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March 21 (UPI) -- Shares in the social media platform Reddit jumped 48% during their first day of trading Thursday, the first major tech stock launch in five years. Reddit began trading on the New York Stock Exchange under the symbol RDDT after pricing its shares on the high end of what was a projected range at $34 per share.
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Shares were up as much as 70% in midday trading Thursday, CNBC reported, before they settled back to close at $50.44, giving the company a market cap of about $9.5 billion.
"We did it, mom," wrote Reddit co-founder Alexis Ohanian shared a video celebrating the IPO on X.
The company offered 22,000,000 shares of Class A common stock.
Reddit was seeking a $6.5 billion valuation and had hoped to raise $748 million in new capital.
The company has struggled to achieve profitability over its 19-year lifetime, making more than $800 million in annual sales but reporting net losses of more than $90 million.
In hopes of quieting Reddit users who are opposed to the platform being taken public, the company is setting aside more than 1 million shares for some of its most passionate users, called "Redditors," at the risk of making the shares more volatile in the market.
Reddit co-founder and CEO Steve Huffman said he hopes going public offering will make the platform a stronger outlet for its users.
Reddit said it has an average of 73 million users but has never been able to turn those users into a dedicated source of profit-making. Additionally, Reddit said, complaints about negative content and culture have driven away advertisers and potential sponsors, making Reddit's financial success more challenging.
Reddit also was the primary home for "meme stock" traders in early 2021, and they sought to boost prices of stocks targeted by short sellers, including GameStop.
Pinterest was the last major tech stock to launch on the NYSE in 2019, which saw its price soar 25% from its initial offering of $19 per share.
Google has a partnership with Reddit, allowing the search giant more access to Reddit data to train AI models and improve its products.
Some say the Google deal could portend Reddit's downfall.
"If generative AI models and conversations eventually replace the need to visit the subreddits in the first place, Reddit could face the same dilemma facing other online publishers and [get] paid to accelerate their own demise," Bernstein analyst Mark Shmulik said.
