Reddit

Reddit shares fell about 30% after the company issued weak fourth-quarter sales guidance of $1.00–1.03 billion, below analysts' $1.05 billion estimate. The company beat Q3 revenue and earnings and reported 53% year-over-year sales growth, but growth slowed versus prior quarters. Reddit said it will test requiring users to log in to view content after reporting a meaningful drop in search-referral traffic from Google tied to AI, and several analysts downgraded the stock on rising monetization and user-growth uncertainty. » More on cnbc.com

Reddit reported—for the first time since its IPO—a decline in daily active US users to 50.7 million, while global growth is slowing. Revenue rose 53% in Q3 to $895 million and adjusted EBITDA was $402 million, but the outlooked EBITDA for Q4 fell short of expectations. CEO Steve Huffman blamed declining Google search traffic and Google’s AI search; Reddit plans to make most content accessible only after login, which could boost monetization but harm reach and user acquisition. Analysts have adjusted ratings and cut price targets, remaining mixed on median targets; the outcome of the login tests and stabilization of search traffic will be decisive. » More on finanzen.net

Reddit reported a decline in search referrals—more than 1 million fewer weekly referrals on average in October—and CEO Steve Huffman attributed part of the drop to Google’s AI Mode and AI Overviews, which he says do not drive traffic and push sites down search results. Huffman added Reddit remains a top Google search term but sees lower rankings for machine-translated content outside the US. To counter reduced search traffic, Reddit is building direct engagement with features like a personalized “For You” feed, AI-generated short videos, and a plan to require logins to improve user experience and ad performance. » More on theverge.com