Reddit shares fell approximately 30% after chief executive Steve Huffman warned that Google’s AI-powered search features are reducing referral traffic to the platform. Huffman explained that answers generated directly by AI Overviews and AI Mode are keeping users away from traditional results, including the websites that provide the information. The decline was also driven by weaker fourth-quarter revenue guidance and a slowdown in user growth. Reddit additionally believes Google’s ranking changes for machine-translated content are affecting traffic outside the United States. To compensate, the platform is improving its feeds and recommendation technology to encourage member engagement and daily use.
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