If you read the subreddit stats website, you’ll see a massive disclaimer at the top that the data is inaccurate after the API change because the site owner didn’t want to pay the new rates. I think a lot of people here are overstating how much reddit has changed since the API shutoff.
The penalty is for all revenue made, not all profit made. So they still lost money on this product with R&D, production, etc. expenses.