Google's AI search cost Reddit a million referrals a week

Reddit beat third-quarter estimates — revenue up 53% to $895 million, net income $283 million — but warned that shrinking search traffic could cut its daily users by a low-double-digit percentage in the fourth quarter. Shares fell 18.2% to $106 in after-hours trading on October 29.

The company's shareholder letter, filed with the SEC, said search-referral traffic fell meaningfully in the third quarter and accelerated late in the quarter, dropping by more than 1 million referrals on average per week during October. CEO Steve Huffman blamed Google's shift to AI Mode and AI Overviews, telling investors: "AI Mode does not drive traffic."

Reddit will test a primarily logged-in experience in select markets outside the US in the fourth quarter, betting on logged-in users who already account for over 80% of its monetization. Huffman said there is no timing yet for a wider rollout — and that Google still crawls Reddit "as hard as ever."