A dummy that's learning
Joined July 2023
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Fool's Edge retweeted
$RDDT Summary and Thoughts on Q3'2026
The user news
- US DAU down 4.7% sequentially
- DAU could fall around 10-12% (low double digit) in Q4 from Google traffic
- Around 80% of monetization comes from direct/logged-in traffic.
If logged-out traffic drives roughly 20% of revenue, a 10% decline in that traffic would mean roughly 2% less revenue.
Numbers for Q3 are:
- Revenue up 53% YoY
- Net income up 74% YoY
- P/E of 21.8
- Q4 user headwind would be about 2% less revenue
A 2% revenue headwind against 53% growth is relatively small.
The question the market has is: Does Reddit keep its direct user base with less referral traffic?
For Reddit, it's an unknown. We don't get that answer except one quarterly report at a time.
It's up to each investor to decide how much of a risk penalty to assign to less referral traffic. From a revenue/net income perspective, there is minimal penalty this year, next, or the year after. They also have all that time to find new ways to generate more revenue/users/etc... or for DAU to find a base with referral and direct.
Fool's Edge retweeted
it’s supposed to be hard. you want the outcome but you want it to be comfortable and easy and it just doesn't work like that. anything worth having is going to take a lot out of you. that’s the point. there will be obstacles. you will be tired. if you could get it without being entirely exhausted, everyone would be great. look around. they aren't.
Fool's Edge retweeted
The older I get, the more I realize that life has windows. Windows to take that big risk. To go all-in and build the thing. To chase that person you love. To spend time with your parents and kids. To go on crazy adventures. To do physically challenging things. Some windows reopen. But many don’t. A beautiful life is built by simply having the courage to dive through when you see them open in front of you.
Fool's Edge retweeted
Funny how trading ends up teaching you more about life than the charts ever could.
It’s supposed to be numbers and patterns, probabilities and edge.
But what you really find is a mirror.
We sabotage ourselves because we chase feelings instead of following plans.
Trading is just a concentrated version of life.
All your weaknesses exposed.
All your strengths tested.
Fix them here, and you’re not just building a trading account.
You’re building a life account that compounds even more.
Fool's Edge retweeted
The greatest threat to a man is comfort and coasting.
It'll find you when you think you're worthless and think settling is okay. It will find you when you think you've made it. It will find you when you think you're old enough and deserve to rest.
We aren't here to be comfortable. The challenge is the point, and the greatest discomfort you will ever find is when you try to avoid it.
BUT...The highest level of nirvana you will ever achieve is when you openly embrace it, fight your lower self and become who you SHOULD be.
You can rest when your dead and that's a good thing.
Fool's Edge retweeted
I know which expert call transcript he’s referring to because I’ve also read it multiple times. There are a several other expert call transcripts and they basically say the same thing so I’ll summarize them together…
- These person doing the expert calls do have relevant, timely knowledge of the Google / Reddit data licensing deal with at least one of them working on the first deal which expires in early 2027.
- They are highly confident this new deal gets done (and soon), it’s just taking longer than expected because it’s more complex than the first licensing deal.
- They think this new deal could be ~5 years long so it’s important to get it right.
- They think this next deal comes with an annual licensing fee plus a usage/dynamic fee based on either api calls and/or citations
- They think there will be a referral fee for Google if a source citation/link leads to a new user, app download, etc.
- They think once the Google deal gets done it will put more pressure on OpenAi and Anthropic however each deal will look slightly different but each deal will include the two fees.
- They said Reddit data is extremely valuable to LLMs because it’s millions of real time conversations, opinions and answers on thousands of topics that have been upvoted/downvoted by a community. Accessible data like this does not exist anywhere else on the internet because Meta and Twitter (X) are walled off to other LLMs.
I think there’s a very good chance this Google / Reddit licensing deal gets done in Q3.
I know that Steve Huffman was in the Hamptons this weekend, hopefully he’s back at work this morning and making this new deal a top priority.
NFA.
DYOR.
I recently got my hands on a transcript that includes people with intimate knowledge of the Google $GOOG & Reddit $RDDT data licensing negotiations….
They said something that every $RDDT shareholder needs to read.
The deal is coming. And it’s going to be dramatically larger than anything the market is currently pricing.
“Reddit is extremely valuable to Google. It’s one of the most critical assets for both Search and Gemini in terms of the data.”
“When I think of Reddit, it is real-time news. It’s real-time feedback. It’s actual humans who are going on this platform to write reviews, to give feedback. It’s a continuous feedback loop.”
On the pricing premium Reddit commands versus standard data:
“Reddit’s data is priced at a staggering premium versus the industry standard. Standard API data is $0.24 per 1,000 API calls. For Reddit, I would times that by 50x to 500x depending on what data we are talking about on Reddit. It is 500 times more the average. There is such a big markup for Reddit.”
500* times the average API pricing. They explained exactly why:
“Reddit isn’t selling data. It’s selling legal immunity because you’re forging an exclusive access. You’re signing a very legal-friendly agreement where both parties have agreed to it for Google to access the largest public archive of human conversation literally on Earth.”
On the new deal structure:
“Reddit will not accept another flat-fee structure. They’ve made that very clear. What they really want is a usage-based metered pricing structure. Under a more dynamic model, Reddit would be compensated by Google based on API volume — the raw amount of real-time data that Google draws down to train and refresh its live language models. They don’t just want Google to pay a premium on the agreement, they actually want a variable kicker tied to how often Reddit content is displayed or synthesized directly inside Google AI Overviews.”
Two separate payment streams. Training data.
Plus a premium every single time Reddit content appears in AI Overviews. On a platform where Reddit appears in 90% of conversational queries.
