Reddit shares rise by 60% in minutes

The value of the company's shares soared by 60% in just a few minutes after they were opened for trading on the stock exchange.

Here's What We Know

Reddit shares opened at $47 per share, but quickly rose to around $55 and exceeded the initial IPO price of $34 per share. Despite the short-lived rise, their value has stabilised at around $50 per share.

Flashback

An "Initial Public Offering" (IPO) is a process where a private company sells its shares to a public company for the first time on a stock exchange. This allows the company to raise new funds by selling a share of ownership (shares) to investors.

Although Reddit reported revenue of $804 million in 2023, the company continues to incur losses, with a net loss of over $90 million last year. However, it is attracting attention due to its potential in the field of artificial intelligence.

It is worth noting that the Federal Trade Commission has launched an investigation into Reddit's plan to license user data to train artificial intelligence models. This may affect further trading in the company's shares.

Source: TechCrunch