GoKawiilReddit shares drop 30% after weak Q4 revenue forecast
Reddit's stock fell 30% Friday, its worst single-day decline since going public in 2024, after the company guided fourth-quarter sales to $1 billion-$1.03 billion, below Wall Street's $1.05 billion estimate. The forecast came despite Reddit beating expectations on Q3 earnings and revenue, which grew 53% year-over-year but at a slower pace than prior quarters. CEO Steve Huffman said search-referral traffic from Google declined significantly this quarter due to AI Overviews, and the company announced plans to test requiring logins to view content.
GoKawiil's interpretation of the reporting above, not reported fact.
The selloff suggests investors are worried that Google's AI-driven search results are cutting into the free traffic Reddit has long relied on to build its audience and ad business. Requiring logins could help Reddit capture more engaged, data-rich users for advertisers, but it also risks alienating the casual browsing audience that made the platform widely used, according to Huffman's own comments. Analyst downgrades, including from Citizens, indicate growing skepticism about Reddit's dependence on search-engine referral traffic as a business model.
- Reddit stock fell 30%, its steepest one-day drop since its 2024 IPO.
- Weak Q4 sales guidance of $1B-$1.03B missed analyst expectations despite a Q3 earnings beat.
- Reddit will test login requirements as Google's AI Overviews reduce referral traffic, prompting analyst downgrades.
Source: cnbc.com — Caleigh Keating, 2026-10-30
Published there as: “Reddit stock plunges 30% after weak outlook, heads for worst day ever”
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