On the projected new deal value:
“For the Google agreement, a usage-based model would realistically lift Reddit’s payout from the $60 million back in 2024 to anywhere between $150 million to $200 million per year. That’s also a yearly payment over three years. That’s $600 million over three years, which is a lot of money, and probably the highest data licensing agreement ever to take place.”
Wells Fargo has publicly projected $550 million across all combined licensing deals upon renegotiation. Insiders are saying the Google deal alone could be worth $600 million over three years. Before OpenAI renews. Before Anthropic settles the lawsuit and signs. Before Perplexity settles and signs.
On Anthropic and Perplexity specifically:
“I’ll be very surprised if they don’t settle and end up paying Reddit. I’m actually waiting for the news headline to come out that they’ve settled and they’re forging a deal.”
There’s an incentive on both ends to get this deal signed quicker.
“On Google’s end, they want to lock in this deal ASAP because if they keep this ongoing for too long, another competitor can come in and give Reddit a more compelling offer.”
Reddit currently generates approximately $130 million annually from Google and OpenAI combined. The insiders are describing a new Google deal worth $150-200 million per year alone, before the OpenAI renewal, before Anthropic settles, before Perplexity settles, before any new licensing partner signs.
If those four things happen, the data licensing business could realistically reach $400-600 million annually from a standing start of $130 million. At 90%+ margins.
On top of an advertising business already growing 61% with 91.5% gross margins.
$805 million in Q2 revenue. 514 million weekly active users crossing half a billion for the first time. $2.8 billion in cash. $1.25 EPS up 178% year over year…
Fool's Edge retweeted
A reminder from The Subtle Art of Not Giving a F*ck by Mark Manson:
“Happiness comes from solving problems. The keyword here is "solving." If you're avoiding your problems or feel like you don't have any problems, then you're going to make yourself miserable. If you feel like you have problems that you can't solve, you will likewise make yourself miserable. The secret sauce is in the solving of the problems, not in not having problems in the first place. To be happy we need something to solve. Happiness is therefore a form of action; it's an activity.”
Fool's Edge retweeted
At ~$235 and ~28x earnings, Amazon $AMZN is trading at its lowest valuation ever.
Yes, ever.
Fool's Edge retweeted
The two most important goals of a man.
1) Earn JUST enough money to not give a fuck.
2) Find the big passion you'd chase. Daily. For the rest of your life if you didn't give a fuck about money.
Then do that. It's over. You've won. GG. 🤜🤛
Fool's Edge retweeted
Many times on X, I receive angry messages, sarcastic comments, or people trying to provoke me.
Usually, when someone writes these things, they are carrying pain inside themselves.
Maybe they lost money.
Maybe they have family problems.
Maybe life simply became too heavy.
Life gives all of us many opportunities to become angry, so I understand it.
Today, after a meditation session I had with a few Buddhist monks that come to lead a meditation session every couple of weeks, one of the monks told us a beautiful story that somehow connected deeply with this:
-The Buddha and the Angry Man-
One day, while the Buddha was walking with his disciples, a furious man rushed toward him.
His face was burning with anger.
His words were harsh and full of bitterness.
He shouted, insulted, and tried again and again to provoke him.
The disciples became upset.
Some stepped forward and asked Buddha for permission to send the man away.
But the Buddha remained calm…
silent…
unmoved, like a deep lake that stays still even when the wind blows across its surface.
The man kept shouting until he had no strength left.
And when silence finally fell, the Buddha gently asked him:
“My friend, if someone offers you a gift, and you do not accept it… who does the gift belong to?”
The man, surprised by the question, replied,
“It belongs to the one who offered it.”
The Buddha smiled and said:
“In the same way, you came here to offer me anger, insults, and hatred.
But I do not accept them.
So they remain with you… not with me.”
The man stood speechless.
For the first time, he saw the truth clearly:
Anger has no power…
unless you chooses to receive it.
My takeaway from this,
Not every insult deserves a response.
Not every argument deserves your energy.
Sometimes the strongest thing you can do
is remain calm and walk away with your peace.
Let others keep their anger.
You keep your peace.
🤖 Made with AI
Fool's Edge retweeted
My friends dad dedicated 30 years to Microsoft, steadily climbing the ranks until he became a VP of Sales.
That success came with sleepless nights, constant travel, time away from his family, and relentless quota pressure...but it paid well.
He was earning $1M+ a year.
In 2023, he finally retired to enjoy the wealth he had worked so hard for.
Two months later, he died of a heart attack.
Don’t delay living your life for a future that isn’t guaranteed.
And don’t trade time with the people you love for a paycheck.
Fool's Edge retweeted
Forward returns for Bitcoin $BTC after Short/Long Term Holder in Profit is under 8
Fool's Edge retweeted
You’re right, I missed $CORZ. Thanks for pointing it out, and appreciate others like @cazenove_uk for that too.
Should just treat it as standalone now given $CRWV merger got terminated the other day, don’t know how it slipped my mind. I’ll add that in the next 2/2 post.
$8.7 billion colo with $CRWV over 12 years gives $CORZ more predictable cashflows, and majority of capex ~80% ($~196m/ $244.5 million Q3) or so was funded by Coreweave, which is a lot nicer of a model for shareholders than convertible debt or toxic debt interest cutting into margins.
Also, with ~1.3-1.5 GW capacity, Coreweave only taking up 500 MW, and revenue offsetting capex, it’s quite interesting.
Fool's Edge retweeted
$CCCM SPAC deal should be a wake-up call for the rest of the SPAC sponsors that they can’t get away with just buying Bitcoin, put it in a structure at 2x NAV and expect to be paid!
Get some REAL deals done!
Otherwise go back to the gutters you crawled out from 🥹👋🏻
