Reddit stock sinks on report it may not renew Google AI content deal
Google's AI summaries have reduced traffic to websites from the search results page and Reddit is reconsidering the benefits of the deal, the Journal said.
Google's AI summaries have reduced traffic to websites from the search results page and Reddit is reconsidering the benefits of the deal, the Journal said.
Shares of Reddit slid 9% on Wednesday after the Wall Street Journal reported the company has discussed shutting off Google's access to its content for artificial intelligence use.
The two companies struck a deal in 2024 to allow the search giant to train its AI models on Reddit's content. But as Google's AI summaries reduced traffic to websites from the search results page, Reddit is reconsidering the benefits of the deal, according to the Journal, citing people familiar with the matter.
The search traffic trend can be seen on other sites as well, with Politico's Google traffic falling 23%, CNN's falling about 25%, and Business Insider's dropping more than 85% between June 2025 and 2026, the Journal reported.
It's part of a patchwork of media and publishing companies that have reevaluated their relationships with the biggest AI giants, with some taking legal aim to protect their intellectual property as their sites have suffered lower search traffic.
Last year, Chegg sued Google in federal district court, claiming that its AI summaries of search results hurt the company's traffic and revenue.
In a statement to CNBC at the time, Google said the company "sends billions of clicks to sites across the web, and AI Overviews send traffic to a greater diversity of sites."
Google responded to the Wall Street Journal on Wednesday with a similar statement, saying that its AI features help creators and publishers grow their audiences.
According to the Journal, Reddit's $60 million-a-year deal with Google is ending soon, and the companies are in talks about potentially renewing the partnership.
Reddit has also had a similar partnership with OpenAI that allows for the ChatGPT maker to train its AI models on its content, as part of Reddit's data licensing business that helped fuel an earnings beat last quarter .
During the first quarter, the company blew past analysts' expectations after revenue jumped 69% from a year earlier, reporting earnings per share of $1.01 versus 58 cents expected, and revenue of $663 million versus estimates of $611 million.
"We have important partnerships with both Google and OpenAI," Reddit CEO Huffman told analysts on the earnings call. "Those are very meaningful to us, and I think it's mutual. We continue to value those."
The company is set to report its second-quarter earnings on July 30.
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