Reddit is Officially Crashing the Russell Party, While Google Brings the Kegger…

Well, friends, our homeboy Reddit is about to get a new badge: come June 27, 2025, the unhinged forum where you can learn about quantum physics, why your cat hates you, and watch WallStreetBets collectively torch their savings… all in the same ten-minute scroll… will officially join the Russell indexes. That means index funds, pension managers, and all the other fun-hating grown-ups of finance will have to buy a chunk of the website that once saw 100k people spam “stonks” at 9AM on a Tuesday. Bigly. 

(Source: Giphy) 

In short, FTSE Russell, the high priests of the index’s math, dropped the preliminary list on May 23… and while it may sound boring to some (you’re not wrong)... for Reddit, it’s a BFD. Thanks to its current market cap of $19.3 billion (pause for laughter), Reddit’s about to get a one-way ticket into either the Russell 1000 or 2000, depending on where the dice land for market cap rankings. Either way, it’s joining the Russell 3000, so get ready for even more robots aggressively propping up the price with all the newfound index fund cash. (Or yanking it down, if that’s your kink.)

(Source: Investing.com) 

As for Reddit’s overall health of a business, the numbers look… insane. Gross profit margin: 90.82%. Revenue growth: 64.12% the last twelve months. The current ratio is sitting at 12.46, which means they are legit cash rich. However, there is one dangling problem that’s recently kneecapped hopium surrounding Snoo’s feral cesspool. The problem? Google. More specifically, it’s their new “AI Mode” that’s set to spoon-feed users Reddit’s wisdom (and sh*tposting) directly in the search results that way the regulars never have to click through.

Translation: Imagine spending two decades building a traffic empire and then Sundar Pichai shows up and says, “Cool forum. Mind if I siphon off your users?”. Reddit’s stock already took a 5% nosedive after Wells Fargo warned traffic might fall off a cliff, and February saw a 15% drop when Google last played with the algorithm. So it’s safe to say that every time Larry Page’s brain child twitches, Reddit investors start sweating profusely. 

(Source: Business Insider) 

Of course, Reddit management says it’s fine, everything’s fine as the “true core” is logged-in users, who bring the engagement, the memes, the drama, and lucrative ad impressions. COO Jen Wong basically told investors lurkers can kick rocks as the real money is in the people who forgot to touch grass years ago LOL. (We all know that’s true). But even still, just to hedge from complete annihilation, Reddit is rolling out its own AI search tool to battle Sundar. Whether it works or not, remains to be seen. 

(Source: Giphy)

But alas, the real story is that Reddit got inducted into the Russell big leagues, just as Google threatens to suck all the oxygen out of the room. I give it six months before “Are index funds bullish on cat memes?” is a real CNBC headline. All jokes aside, keep your eyes on this story going forward and place your bets accordingly ($RDDT is currently trending 1.20% on the day). Until next time, friends… 

Stocks.News holds positions in Google as mentioned in the article.