Reddit is planning to go public on the New York Stock Exchange with the ticker symbol RDDT.

• Reddit on Thursday filed to go public.
• The first major tech IPO of the year and the first social media IPO since Pinterest's debut in 2019 will be marked by its market debut.
• PitchBook reports that the social media company, founded in 2005 by technology entrepreneurs Alexis Ohanian and Steve Huffman, has raised approximately $1.3 billion in funding and has a post-valuation of $10 billion.

Reddit, a social media company, filed its IPO prospectus with the Securities and Exchange Commission on Thursday and plans to trade on the New York Stock Exchange under the ticker symbol "RDDT."

The first major tech initial public offering of the year is set to debut in March, marking the first social media IPO since 2019.

Since its founding in 2005 by technology entrepreneurs Alexis Ohanian and Steve Huffman, the company has consistently reported net losses. In the year ended Dec. 31, 2023, the company recorded a net loss of $90.8 million, a significant improvement from the $158.6 million net loss reported in the previous year.

Reddit has over 100,000 communities, 73 million daily active uniques, or DAUq, and 267 million weekly active uniques, according to the filing. In the fourth quarter of 2023, Reddit's U.S. average revenue per user, or ARPU, was $5.51, a 4% decline from the previous year's $5.92. The company's global ARPU was $3.42, a 2% year-over-year decline from $3.49.

Reddit aims to enhance its ad business through artificial intelligence and anticipates generating new revenue streams by providing tools and incentives to encourage content creation, improvements, and commerce. Additionally, the company is in the initial stages of establishing a data-licensing business that would enable third parties to access and search data on its platform.

On Thursday, Google announced an expanded partnership with Reddit, granting the search giant access to the company's data to train its AI models.

In June, several prominent Reddit moderators locked subreddits in protest of the company's decision to increase the price some third-party developers pay to use its API, which they claimed was necessary due to big tech companies using data to train large language models.

In 2024, Reddit entered into data licensing agreements worth $203.0 million with terms ranging from two to three years. The company expects to recognize a minimum of $66.4 million in revenue during the year ending December 31, 2024 and the remaining thereafter.

Reddit is considering adopting a business strategy similar to that of social gaming platform and online retailer eBay, which generates most of its revenue through digital sales. The company aims to introduce new features to create a user economy that could include games, according to a filing. Reddit already has informal exchanges of physical and digital goods and services that could potentially generate another revenue stream.

Reddit will provide three types of stocks with varying voting shares. Class A shares will have one vote per share, while Class B shares will have 10 votes per share and can be converted into one share of Class A stock at any time. Class C shares will not have any voting rights.

Reddit announced that its non-employed moderators, known as Redditors, can participate in the company's IPO offering through its "directed share program." This could result in individual investors, retail or otherwise, constituting a larger proportion of the investors participating in this offering than is typical for an initial public offering. In December 2023, Reddit had an average of more than 60,000 daily active moderators.

The company cautioned that these factors may lead to fluctuations in the market value of our Class A common stock.

Reddit stated that its daily active unique user numbers may fluctuate or decrease in one or more markets due to various factors.

Although we observed growth in our user base during the COVID-19 pandemic, our DAUq growth declined and continued to decline as the pandemic's effects subsided. Additionally, DAUq has decreased in the past following usage peaks surrounding global events, such as the conflict between Russia and Ukraine, and cultural trends, including video game releases like Elden Ring and traffic related to r/wallstreetbets.

In December 2021, Reddit filed a confidential draft of its public offering prospectus with the Securities and Exchange Commission. As of December 31, 2023, the company had an employee headcount of 2,013, up from 1,942 the previous year.

Reddit, a social news aggregation and discussion website, has raised approximately $1.3 billion in funding and is valued at $10 billion, according to PitchBook. The company was acquired by publishing giant Condé Nast in 2006 and spun out from its parent company, Advance Magazine Publishers, in 2011.

Tencent and Sam Altman, CEO of startup OpenAI, are among the notable shareholders of Advance, which currently owns 34% of voting power.

Watch: Reddit is a litmus test for investor appetite for non-AI things.