Reddit shares decline following strong NYSE debut

Reddit shares: The highly anticipated debut of social media platform Reddit on the New York Stock Exchange saw its shares dip by 2.6 per cent before the opening bell on Friday. The decline comes a day after the company saw 48 per cent gain in its initial public offering (IPO).

Investors closely monitored Reddit's share sale for insights into market appetite for new offerings, particularly following a recent slowdown in IPO activity. Analysts suggest that the performance of Reddit's stock in the coming weeks may influence the IPO plans of other tech startups, especially those yet to turn a profit.

Despite Reddit's lack of annual profitability since its inception in 2005, the company received a positive reception from investors on Thursday, leading to a valuation of $9.52 billion by the end of the trading session.

Prominent investor Cathie Wood's ARK Invest also displayed confidence in Reddit by purchasing nearly 10,000 shares of the company on Thursday, according to an email from the asset manager.

However, discussions on Reddit's own forums have revealed some scepticism among users, despite the platform's popularity among retail traders during the "meme-stock" frenzy of 2021. Recent threads on Reddit's largest stock trading forums have focused on the company's lack of profitability, with some users even considering bearish options strategies, such as buying put options, on the stock.

(With Reuters inputs)