For years, lots of us have typed a question into Google, added "reddit" at the end, and read the answers without ever signing in. That might be ending. During its earnings report on Thursday, Reddit said it's moving toward a mostly logged-in experience.
The reason is AI. More people are getting answers straight from AI summaries instead of clicking through to websites, and Reddit says search referrals fell by more than a million a week on average in October. The company even warned that daily users could drop by a low double-digit percentage next quarter if that keeps up. TechCrunch did the math, and that could take Reddit from 130.3 million daily users down to somewhere around 115 to 117 million. U.S. daily users already slipped from 53.2 million last quarter to 50.7 million.
Putting content behind a login does a few things. It keeps AI scrapers from grabbing Reddit's posts for free, which gives Reddit more leverage to sell licensing deals to AI companies. It also tells Reddit more about what you like, which helps with ad targeting, and it announced its new algorithmic "For You" feed the day before. Testing starts this quarter in select markets outside the U.S., with no date yet for a global rollout. Reddit says it's also rebuilding its incognito mode.
CEO Steve Huffman admitted this one is personal. As someone whose life was shaped by the open internet, he called it a big change for him but said he believes it's the right next step.
The funny part is that the business is booming. Revenue jumped 53% to $895 million, beating forecasts, and profit rose 74% to $283 million.
TechCrunch called it a possible canary in the coal mine for the open web. If Reddit closes the door, who's next?
