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.
Alright is there anyone here voluntarily? Or did we all just end up here because we kept getting banned?
For me it became too much. I got so tired of the masked adverts. The tell me about what place to buy this bullshit. The last straw was realizing that I started to doom scroll (cooking videos) on facebook instead of using reddit. Getting down voted with no interaction is stupid. There's no secret santa, little to no interaction. It's the biggest ghost town. So yeah I'm here voluntarily, came here all the way from digg.
I never got banned. I just hated that they killed out old.reddit for logged out users since I lurked most of the time and can't stand the new UI.
And I refused to ever install or use their app. I like that the fediverse has a lot of third party apps like Summit which I'm using.
When I use reddit these days I visit it through a redlib instance like https://redlib.catsarch.com/ or https://redlib.blueberry.reallyaweso.me/
My old accounts never got banned (I think I have three still usable ones). I have one that was newer that was shadowbanned, but I never really posted anything (it was shadowbanned right out the gate from what I could tell because I used a VPN and a temp e-mail - remember the time you didn't need an e-mail?!).
I came here simply because I want a better alternative (and to get away from fascist shitheads). Unfortunately, there's really no engagement for most things here I used reddit for, but where there is, it's mostly a nicer community (because it's much smaller on here, plus less power tripping reddit mods).
Also, I can't use new reddit. It's awful. I tried again yesterday, and it sucked. The death of old reddit was always going to force me to jump ship. Although I mostly used it for lurking these days with my shadowbanned account, or through websearches for very specific things (old TV episode discussions for instance). Very rarely I log in to an unbanned account and answer a question in a niche sub of mine.
I could still go there if I wanted to play footsie with fascists, bots, and incels.
I left because they killed the app that I paid for and I'm stubborn AF.