Shares of Reddit (RDDT, Financial) dropped 4.8% upon an announcement that Chief Operating Officer Wong has unloaded most of her holdings. Wong sold 32,333 shares of Reddit's Class A Common Stock, a filing with the Security and Exchange Commission shows. The shares were sold at prices ranging from $166.74 to $179.80, totaling approximately $5.87 million.
Wong adopted the Rule 10b5-1 trading plan earlier this year, under which the transactions were conducted. Company insiders can trade stocks by selling them in a scheduled manner to avoid conflicts of interest, which is this type of prearranged trading plan. Despite the sales, Wong still owns 1,507,297 shares directly, and the MorMa Trust owns 161,000 more. In addition to her direct holdings at the end of the period, Wong exercised stock options to purchase an additional 33,333 shares at a conversion price of $5.35.
Interestingly, Reddit has been a roaring success financially, valued at $29.64 billion. The social media platform experienced a 48.7% revenue growth, its total revenue grew by 68%, and advertising revenue climbed 56% over the past year. Adjusted EBITDA for the company was $94 million, far surpassing forecasts.
Despite the stock's strong year-to-date performance, at 234%, the sale earlier this month by Wong, another early Reddit investor and corporate executive who serves as Jeff Bezos' top technology adviser, gives a window into potential insider activity with Reddit as it continues to expand into the digital media space.
