Reddit Beats Third-Quarter Estimates but Shares Fall on Weak Guidance and Declining Google Search Traffic
Reddit (RDDT) reported third-quarter earnings and revenue that exceeded Wall Street expectations, with EPS at $1.40 against an expected $1.35 and revenue of $895 million compared to the projected $878 million. However, the company's shares fell over 7% following a fourth-quarter sales forecast that missed analyst projections. CEO Steve Huffman attributed a meaningful decline in search referral traffic from Google to the search giant's shift toward AI-driven features, which reduces outbound clicks to external sites. To mitigate this and improve monetization through targeted advertising, Reddit plans to test requiring users to log in to access the platform, starting with international markets in the fourth quarter.
Topics: earnings beat guidance miss revenue growth search referral decline user authentication policy
Part of the story Reddit Shares Plunge 29% Following Weak Earnings and Declining Search Traffic (31 articles)