Reddit Shares Surge Over 8% After Launching New AI Marketing Tools at Global Event

Reddit (NYSE:RDDT) stock jumped over 8% in early Tuesday trading before slightly retreating to £100 ($135) per share after the social media company announced the launch of AI-powered marketing tools called Reddit Community Intelligence at the Cannes Lions International Festival of Creativity in France.

Trading volumes soared to above 19.6 million shares, more than double the daily average trading volume of 8.3 million shares. Reddit said that the new AI product suite is driven by an engine developed through the analysis of over 22 billion posts and comments on the social media platform to help brands make smarter marketing decisions.

Reddit Community Intelligence comprises two early-stage AI products: Reddit Insights and conversation summary add-ons.

Reddit Insights is a social listening tool backed by proprietary metadata that provides real-time insights. It is expected to help marketers effectively plan campaigns, validate creative ideas, seamlessly identify cultural insights, and monitor brand health to extract accurate data at scale and make smarter business decisions.

Meanwhile, the summary add-ons ad feature integrates positive content from Reddit users directly under an advertiser's creative. As a result, the feature integrates community conversations into the user experience. The tool appends user posts and feature summaries below advertiser creative for built-in social proof, facilitating robust performance and helping consumers make better decisions much faster.

These new AI marketing tools have been engineered to help brands tap into Reddit's authenticity and seamlessly connect with high-intent communities globally.

'The new Reddit Insights tool has revolutionised how we understand and present brand sentiment – delivering authentic, real-time insights from Reddit that go beyond mentions to reveal what people genuinely love or want improved,' said Joel Lunenfeld, US chief executive officer at Publicis Media Exchange. 'With intuitive visuals, audience discovery, and actionable analysis, it's become an indispensable asset for campaign planning, client pitches, and performance tracking. This allows teams to react quickly, find whitespace, and build deeper brand trust through community-driven intelligence.'

Reddit said that initial tests revealed that the summary add-ons feature resulted in a 19% higher click-through rate compared with standard image ads. The results also showed increased ad relevance and development of robust connections between brands and diverse communities.

'These new products are features I've wanted to build since my first day at Reddit,' said Jen Wong, chief operating officer at Reddit. 'In a world increasingly flattened by AI, the value of human content on our platform only grows. With Reddit Community Intelligence, we're not just surfacing insights and conversations; we're offering deep context, perspective, and the voice of real people at scale.'

Reddit shares have gained 18.44% in the past one month and over 122% in the past year. Multiple analysts have a 12-month average price target per share of £110 ($148.12), with some estimates going as high as £163.39 ($220) per share. Some of the analyst price targets on the lower end hovered around £55.7 ($75) per share.

Disclaimer: Our digital media content is for informational purposes only and not investment advice. Please conduct your own analysis or seek professional advice before investing. Remember, investments are subject to market risks and past performance doesn't indicate future returns.