Reddit reported a quarterly profit for the first time in its 20-year history on Tuesday. Shares of the company, known for its user-led communities known as subreddits, rose more than 35% when markets opened the next day.

The company reported nearly 100 million monthly users, a 47% increase from a year earlier, and a profit of $29.9 million. Revenue reached $348.4 million, up 68% year-over-year and significantly beating analysts' expectations.

CEO Steve Huffman said the site's new feature, which uses artificial intelligence to translate English posts into French, Spanish, Portuguese, Italian and German, drove the increase in users. According to Huffman's letter to shareholders, Reddit plans to expand the feature to additional languages ​​in the coming months.

The company forecast revenue above Wall Street estimates for the current quarter, helped by its AI content licensing deals and heavy digital advertising spending.

The company's content licensing deals with Alphabet's Google and Microsoft-backed OpenAI for training its AI models have also boosted revenue, analysts said. The social media platform also has deals with sports leagues like the National Basketball Association (NBA), helping the company bring more sports content to the platform and attract advertising dollars.

“Reddit's AI partnerships with Google and OpenAI are a huge bonus right now, and while they contributed a lot to this quarter's revenue, they are like training wheels on a bicycle – good for stability, but they won't be fuel in the long run “Deliver growth,” said Jeremy Goldman, senior director of briefings at Emarketer.