"Reddit took a victory lap on its Q3 earnings call on Thursday. For the first time, the social platform achieved its pre-IPO profitability goal of 40% adjusted EBITDA, said CEO Steve Huffman. Reddit is also the No. 3 most-visited site on the internet for US-based users, according to Semrush - trailing behind only YouTube and Amazon.com. And Reddit touted some impressive numbers for its advertising business, including $549 million in Q3 ad revenue and a 74% YOY growth rate."
"That even Reddit isn't seeing traffic from AI search - despite its high-profile $60 million AI licensing deal with Google - bodes ill for any publisher hoping chatbots will drive traffic to their site. However, Huffman added, he's optimistic that Reddit's AI partnerships - which also include a deal with OpenAI - will eventually bear some kind of fruit beyond licensing fees."
Reddit reached its pre-IPO profitability goal by recording 40% adjusted EBITDA for Q3. The site ranked as the No. 3 most-visited internet destination for US users, behind YouTube and Amazon. Q3 advertising revenue totaled $549 million, representing 74% year-over-year growth. Reddit reported a $60 million AI licensing deal with Google and a partnership with OpenAI, and described those relationships as healthy and informative about the value of Reddit's data. Executives said generative AI search is not driving traffic today. Reddit is suing Perplexity, Oxylabs UAB and SerpApi for alleged unlicensed scraping of its content.
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