W6/Getty Images; Jenny Chang-Rodriguez/BI
- Reddit saw a 50% increase in daily active users in the second quarter, outpacing competitors.
- The platform's growth contrasts with X's 1.6% and Meta's 7% increases in the same period.
- Reddit's success is driven by its use as a search engine and partnerships with OpenAI and Google.
Reddit may be one of the only social media companies seeing tons of new people sign up.
The forum-based platform saw a 51% increase in daily active users globally and a 59% increase in the US in the second quarter of the year, a stark difference from some of its competitors.
X said daily active users grew 1.6% in the same period, the FT reported. Meta's platforms ,which include Facebook, Instagram, and Threads, reported an increase of 7%, per the company's second-quarter earnings. Even TikTok, which dominated the social media race since 2018, saw user growth collapse to 0% at the end of 2023 — and the privately-held company has not reported user numbers since then.
Reddit is growing fast — but it's comparatively small. The platform had 342 million active users, while Meta had 3.3 billion users, the companies said in their earnings reports this quarter.
Daily active users are a measure of how much people want to engage with a platform. It's an important metric for social media companies because more users typically translates to more advertising money.
Reddit, which went public in March, reported its second round of earnings as a listed company on Tuesday. The company made $281 million in revenue, a 54% year-on-year increase, which it attributed to advertising revenue growth and licensing deals with OpenAI and Google.
"User growth has continued to climb," said Steve Huffman, Reddit's co-Founder and CEO, on a Tuesday earnings call. "More and more people are coming to Reddit to explore their interests, engage in conversations and find their communities."
User-generated push
One of the drivers of Reddit's success, while the rest of Big Tech struggles to win user attention, is that people are treating the platform like a search engine.
"Users run over 1 billion search queries a month on Reddit today," Huffman said in the earnings call.
Reddit also beat every other social media platform in terms of monthly traffic in the past year. Reddit's desktop and mobile website visits shot up by 39% year-over-year in May, while Facebook had an 8% decline.
Reddit's licensing partnership with OpenAI is expected to encourage more Reddit content on ChatGPT as well.
And existing search engines' Reddit links are also driving user growth.
In August, Google rolled out a big search update that seemed to propel user-generated content, after years of noticing users add "Reddit" to the end of their search words. The update gave Reddit, and another forum-based platform Quora, more visibility on Google.
"Our research has shown that people often want to learn from others' experiences with a topic, so we've continued to make it easier to find helpful perspectives on Search when it's relevant to a query," a Google spokesperson previously told Business Insider.
In February, Google and Reddit also signed a licensing deal allowing the search giant to train its AI models based on the forum's content.