Reddit has an exceptionally low cost to scale ratio. Where are you getting the information that they're not profitable at this point (I know they weren't in the past)?
Yep, the site is still in the red. We are trying to finish the year at break-even (or slightly above, to have a margin of error) though. [1]
1: http://www.reddit.com/r/TheoryOfReddit/comments/1ihwy8/rathe...
Someday, the money will run out, and they'll have to try and turn a profit.
Their business model is fundamentally bad.
We operate a dozen of our own colos, with a virtual colo on AWS for insta-scalable multi-region redundancy, and an Amazon "colo" costs the same as about eight of our own when spun up and serving at least a gigabit of traffic.
However, the difference is less if you're going from zero sys admins to 24/7 says admins. I'd SWAG the crossover is once your AWS budget exceeds 4 full time sys admins willing to do shift work.
Being a forum where low wage/students/anti-corporate/anti-advertising types go and share memes is the elephant in the room problem.
For example, I wouldn't be surprised if the Internet's largest right-wing community turned out to be one of the subreddits.