Reddit Stock Soars 48% on Debut with AI Strategy Exciting Investors

Shares of social forum giant Reddit closed its first day of trading at $50.31, up nearly 48% from its IPO price of $34 per share. Despite being unprofitable, Reddit's significant AI story, with $203 million in AI contracts, excites investors about its future. However, an FTC inquiry into Reddit's plan to license user data for AI models might impact investor sentiment. Reddit's strong IPO debut, following Astera Labs' success, suggests a potential resurgence in the tech IPO market. If the current trend continues, the IPO window could open wider in 2024. With the Nasdaq Composite reaching a new high, the market conditions seem favorable for tech shares. While past tech IPOs have had mixed results, Reddit's strong showing could inject new life into the IPO market this year.