Reddit saw a remarkable debut on Thursday as its shares surged by 48% in the first initial public offering (IPO) for a major social media company since Pinterest entered the market in 2019.

The 19-year-old platform, renowned for hosting countless online forums, priced its IPO at $34 a share on Wednesday, hitting the top end of the anticipated range.

Reddit and its selling shareholders garnered approximately $750 million from the offering, with the company itself raising around $519 million.

Upon its market debut, the stock opened at $47 and soared to a peak of $57.80, representing a staggering 70% increase during the day.

Ultimately, it closed at $50.44, resulting in a market capitalization of approximately $9.5 billion.

At its IPO price, Reddit held a valuation of roughly $6.5 billion, a modest decrease from its private market valuation of $10 billion in 2021, a year marked by substantial growth in the tech industry.

However, the landscape shifted in 2022, with rising interest rates and inflation prompting investors to retreat from high-risk assets, CNBC reported.

Consequently, startups responded by implementing layoffs, adjusting their valuations, and prioritizing profitability over expansion.

According to Reddit’s prospectus, its annual sales for 2023 climbed by 20% to $804 million from $666.7 million the previous year.

Additionally, the company reported a net loss of $90.8 million in 2023, significantly narrower than its loss of $158.6 million in 2022.

Written by B.C. Begley