Reddit’s share price fell in its second day of trading Friday, cooling off—but not fully erasing its gains—after an explosive Thursday in which shares increased nearly 60% following its initial public offering.
Reddit went public Thursday morning. (Photo by Jakub Porzycki/NurPhoto via Getty Images)
Reddit’s stock closed down 8.8% at $46 per share Friday, reeling back from the high of $55.38 it posted Thursday.
The slide comes after a monster day of trading Thursday, when the social media platform opened at $34 per share and closed at $50.44.
Reddit’s market capitalization reduced to $7.3 billion Friday, down 14% from the previous day of trading—though it still remains well above its opening $6.4 billion valuation.
The company’s IPO was one of the most anticipated of the year, as a whopping $748 million was raised for the public listing. Reddit reported a $140 million loss on $804 million of revenue last year, though as a stock, the Bernstein group has characterized it as a “unique asset,” citing the potential of it being “undermonetized,” its strong revenue advertising growth and potential for AI-related sales. The company was founded in 2005.
Reddit’s stock made its public debut on a day when all three major U.S. stock indexes recorded all-time highs.
Reddit IPO: Stock Rallies 60% In Wall Street Debut (Forbes)
As Reddit Went Public, Redditors Gave It An Irreverent Welcome (Forbes)