Reddit CEO Steve Huffman said the quiet part on last night's earnings call:
"The reality is, AI Mode does not drive traffic. Not for us, and not to anybody, as far as I know. That's just a fundamental shift in how Google works. It used to be a traffic driver, now it's not."
RDDT is trading at $102.00 premarket, down 21% from Thursday's $129.60 close.
The quarter was strong. The traffic was not.
Revenue: $895 million, up 53%. Ad revenue: $847 million, up 54%
Net income: $283 million, up 74%. Adjusted EBITDA: $402 million, a 45% margin
Trailing 12-month revenue: above $3 billion
DAUq: 130.3 million, up 12%, but below the 133.7 million Wall Street expected
US DAUq: 50.7 million, down 2%. That's the first drop since Reddit went public in 2024
US logged-out DAUq: 27.3 million, down 4%
Q4 revenue guidance: $1.0 to $1.03 billion, vs. $1.05 billion expected
The number that sank the stock
In October, Google search referrals to Reddit fell by more than 1 million a week on average.
Huffman warned that if the trend holds, total DAUq could fall by a low double-digit percentage in Q4 from the current 130 million.
Meanwhile, Huffman says, "Google is crawling us as hard as ever."
Google is still reading Reddit's content. It just isn't sending users to it.
Why it's happening: 4 reasons
1. Zero-click SI answers
Google now answers the question on the results page, so fewer people click through to the site.
A preregistered field experiment on Google Search found AI Mode cut click-through to outside sites by 18.8 points. Clicks to Reddit fell 21.2 points, and clicks to news sites fell 12.5 points.
A separate randomized study found that when an AI Overview appears, organic clicks drop 39.8% and zero-click searches rise 34.5%.
Pew: people clicked a regular result on 8% of visits when an AI summary showed up, vs. 15% when it didn't. Links inside the summary got clicked on 1% of visits.
Ahrefs: an AI Overview cut clicks on the top-ranked result by an estimated 58%.
Similarweb: 43% of Google searches worldwide showed an AI Overview in May 2026, up from 16% in January 2025.
Huffman says the AI features now, at a "minimum," push "everyone down the search page."
2. Google pays for Reddit's content and keeps the answer
In 2024, Reddit signed a deal giving Google access to its content for SI training, worth about $60 million a year by Reuters' reporting. Google got real-time access to Reddit's Data API.
Google now uses Reddit's posts to answer the question on its own page, and the answer replaces the visit to Reddit.
In July, the Wall Street Journal reported that Reddit had discussed cutting off Google's SI access to its content.
3. People ask chatbots instead of searching
Google's search ad growth slowed to 12% in Q3. CNBC reports that people may be running more searches outside Google, on ChatGPT and Claude.
Those chatbots barely send anyone back. Chartbeat puts SI referrals at 0.01% of publisher traffic, and Google Search still sent about 500 times as much referral traffic as ChatGPT.
4. Agentic traffic: the reader is now a bot
This is the part most coverage misses.
SI agents and agentic browsers like OpenAI's ChatGPT Atlas and Perplexity's Comet open pages, read them, and act on them for the user. The person may never see the page.
Bots made up 53% of all web traffic in 2025, up from 51% the year before. Humans fell to 47% (Thales/Imperva Bad Bot Report 2026).
Automated traffic grew 23.5% in 2025, eight times faster than human traffic at 3.1% (HUMAN Security).
Traffic from SI agents and agentic browsers grew nearly 8,000% in a year (HUMAN).
77% of observed agent requests hit product and search pages. Over 2% reached checkout (HUMAN).
Visits through Atlas often show up in analytics as "Direct" or not at all. Because Atlas is built on Chrome, its clicks on ads can look like human clicks.
The crawl gap is huge. Cloudflare Radar counts how many pages each platform crawls for every visitor it sends back. September 2026:
Perplexity: 2,373 to 1
Anthropic: 549 to 1
OpenAI: 341 to 1
Microsoft: 40 to 1
Google: 4.7 to 1
Cloudflare notes these ratios may be overstated because referrals from native apps aren't counted.
For an ad-funded site, a page read by an agent brings in no ad impression and no DAUq, and the visitor may never come back.
