(Reuters) - Reddit ( RDDT ) forecast third-quarter revenue above Wall Street estimates on Tuesday, a sign that a recovering digital ad market would draw new advertisers to the social media platform.

The company said it expects third-quarter revenue to be between $290 million and $310 million, compared with analysts' average estimate of $278.7 million, according to LSEG data.

The results, the company's second after Reddit ( RDDT ) went public in March, follows bigger rival Meta's upbeat second-quarter revenue and rosy sales forecast, driven by robust digital-ad spending.

The earnings also fan optimism that Reddit's ( RDDT ) content licensing deals with Alphabet's Google and Microsoft-backed OpenAI are paying off despite a fiercely competitive social media market, as it looks to diversify its revenue streams.

Reddit ( RDDT ) also signed deals with sports leagues, including the National Basketball Association and the National Football League in July, to attract a loyal sports audience and in turn create opportunities for advertisers.

The company's daily active unique visitors increased 51%, to 91.2 million, in the second quarter ended June 30.