Reddit announced earnings late last week and it boggles me how people love this stock. I am not a financial expert of analysis but Reddit has been saying for some time that 50% of its traffic comes from Google Search. Reddit also said on this Q3 earnings call that its search traffic is flat and that AI is not a traffic driver, at least not yet.
I mean, the CNBC report was super positive, it wrote, "Reddit’s sales jumped 68% year-over-year in the third quarter, while net income was $163 million, which was $133 million more than the $30 million it logged the previous year during the same period." The stock was up a lot since then.
But again, there are a lot of concerning things about Reddit and its dependency on external traffic sources. In particular, Google Search. Yes, Google has a deal with Reddit, but that deal can go away and it is unclear how long the deal with last.
Steven Huffman confirmed in the earnings call that approximately 50% of its traffic is direct and the other 50% comes from Google. We saw where Google sent Wikipedia tons of its traffic, then before that we had Yahoo Answers, before that, someone else. I mean, these are trends that change over time.
He also said that, "External search was basically flat. Of course, that can ebb and flow." Meaning, Google Search is not sending Reddit more traffic than it was previously? I mean, the growth there has stalled?
So maybe AI is driving more traffic? Nope. Steven Huffman said, "Second question on traffic from chatbots. They're not a traffic driver today."
You can read all of this in the earnings call transcript.
I know Reddit is doing what it can to hold on to the traffic it is given from Google and that is smart. Again, it just worries me how depedent Reddit is on Google. And if your site is this dependent on Google, you should look to diversify, like you all have noticed over the years.
Here are some threads on this:
— Barry Schwartz (@rustybrick) October 31, 2025
Although Reddit's CEO said "External search was basically flat" https://t.co/I6twLUjk9L pic.twitter.com/oEsMU7r5mw
— Barry Schwartz (@rustybrick) October 31, 2025
Forum discussion at X.
