Oct 30 (Reuters) - Reddit shares tumbled 29% on Friday, marking their biggest single-day drop and hitting their lowest level in over a year, after the company warned that Google’s AI-powered search was hurting referral traffic and could shrink its user base.
The online discussion platform still appears in Google search results but is attracting fewer clicks, as users increasingly rely on the tech giant’s AI tools for direct answers.
“When more than a million search referrals a week disappear because Google’s AI answers the question itself, investors are no longer looking just at the next three or four months, but at how much of Reddit’s audience it will really own in the years ahead,” said Vitor Madeira, senior market specialist at Capital.com.
Reddit warned that its daily active unique visitors could fall by a low double-digit percentage in the fourth quarter if referral traffic kept declining.
If current losses hold, Reddit is set to lose more than $7 billion in market value and Pinterest about $900 million. The two stocks have fallen about 44% and 23%, respectively, this year through their last close.
Reddit has a 12-month forward price-to-earnings ratio of 19.03, compared with Snap’s 7.53 and Pinterest’s 8.48, according to LSEG data.
Separately, Reddit on Friday said it has extended its cloud services agreement with Google through 2029, committing to spend $580 million over three years.
At least 11 brokerages cut their price targets on Reddit, and at least 13 did so on Pinterest.
Oh no, hope Spez still has money to maintain a cadre of slaves on a billionaire island (since he’s a natural leader and everything)
Gosh. You mean making it harder and harder to access their platform without giving up anonymity is hurting their business model? Well jack me off and call me Betty. When will it all make sense.
You’re already paying for the hour Betty. "It’s $10 for a BJ, $12 for an HJ, $15 for a ZJ.
Shit honey - for you I’ll hit the stopwatch.
: D
If you have to ask big man, you can’t afford it
Whats the point to appear in google search, when you gonna lock your platform to have accounts to view the content… Just asking.
Hey, its rude to expect spaz to think that far
Reddit’s failure was inevitable; once capital exerts excessive control, it’s time for people to leave. Everyone has surely had the infuriating experience of being bombarded by trashy ads on Reddit often with no human customer support available to address complaints. It has become a hub overrun by bots and scams; when you enter a subreddit, almost everything you see is just bots.
They also don’t let people lurk anymore.
We really do need to get back to a tech landscape where evil ceos are shunned and their products not used. We have tolerated the spez, musk, thiel, zuckerburg, ellison, bankman-fried, elizabeth holmes, Kalanich (uber), baszuskis (roblox) types for way too long. They are all a bunch of mega pricks and their companies should pay a penalty for their being openly evil.
Good. Let it burn to the ground
Fuck you u/spez. Fucking usurper.
Maybe if you’re worried about decreasing traffic don’t require an account just to read something on the internet.
they hurt thier own traffic by banning users, and the people who use accounts to earn money through the site or OF in general, and not the propaganda bots.
Good.
I enjoyed pre-COVID Reddit, where you could find all political stripes and religions, a virtual “melting pot”.
Today? It’s like Lemmy but with advertising. So much more homogeneous, and the moderators are deranged. Let them rule their dying empire with furry fists, have at it, it’s yours now
Reminded now, right before I left Reddit I was banned from r/pics for being a member somewhere that they don’t approve of, I can no longer recall which sub but it was lightly Republican flavored (my favorite political adversaries).
Why would they care? How would they know what the sub was intolerable without joining themselves? Why didn’t they ban themselves then? They were despoiled, like me.
Senseless. I haven’t visited since the login requirement, piss off
Today? It’s like Lemmy but with advertising. So much more homogeneous
Might have been a while since you visited it then, it’s getting increasingly absurdly right wing - mostly bots I’m guessing. Pretty much all of the main /r/all subs
Yep. Recently there was a post about the UK looking at raising the minimum wage to about £13.20 (17.50USD) an hour. On reddit it was endless comments complaining that minimum wage is too high. Most unhinged take I saw was that this will make the cost of living worse.
Yeah I haven’t been there for a couple of years. When I left it was a Democratic stronghold that had banned The Donald. Not as hard left as Lemmy, but close.
My ideal place would be “neutral” with all flavors, but I haven’t found anything like old Reddit yet, so I am taking a sabbatical here for as long as I am tolerated (probably another week)
Your posts here get banned for anti muslim hatred and terroristic zionism. Hopefully it wont take a whole week for a siteban for people like you.
The moderators on Reddit have been a pain for a long time. Here was always so much drama
It’s like Lemmy but with advertising.
Especially compared to https://old.lemmy.world/
reddit is basically nothing but a less featured facebook at this point. theyve killed and stifled real news and genuine discussion. all it is anymore is memes and gooner material.
It’s a pseudonymous Facebook. I still think that the Internet is better when people aren’t using their own real names.
To be fair, I’ve always used a fake identity on Facebook since 2010 or so. At least until I got bored of the slop and quit for good, of course.
I was Pabst Blue Ribbon, from Fucking, Austria on facebook for years. There were multiples, but I had the best banner and profile picture, not at all affiliated with the brand, just a drunk ass college student with extra time to do shenanigans. That type of shenanigans bullshit was good internet.
well. i would agree and disagree with that. when people are using real names they tend to be more civil but also they can be less honest. Its a double edged sword.
It’s still surprising to me that 2 years later, it’s still double the value it was when it went public.
There was never any believable story where they would go public and become profitable.
“a low double-digit percentage“ sure is a funny way to say 10-49%, and that since it represents fully 40% of the possible values (also known as ”a low double-digit percent”) it is a worthless non statement.
Listen to some of their q3 earnings report if youre bored. Its obvious this little forum admin spez is way out of his depth/ competence
70 to go!
Don’t listen to them Reddit!
They just want to stop you WINNING - keep going where you’re going.
Reddit is set to lose more than $7 billion in market value
Good.
“When more than a million search referrals a week disappear because Google’s AI answers the question itself,
investors are no longer looking just at the next three or four months, but at how much of Reddit’s audience it will really own in the years ahead,”
said Vitor Madeira, senior market specialist at Capital.com.
Personally I am glad investors are worried they wont own enough users.
Also, didn’t Reddit close up and start charging for their API because of this exact issue and related AI stuff? Spez is now mad that there are effects from what they implemented?
I mean, what else were they expecting when they exchanged money for API access to a search engine that explicitly pushed their AI “answer” feature? I’m bewildered at how so many companies complain about not being able to see the consequences of their own actions that were told to their face would happen.
At this point there is no way this isn’t intentional from the start.
Reddit used to be a great free to use information source and community creation tool.
It was counter to the commoditization of both.
It was inevitable that capital interests would destroy it.
