r/stocks
Reddit is likely manipulating it's revenue numbers
Author alleges Reddit manipulates revenue data to show artificially low volatility post-IPO, citing historical inconsistencies and CEO's past ethical issues.
- Post-IPO quarterly revenue growth volatility is statistically anomalous compared to pre-IPO historical data.
- The consistency of ~70% YoY growth over seven quarters is deemed unrealistic for a business of this nature.
- CEO Steve Huffman's history of unethical behavior (fake accounts, editing comments) undermines trust in financial reporting.
Between 2015 and 2023, Reddit had yearly revenue growth rates of roughly 88, 67, 100, 60, 50, 57, 143, 47, and 20 percent. This averages out to 70%, with completely normal volatility.
However, ever since they IPO'ed, that volatility has vanished. The quarterly year-over-year growth rate has been sterilized into a very narrow range around 70%. Reported quarterly volatility in growth is now allegedly significantly lower than the yearly volatility before the IPO. That, of course, is complete BS.
https://imgur.com/a/reddit-faking-no-more-volatility-revenue-growth-6Rp8Feb
This is what they have reported over the last seven quarters: 69, 69, 68, 78, 62, 62, and 67 percent YoY revenue growth. There is basically a zero percent chance that revenue would grow at this high a rate with this low of a volatility over 7 quarters. It has never happened anywhere else, not even close, including Reddit pre-IPO. They are in all likelihood manipulating the numbers, smoothing them out to fake a low-volatility, high-growth business.
It would also not be the first time Huffman has been caught cheating: in 2005, he created fake accounts; in 2016, he edited user comments; and in 2023, he lied about being blackmailed by the Apollo app developer.
Breaking: as a business gets larger, its numbers get more stable and predictable. More at 11
no, there has never been a business that ever did anything even remotly close to this. not even a company that has a f.ckng subscription business that auto-raises prices ever printed a sequence like this. its FAKE
Also as a company gets large growth slows down... so growing faster and more predecitible is the issue. Too bad it seems you struggle to understand basic english
Snow: 29% 28% 27% 26% 32% 29% 30%33%
And your point is? So what?
are you dumb ? thats 28%, which isnt 70%. can you see the difference between 28% and 70 %? also, you didnt post the right set of data, of course you didnt, as they had a 22% quarter, which is a volatility of 30% compared to 33% growth. so thats in total a 5x difference to reddits BS sequence. plus snow has a consumption model thats closer to subscription type revenue, and therefore limits the volatility.
jeez. these people. nobody is capable of looking at data and thinking. they type away, and its BS 100% of the time
thats 28%, which isnt 70%. can you see the difference between 28% and 70 %? also, you didnt post the right set of data, of course you didnt, as they had a 22% quarter, which is a volatility of 30% compared to 33% growth. so thats in total a 5x difference to reddits BS sequence. plus snow has a consumption model thats closer to subscription type revenue, and therefore limits the volatility. they also never went from 70% growth with high volatility to 70% growth without volatility, as reddit allegedly did, but had a natural sequence instead.
If you're convinced of your wild thesis / and the Wirecard comparison, I wish you good luck with shorting
How about disclosing your position
what the fuck has that to do with anything. read the text, research yourself and think about it
Lol...yeah...you post every single day for months now exclusively (just look at his post history...) about how terrible Reddit stock is and now you even claim they cook their books like Wirecard. But you own some shares? What does it take to make you sell your shares? Utterly ridiculous.
If you lie you should
- make it sound reasonable
- hide your post history
- maybe not post the same stuff every single day for months
I thought the Apollo app developer misinterpreted the costs associated users and so the dev presented a case that was incorrectly calculated and so people got upset at the idea of having to pay what users were actually worth and their cost?
Okay, or... Hear me out... Or... The growth comes from increasing shady ways of monetization.
In addition to aggressive ads method, user data licensing deal is 10% of overall revenue, not alot, but this is basically pure profit.
When you're dealing with just data and advertising having 70% yoy increase isn't that impossible. What's more likely to happen, is that there is now a incentive to continuously chase that 70%, leading to more and more desperate money grab. And it will be broke when they ran out of tricks
its not about the growth rate. its about the volatility in growth thats suddenly missing. would be cool if people 1) read and then 2) think before typing random nonsense
Don't bother. Sounds like you have some sort of forensic accounting or six sigma knowledge while this sub are just mostly bootlickingnpermabulls.
What you pointed out is extremely suspicious
yes. thank you. it doesnt even need much of a forensic analysis. common sense looking at this data should suffice