Reddit Inc (NYSE:RDDT) is likely to deliver another quarter of solid advertising growth, according to Jefferies, as conversations with marketers point to resilient digital ad budgets and increasing share gains for the platform.
The brokerage said its latest checks with advertisers suggest Reddit’s first-quarter performance will reflect continued momentum, driven by strong returns on ad spend and growing adoption of its lower-funnel ad tools.
According to Jefferies, advertisers described digital ad budgets as holding up well in early 2026 despite broader macroeconomic uncertainty, with spending increasingly shifting away from traditional channels such as television and print toward more measurable formats.
Within digital, lower-funnel campaigns focused on conversions rather than brand awareness are growing faster, the analysts said.
Paid social platforms are emerging as a key destination for that spending, as more product searches begin directly on social media. Alongside Meta Platforms and TikTok, Reddit was cited as one of the primary beneficiaries of this shift.
Jefferies said Reddit is gaining share within social media advertising, supported by its contextual targeting capabilities and distinct user communities. Advertisers noted that the platform’s structure, built around interest-based discussions rather than viral content, helps generate more precise targeting signals.
Marketers also pointed to attractive returns on ad spend during peak periods, with Reddit’s relatively lower ad load allowing it to scale inventory more flexibly and limit cost inflation compared with peers.
By contrast, trends across other platforms were more mixed. Advertisers reported stable budgets at Meta and rising spending on TikTok, partly reflecting a rebound from disruptions earlier in 2025. However, weaker returns and more limited targeting options were cited as reasons for reduced spending on Pinterest and Snap.