Live Feeds
● LIVE Updated 1h ago · 14 sources tracked

Reddit Shares Plunge 30% After Company Says Its Q3 Search Traffic Was "Down Meaningfully"

Reddit shares plunged as much as 30% after the company disclosed that third-quarter search traffic dropped meaningfully. CEO Steve Huffman blamed Alphabet unit Google and its AI-powered search features for keeping searchers on Google instead of sending them to external platforms. Alongside the traffic decline, Reddit reported third-quarter revenue grew 53% year over year to $895 million, beating Wall Street expectations. However, the company issued a fourth-quarter revenue forecast of $1.02 billion, which fell short of analyst estimates. To combat the referral drop, the platform announced plans to shift toward a logged-in-only experience requiring users to create official accounts.

🎙️

Listen to Live Briefing

Real-time synthesized voice briefing · Live Feeds Desk

⏱ ~3 min
Speed:
RSS Source map (14)
⚡ Key Developments & Real-Time Context
Text size:
  • ✓ Reddit stock plummeted between 29% and 30% following the company's third-quarter earnings and traffic disclosures.
  • ✓ CEO Steve Huffman blamed Google's AI-powered search features for eroding organic search traffic.
  • ✓ Reddit reported third-quarter revenue rose 53% year over year to $895 million.
  • ✓ Reddit's fourth-quarter revenue guidance of $1.02 billion missed analyst estimates.
🛡️ Source Corroboration: 14 independent reporting domains (100% confidence) ⏱ Read time: ~3 min

What changed

Reddit suffered its worst trading day ever, falling up to 30% after linking a drop in search traffic to Google AI features and issuing a soft fourth-quarter revenue forecast.

Live updates

  1. Reddit Shares Sinks 30% Following Traffic Drop and Weak Forecast

    Reddit shares plunged as much as 30% after the company disclosed that third-quarter search traffic dropped meaningfully. CEO Steve Huffman blamed Alphabet unit Google and its AI-powered search features for keeping searchers on Google instead of sending them to external platforms. Alongside the traffic decline, Reddit reported third-quarter revenue grew 53% year over year to $895 million, beating Wall Street expectations. However, the company issued a fourth-quarter revenue forecast of $1.02 billion, which fell short of analyst estimates. To combat the referral drop, the platform announced plans to shift toward a logged-in-only experience requiring users to create official accounts.

    Why it matters

    The steep sell-off reflects growing anxieties across the broader internet economy regarding how artificial intelligence features deployed by search giants impact organic web traffic and referral models. Platforms that traditionally relied heavily on search engines to drive inbound clicks face mounting pressures to capture direct user loyalty and engagement. Reddit experienced weekly Google search referrals falling by more than 1 million.

    What is confirmed

    • Reddit stock plummeted between 29% and 30% following the company's third-quarter earnings and traffic disclosures.
    • CEO Steve Huffman blamed Google's AI-powered search features for eroding organic search traffic.
    • Reddit reported third-quarter revenue rose 53% year over year to $895 million.
    • Reddit's fourth-quarter revenue guidance of $1.02 billion missed analyst estimates.
    • The company announced plans to transition to a logged-in-only experience requiring users to create official accounts.

    Still unconfirmed

    • Daily users could fall by a low-double-digit percentage due to the ongoing search traffic erosion.

    What to watch next

    • Implementation details and user retention metrics regarding the mandatory login requirement.
    • Further analyst revisions to tech sector valuations driven by Google AI search referral trends.
    Sources used for this update (18)
    1. CNBC — Reddit stock plunges 29% after weak outlook, wrapping its worst day ever
    2. Yahoo Tech — Adding 'Reddit' to your Google search could be a lot less useful now
    3. Reuters — Reddit shares plunge as Google's AI search squeezes traffic
    4. Ars Technica — Reddit is moving to “a logged-in-only experience,” CEO says
    5. Bloomberg.com — Reddit to Limit Access for Logged-Out Users in Strategy Shift
    6. Deadline — Reddit Shares Plunge 30% After Company Says Its Q3 Search Traffic Was "Down Meaningfully"
    7. Yahoo Finance — Reddit, Pinterest, and Roblox stocks tank after Q3 earnings
    8. Mashable — Reddit to force mandatory login as Google traffic drops
    9. Yahoo Finance — Reddit (and everyone else) faces a bleak internet without Google traffic
    10. Yahoo Finance — Why Reddit (RDDT) stock is trading lower today
    11. TweakTown — Reddit will soon force users to log in as Google search traffic drops by more than 1 million referrals a week
    12. finance.yahoo.com — RDDT Q3 deep dive: Search traffic drop and cautious guidance weigh on results
    confidence 100%
📊

Community Sentiment: How do you assess this situation?

Voice your perspective · Real-time aggregated sentiment from the Live Feeds community