Reddit puts logged in experience first as Google AI hits traffic

Reddit's CEO Steve Huffman announced plans to require users to log in for most content to prevent data scraping, a move that follows a decline in referral traffic from Google's AI-powered search features. This decision came after Huffman revealed that total daily active unique visitors to Reddit could fall by a low double-digit percentage in the fourth quarter if referral traffic continues to decline.

Search engine referrals to the platform decreased by over one million on average each week in October, marking the first decline since Reddit went public in 2024. Huffman emphasized that AI modes do not drive traffic for Reddit, as they answer user queries directly, cutting off traffic to publishers and social media firms. He cautioned that requiring users to log in creates an additional barrier to engagement, especially for casual users.

Luke Stillman, a research director at Madison and Wall, echoed concerns about the impact on user growth. Reddit licenses its data to AI startups like OpenAI and Google, but has also taken legal action against companies like Anthropic, Perplexity AI, and data scraping firms for allegedly illegally collecting Reddit's data. Despite the challenges, Reddit's 53% revenue growth slowed in the third quarter but remains better than competitors such as Snap and Pinterest.

The company's next internal target is $5 billion in revenue, with the current quarterly revenue forecast of $1.00 billion to $1.03 billion aligning with analysts' estimates. Reddit plans to test the logged-in-only experience in select markets outside the US in the fourth quarter to gauge its impact before full implementation.