> In 2023, the company’s revenue was $804.0 million. Research and development, at $438.3 million, was more than half, an awfully big number for a company of this age. Total costs and expenses were $944.2 million. The net loss was $90.8 million, which at least is an improvement over 2022, with its $666.7 million in revenue and $158.6 million in losses. [1] These expenditures blow my mind. But if reddit can grow revenu…
Was also shocked by those numbers. And supposedly each DAU even generates more revenue than Pinterest and Snap - what is Reddit doing to make operations that much more expensive?
You need to build out anti-bot infrastructure. Arguably whatever infrastructure they have isn't keeping up at all with new challenges, but that infrastructure is probably miles more complicated than you think, even though it doesn't do its job well enough.
And your attacker is groups of humans, some of them probably funded, all of them able to organize on other sites like 4chan and 8chan. Reddit has largely managed to deal with shit like the old nazi babytalk subreddits that used to proliferate everywhere (shit like r/FrenWorld and its "six million nosefrens who love baking" lightly coded nazi shit). That takes effort to keep it from spreading all over your platform.
And that's on the front end dealing with the users. You still have to run a company that sells ads to its actual customers and you need to support all that infrastructure as well. And the corollary to that is that you have to deal with the nazi babytalk subreddits and stamp them out because nobody wants to see that spread all over your platform and advertisers will utterly lose their shit over it -- being a "free speech absolutionist" is going to be incredibly damaging to revenue.
Everyone here also hates the redesign, but it has been wildly successful at driving numbers. Everyone here hates the way that flood of users maximizes the Eternal September of reddit even harder, but that keeps all their numbers going up and to the right. Everyone hates the shitty issues with the redesign. But that effort probably long since paid for itself. Even image and video serving is doing well enough to keep users stuck to the site better and not going to competition and not seeing more ads. Even if it sucks, that probably helped revenue.
To do that all technically better, you're probably going to have to higher more expensive developers and take even bigger hits to the bottom line rather than firing half the company and even further dropping the balls that are being juggled.
They could of course kill all the attempts at shitcoin integration and probably fire half of middle management who keeps coming up with those kinds of ideas, but that's just US management disease.
HN loves to think that any one of us could rewrite reddit in a weekend, but only if you're looking at the easy part of the job which is building a web forum. Not if you're looking at the actual requirements of building out the most popular web forum in the world (or at least western world I guess, IDK what China has internally)