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  • Writer's pictureRealFacts Editorial Team

Recent IPOs Reddit & Astera Labs Report Earnings

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Recent earnings releases from major companies have triggered significant fluctuations in share prices. Among these, two notable recent IPOs disclosed their inaugural earnings reports. These companies are Reddit (RDDT) and Astera Labs (ALAB). Both Astera Labs and Reddit stocks have shown remarkable volatility, with Astera Labs more than doubling since its $36 IPO price and Reddit soaring up to 120% from its IPO price since its debut on March 21st.

Reddit reported its first quarterly results after the market closed on Tuesday. Revenue exceeded expectations, while the company's loss was less severe than analysts had anticipated. Reddit recorded a loss of $8.19 per share on sales of $243 million, surpassing analysts' forecasts of a loss of $8.75 per share on sales of $214 million, according to FactSet. Additionally, Vidya Ramakrishnan, an author at Investors Business Daily, reported, “The social media platform already boasts a partnership with Google parent Alphabet (GOOGL), which is paying for access to its data to train large language models for artificial intelligence applications.” The deal with Alphabet and a positive earnings report caused the stock to surge by as much as ten percent in Wednesday’s pre-market trading. 

Astera Labs stock, on the other hand, did not perform as well during trading on Wednesday after reporting earnings. In the March quarter, the chipmaker based in Santa Clara, Calif., recorded adjusted earnings of 10 cents per share on sales of $65.3 million, surpassing analysts' expectations of 4 cents per share on sales of $56.7 million. This marked a significant improvement compared to the same period last year when Astera reported an adjusted loss of 12 cents per share on sales of $17.7 million. 

For the current quarter, Astera forecasts adjusted earnings of 11 cents per share on sales of $72.5 million, based on the midpoint of its outlook. Analysts had anticipated earnings of 6 cents per share on sales of $62.8 million. Despite this strong beat, the stock fell over 10% in intra-day trading, indicating that investors had even higher expectations for the company's future growth. These significant stock swings underscore the uncertainty that can accompany earnings season and highlight the importance of staying up to date on when companies report.

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