Reddit Stock Plunges 30% as Google's AI Search Threatens Traffic and User Growth
Reddit said search referrals fell by more than 1 million a week in October as Google’s AI tools reduced traffic, while Pinterest missed revenue estimates.
- On Friday, October 30, 2026, Reddit and Pinterest shares fell in premarket trading after Reddit warned that Google's AI search features could shrink its user base, while Pinterest forecast weak fourth-quarter revenue.
- JPMorgan analysts said the expansion of Google's AI Overviews and AI Mode has pushed search traffic down, as these features answer queries directly without sending users to platforms like Reddit.
- Search engine referrals fell by more than 1 million on average each week in October, with Reddit set to lose $5.7 billion in market value and Pinterest facing European revenue flatness.
- To combat traffic losses, CEO Steve Huffman announced Reddit will soon require user accounts to view content, while extending cloud agreements with Amazon Web Services and Google through 2029 for $880 million and $580 million.
- The selloff fits a wider repricing of how AI reshapes search and advertising, as Reddit races to build an owned-audience model while analysts warn the near-term outlook remains clouded.
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The Economic Times
Times of IndiaReddit stock plunges 30% as Google's AI search threatens traffic and user growth
Reddit shares plunged 23% after the company warned that Google's AI powered search features were hurting referral traffic and could lead to a decline in daily active users. Pinterest also fell after issuing a weaker revenue outlook, as pressure on European cross border sellers weighed on its business and growth expectations.
Reddit shares plunged on Friday after the company warned that Google's artificial intelligence-powered search engine was significantly reducing traffic to the site. The stock fell 29 percent, the biggest one-day loss in the company's history, and the stock's value fell to its lowest level in more than a year.
24/7 Wall St.
BizTocReddit Plunges 25% as Search Traffic Slump and Soft Outlook Overshadow Earnings Beat; Snap Falls 5%, Pinterest Drops 4%, Meta Dips
Reddit beat earnings expectations by a wide margin, yet its stock cratered in morning trading as the CEO revealed a threat that no quarterly report can easily fix. The culprit sits inside Google, and Reddit's proposed solution could cost it millions of casual visitors.
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