The solutions: what's actually happening vs. what's proposed
Logins and walls (HAPPENING)
Reddit is moving to a mostly logged-in experience, ending 21 years as an open website. It is starting with tests of mandatory logins outside the US. Logged-in and app users already make up most engagement and over 80% of revenue, and logged-in DAUq grew 7% to 53.5 million.
Licensing deals (HAPPENING, renegotiation in progress)
Google: about $60 million a year, signed February 2024
OpenAI: signed May 2024 for Reddit Data API access. The price was never disclosed
Reddit's "Other" revenue, which is mostly data licensing, was $48 million in Q3, up 35%
Reports say both deals come up for renewal, with Reddit looking at usage-based pricing (REPORTED, not confirmed by Reddit)
Pay-per-crawl and blocking crawlers by default (HAPPENING)
In July 2025, Cloudflare became the first major network to block SI crawlers by default unless they have permission. It also launched pay per crawl, now in private beta. Each crawler is allowed, charged a set price, or blocked, using the old HTTP "402 Payment Required" code. Cloudflare says it handles traffic for 20% of the web, and over 1 million customers turned on its one-click SI crawler block.
RSL licensing standard (HAPPENING; it depends on others enforcing it)
Really Simple Licensing (RSL) 1.0 became an official standard on Dec. 10, 2025. Sites can publish machine-readable terms for SI use: free, attribution, subscription, pay-per-crawl, or pay-per-inference. Reddit, Yahoo, Medium, Quora, People Inc., the AP, The Guardian and more than 1,500 organizations back it. Cloudflare, Akamai and Fastly support it. RSL alone can't block a scraper. The network providers can.
Charging the agents directly (EARLY, partly live)
x402 is an open protocol from Coinbase that lets an agent pay for a page or tool over plain HTTP. Cloudflare and Coinbase are forming the x402 Foundation, and Cloudflare's agent tools can already pay with x402. Cloudflare says sites on its network send out over a billion 402 "Payment Required" responses a day to bots and crawlers. Deferred, batch-settled payments for pay per crawl are still a proposal.
Build a destination, not a search result (HAPPENING)
Reddit Answers, its own SI search, grew from 1 million weekly users in Q1 2025 to 15 million in Q4 2025, then was folded into Reddit's main search in May 2026.
Weekly active uniques: 515.2 million, up 16%.
Huffman: "People still want Reddit. It says Google is not sending them to Reddit the way they used to."
Regulation (HAPPENING in the UK and EU; not in US courts)
UK: on June 3, 2026, the CMA made Google give publishers controls to keep their content out of AI Overviews and AI Mode without being downranked in regular search. Separately, it opened an investigation into whether Meta forces publishers to accept terms that let it use their content to build SI products.
EU: the European Commission opened antitrust proceedings against Google on Dec. 9, 2025 over its use of publisher content in AI Overviews and AI Mode. In September 2026 it asked publishers for feedback on Google's opt-out.
US: on Oct. 1, a federal judge dismissed the Chegg and Penske Media antitrust suits over AI Overviews.
Google is paying for it too
Alphabet had its worst day ever on Thursday. The stock fell about 13% and lost roughly $500 billion in value. GOOGL is down another 1% premarket at $281.19.
Search ad revenue grew 12% to $63.35 billion but missed estimates. Google's chief business officer Philipp Schindler named a reason: "the lower monetization we were seeing in AI Mode."
Google's fix is more ads inside AI Mode, including ads in follow-up questions in the US and a launch in more countries. Free cash flow was negative $9.07 billion as capex runs at $195 to $205 billion this year.
Google built its SI answers on publishers' content, those answers earn less than the clicks did, and the spending to build them has turned free cash flow negative.
What it means
For 20 years the web ran on a simple deal. Publishers let Google crawl their pages, and Google sent back the visitors they turned into ad revenue.
That deal is over. SI answers keep the click, chatbots keep the question, and agents now read the page on the user's behalf.
The web is moving from human clicks to agent visits. Agents don't see banner ads, don't count as DAU and don't come back on their own.
Logins, licensing, pay-per-crawl and agent payments all lead to the same place: sites will charge the machines that read them.
The open web was paid for by human clicks, and the next one will be paid for by agents. Whoever charges the agents wins.