Reddit’s revenue grew 20% before the IPO, but the social network is still not profitable

Bloomberg – Reddit has announced a more than 20% increase in revenue in 2023 compared to the previous year, people familiar with the matter said, as it prepares for one of the most expected for a public offering (IPO) in the United States.

The San Francisco-based consulting firm has advised potential investors that it has over $800 million in revenue last yearup from $666 million seen in 2022, the people said, asking not to be identified because the information is private.

Reddit has yet to report full-year results, with adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) showing a loss of $69 million, one of the people said. The company reported earnings in the fourth quarter, another person said.

Reddit has been advised to consider a minimum valuation of $5 billion for the IPO, as reported by Bloomberg News.

The company is moving forward with its plans to go public more than two years after filing with the US Securities and Exchange Commission. Reddit’s listings were viewed as a sounding board for the IPO market amid a negative impact in sales for the first time in two years.

Reddit and its advisers are expected to release IPO public information later this month, the people said. This will allow the company to start trading its IPO on the New York Stock Exchange in early March.

About 16 banks, led by Morgan Stanley ( MS ) and Goldman Sachs ( GS ), are working on the IPO, the people said. JPMorgan ( JPM ), Bank of America ( BAC ) and Citigroup ( C ) are also among the banks involved in the deal, they said.

Representatives for Reddit, as well as Goldman Sachs, JPMorgan, Bank of America and Citigroup declined to comment, while a spokesperson for Morgan Stanley did not immediately respond to requests for comment.

The timing means Reddit could be the first of a group of big tech IPOs this month, which could include Microsoft ( MSFT ) -invested data security startup Rubrik and the department Healthcare provider Waystar Technologies.

Both companies considered IPOs last year and are now targeting this year, as reported by Bloomberg News.

Reddit, founded in 2005, had more than 70 million unique daily visitors in October, according to its website. It became a symbol of the so-called “age of meme stocks” after a forum on the website, WallStreetBets, led to a stock market.

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