What’s going on here?

Reddit became the talk of the town after posting strong sales in its first report since going public.

What does this mean?

Today’s endless chatter on Reddit may just be about, well, Reddit. The social media site might’ve had a bumper $748 million initial public offering (IPO) in March – but since then, investors have worried about non-existent profit and a potentially overinflated valuation. These results might’ve calmed their nerves: daily active users jumped 37% over the last year, calming fears about waning popularity, while revenue was up a better-than-expected 48%. Mind you, Reddit still made a loss – although it wasn’t quite as bad as feared, with a lot of the costs related to its IPO. What’s more, Reddit hinted at an adjusted profit of $10 million, so there’s hope yet for those betting on the company’s success.

Why should I care?

For markets: AI, AI, AI.

Hardly any tech companies have seen returns from their investments in the AI space so far. Reddit is an exception. One of its shiny new revenue streams is licensing its treasure trove of data to AI firms: the company boasts an archive of 18 years of endless chat – a gold mine for language models. Reddit has already inked deals worth over $250 million spanning two to three years, bringing in $20 million in the first quarter alone.

The bigger picture: Boom or bust.

Consumers are spending money but a stark divide is emerging. The well-off – encouraged by rising investment values and tidy interest rates on their filled-up bank accounts – are splurging. Meanwhile, the cost of living crisis is snapping at the heels of the less fortunate. This hasn’t been a problem for Reddit so far: it relies more on money from ads than users. Of course, that could be tested if the economy starts affecting a larger share of the population, potentially encouraging companies to cut back on ad spending.

What’s going on here?

A study showed the share of electricity generated from renewables hit an all-time high last year, but there’s still work to be done.

What does this mean?

Beachgoers might’ve appreciated the early arrival of summer, but April marked the 11th consecutive month of record-breaking heat. So now, it’s more important than ever to cut fossil fuel use in the power industry – by far the biggest contributor to global carbon dioxide emissions. At least we’re making progress: a new study from think tank Ember showed that renewable sources provided a record 30.3% of global electricity last year, up from 29.4% in 2022, with green energy generation growing at a faster rate than that of fossil fuels. The widespread build-out of solar farms in the past few years has spurred that on, after an oversupply of Chinese solar panels led to a big drop in prices. That’s helping to put a global target of tripling renewable capacity by 2030 within sight, according to Ember.

Why should I care?

The bigger picture: Hot on the heels.

Building new renewable energy plants isn’t just a matter of saving the world: global demand for electricity is set to accelerate in the coming years as data centers, crypto miners, and EVs become more widespread. In fact, the International Energy Agency projects that global power demand for data centers alone could double by 2026 to over 1,000 terawatt-hours. For context, that’s the entire annual electricity consumption of Japan.

Zooming in: A balancing act.

The issue with renewable energy, though, is that it relies on the whims of the wind and sun. But everything – from data centers to whole countries – needs a stable supply of electricity. That’s partly why G7 countries agreed last month to increase electricity storage capacity sixfold from 2022 to 2030, as countries grapple with the issue of keeping the lights on while going green.