By Roman Aglaganov
Reddit has become one of the most visible victims of AI search. In its third-quarter results on 29 October, the company said its search referral traffic was “down meaningfully” and that in October, search traffic “dropped by more than 1 million referrals on average per week.”
Blaming AI Mode
On the earnings call, chief executive Steve Huffman put much of the blame on the AI answers Google now shows. “The reality is, AI Mode does not drive traffic,” he said, according to The Verge. “Not for us, and not to anybody, as far as I know.” He said AI Overviews and AI Mode at a minimum push everyone down the search page, and that Reddit is still a top search term on Google and is being crawled “as hard as ever”.
Google sees AI Mode differently. Its chief business officer, Philipp Schindler, told investors a day earlier that “the majority of AI Mode queries are incremental”, meaning they are searches people would not otherwise have made. But Google also admitted that ads in AI Mode earn less than ordinary search ads, which slowed its search revenue growth.
The numbers
Reddit’s business is still growing. Revenue rose 53% from a year earlier to $895 million, and daily active users rose 12% to 130.3 million. But US daily users fell 2% to 50.7 million, and Reddit warned that if the search trend continues, total daily users could fall by a low double-digit percentage in the fourth quarter.
Logging in
Reddit’s answer is to make itself a destination rather than a search result. It says “a key piece of work to retain new audiences is shifting Reddit to a logged-in-only experience.” It will start testing that in some markets outside the US this quarter. Reddit argues that logged-in users engage more and give it better signals for advertising, and that the change “allows us to protect access to Reddit’s extremely valuable corpus of data”: its archive of posts and comments.
For readers, that means the open, logged-out Reddit that turns up in search results may not last. For the wider web, it is another sign of the same pattern: as AI answers keep visitors on the search page, sites with valuable content are putting it behind a login.
