Reddit Shares Fall 30% as Google AI Search Cuts Referral Traffic

Reddit’s stock dropped 30.44% to $90.15 after CEO Steve Huffman warned that Google’s AI‑powered search features are siphoning off more than one million weekly referrals, potentially shrinking Reddit’s daily active user base by a low double‑digit percentage in Q4. The company’s Q3 revenue rose 53% to $895 million, but its fourth‑quarter revenue outlook of $1.0‑$1.03 billion fell short of the $1.05 billion consensus. While Q3 advertising revenue grew 54% to $847 million, daily active users hit 130.3 million—12% YoY but below the 134 million analysts expected, and a 2% decline in the U.S. market. Huffman cited Google’s AI Overviews and AI Mode, which deliver answers directly in search results, as the main driver of the traffic loss.