Reddit reports a solid quarter but shows signs of AI’s impact
TechCrunch AI Lucas Ropek
Reddit reported 61% revenue growth and beat earnings expectations in Q2, but CEO Steve Huffman warned that search referrals grew "choppy" during the quarter, spoking investors who fear AI-powered search summaries are diverting traffic from the platform. The company's U.S. daily active users declined slightly from 53.5 million to 53.2 million quarter-over-quarter, raising concerns about logged-out traffic as search engines shift toward AI-generated answers. Investors are now questioning whether Reddit's data licensing deals with Google and OpenAI remain viable if AI search continues to cannibalize the site's referral traffic.
Why it matters
Reddit's financial situation is looking good but uncertainty about its relationship to Google and the new AI-ified web are stirring market concerns.
