Reddit earnings: revenue jumps 53%, but search visits fall and logged-out browsing faces a test

Think of the last time you searched a question and added “reddit” at the end. Millions of people do it every day, often without an account. That habit sits at the centre of the Reddit earnings report this week, and it may soon change.

On Thursday, Reddit reported a strong quarter: revenue up 53%, profit up 74%. But in the same report it said visits from search engines are falling fast, and that it will test a version of Reddit you can only read when logged in. On Friday, its shares lost more than a quarter of their value during trading, Reuters, CNBC and TheStreet reported.

Reddit earnings in numbers: 53% growth and a US$283 million profit

From Reddit’s own release, the Reddit Q3 earnings for July to September 2026 look like this:

• Revenue: US$895 million, up 53% from US$585 million a year ago. Ads brought in US$847 million.
• Outside the US: revenue rose 67% to US$176 million, faster than at home.
• Profit: US$283 million, or US$1.40 per share.
• Daily visitors: 130.3 million unique daily visitors (Reddit’s “DAUq”), up 12%. In the US, the figure fell 2% to 50.7 million.
• Forecast for October to December: revenue of US$1.0 billion to US$1.03 billion.

Chief executive Steve Huffman said the business is growing because Reddit “captures the human experience in a way that no other platform can replicate”. Reddit also said it has joined the S&P 500, the index of large US companies.

A million fewer search visits every week

The worry sits in the shareholder letter. Reddit says search referrals, the visits that arrive from a search engine, fell “meaningfully” in the quarter and the drop sped up toward the end. In October, they fell by more than 1 million a week on average.

If that pace continues, Reddit warns, its daily visitors could fall by a low double-digit percentage this quarter from about 130 million. That is a warning, not a forecast, but it puts a size on the Reddit traffic decline.

Reddit does not name Google. It says web search is becoming “an AI-powered destination itself”, where answers appear on the search page. Reporters at Reuters and CNBC link the drop to Google’s AI search tools. CNBC called the sales forecast weak, and StockStory, which tracks analyst estimates, put it below what analysts expected. That helps explain why a strong quarter met such a sharp sell-off.

If you read Reddit without an account

This is the part that may touch you. Reddit says it will “begin fully testing” a logged-in-only Reddit in select markets outside the US this quarter. It has not said which countries. The results will shape a version it plans to roll out worldwide.

Its reasons are open. Logged-in and app users bring in more than 80% of its money, and logged-in users give it better signals for ads. Reddit also wants to protect its large store of posts, which it calls “extremely valuable”. Today, more than half of its daily visitors browse logged out: 76.8 million of 130.3 million.

So if you live outside the US, you may soon find a Reddit login required before you can read a thread. Signing up is free. In practice, it will also mean sharing more of your reading habits with Reddit and its advertisers. If you hold Reddit shares, watch the visitor numbers in the next Reddit earnings report as closely as revenue. This is not investment advice.

Strong growth, but the open web is shrinking under Reddit’s feet

There is a lot to respect here. Reddit’s revenue has grown fast for several quarters, it is profitable, and its overseas growth suggests the product travels well. Its view that people want real human answers, not only machine summaries, is fair.

The concern is just as real. Much of Reddit’s reach was borrowed from search engines, and that door is narrowing. Alphabet’s own results this week showed AI answers moving to the centre of Google search. A login wall may lift ad revenue per user. But in practice, walls like this usually turn away some casual readers, and Reddit’s openness is part of why people trust it.

On balance, Reddit is reacting early and honestly to a real shift. The likelier outcome is a smaller but more engaged audience, and a few bumpy quarters while it finds out whether readers will sign in.

The test countries are the place to watch. If people there make accounts rather than leave, the login wall will spread. If they leave, Friday’s Reddit stock crash may prove to be the first sign of a much harder problem.