valued at $6.4 billion, and the company and its selling shareholders raised $748 million. (Reuters)

How Reddit shares performed on Day 1?

Shares of the San Francisco-based company opened at $47 on the New York Stock Exchange after pricing at $34 in the IPO, the top of the company's indicated price range. The shares ended trading at $50.44.

Reddit IPO details

The IPO of the company is valued at $6.4 billion, and the company and its selling shareholders raised $748 million. The company was valued at $10 billion in a private fundraising round in 2021 and its entry into public markets has been a long time coming. Reddit had earlier confidentially filed for an IPO in December 2021 but a stock rout froze much of the IPO market and pushed it to delay.

What experts said on Reddit IPO

Josh White, assistant professor of finance at Vanderbilt University, said Reddit's IPO showed investors were willing to ignore the company's losses.

"We don't get many large tech IPOs. Those tend to be very popular because it's hard to buy that kind of growth," Josh White told Reuters.

Read more: Reddit plans $748 million IPO, one of the biggest so far this year: Details

Reena Aggarwal, director of the Georgetown University Psaros Center for Financial Markets and Policy, said, “The real news is going to be after the first earnings call - where are they headed, what are the results looking like, what changes are they going to make.”

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HT News Desk
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